Grand Committee
The Deputy Chairman of Committees (Baroness Watkins of Tavistock) (CB)
My Lords, if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.
Economic Crime and Corporate Transparency Bill
Thursday 20th April 2023
(1 year, 8 months ago)
Grand CommitteeRead Full debate Economic Crime and Corporate Transparency Act 2023 View all Economic Crime and Corporate Transparency Act 2023 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 96-III(a) Amendments for Grand Committee (Supplementary to the Third Marshalled List) - (20 Apr 2023)
Lord Wallace of Saltaire
“Overseas companies: international co-operation
Within six months of the day on which this Act is passed, the Secretary of State must report to Parliament on what arrangements with foreign states and international organisations have been agreed to verify information about overseas companies within the scope of this Act, and the identity of their directors.”Member’s explanatory statement
Verification of information about companies and directors based overseas will require co-operation with foreign governments and with organisations responsible for monitoring cross-border finance, trade and crime. This amendment seeks to probe that the government is putting such arrangements in place, and will report them to Parliament.
Lord Wallace of Saltaire (LD)
My Lords, this amendment is to ask for much more information from the Government on the international implications of the Bill, which is a way of asking whether the Bill is serious in terms of enforcement. Most serious economic crime—indeed, all serious economic crime nowadays—is cross-border: the money is taken out of your bank account and rapidly moved to another jurisdiction. One of the huge problems we all face in a globalised economy is that policing is bounded by sovereign borders and criminals are not. Therefore, Governments are forced to co-operate across them.
One of the questions I hope we will pursue on these amendments and the ones that follow on the overseas territories is how Whitehall ensures that the various parts of it that deal with the various parts of our international efforts to combat different forms of crime—terrorist financing, drug smuggling, people smuggling, et cetera—co-ordinate, and which are the lead departments for what. Reference has already been made to HMRC and the Treasury. I note that, in Washington, the US State Department has now established a State Department-led but cross-department anti-corruption board to deal with these necessarily cross-border problems. I hope the Minister will be able to tell us—if not now then perhaps, as I asked at Second Reading, in a briefing in the context of the Bill—how Whitehall will make the necessary changes to ensure that different departments work together coherently in coping with these very complex problems.
It might help if I remark briefly on how I became involved in some of these problems of international crime. In 1989 I was director of research at Chatham House, the international affairs think tank. I was approached by a chief inspector who was then head of the strategy unit at the Metropolitan Police to ask if we could run a seminar on the international dimensions of policing, now that it seemed likely that the Berlin Wall might come down. As it happened, I was then attached briefly to an institute in Germany, in Bavaria, and when I asked it whether I could get any briefing on the subject, which I knew nothing about, I found myself very rapidly being taken to the Bundesnachrichtendienst headquarters and given a very thorough intelligence briefing on how the German Government were approaching the likely explosion of cross-border crime that would accompany the end of that very hard border that had kept a lot of crime away from western Europe.
Since then, we have had 30 years of globalisation, the communications revolution, digitisation and international banking deregulation, which have made cross-border economic crime far easier, far faster and far harder to keep up with. It is no accident that the Financial Action Task Force, one of the main mechanisms for international intergovernmental co-operation in combating money laundering, was also founded in 1989 by the G7; it saw what was coming. Perhaps the Minister can consider whether we could have a briefing on this to be told more about how effective the Financial Action Task Force is.
When I looked rapidly for an update on the FATF, I was a little worried to find that there is rather more up-to-date information on Wikipedia than there is in statements from GOV.UK, which tend to be from 2015, 2018 or 2019. The Wikipedia comments say that the FATF is now pretty good at setting standards and maintaining a blacklist and a grey list of countries that do not observe basic international standards. Some of your Lordships will have seen the article in the Financial Times yesterday about the Government of Panama hoping that it may finally be about to be taken off the grey list, which has clearly damaged its position as an international financial centre. But apart from reporting and setting standards, the FATF does very little in terms of enforcement. The question of enforcement, verification and the exchange of information is extremely relevant to whether the Bill is really going to make a difference to our pursuit of economic crime.
I followed the development of international police co-operation in the 1990s, partly because, when I came here, I became chair of the sub-committee of the European Union Committee that dealt with justice and home affairs, and thus followed quite closely the development of Europol, the Schengen Information System and those other forms of European police co-operation. I was struck by the extent to which progress was driven not by any commitment to some fantasy of a European superstate but by the demands of police forces and intelligence agencies in different countries. They needed to share information—in good, constant time if possible—and share activities and operations, as they now do. Of course, we have now left Europol and the Schengen Information System, which has denied the British authorities access to one of the closest ways in which we used to share information on transborder economic crime. I am not very well informed about the other mechanisms, apart from the OECD’s various activities on beneficial ownership and the FATF, which we find useful.
As the noble Baroness, Lady Blake, may remind us, David Lammy, the shadow Secretary of State for Foreign Affairs, proposed some weeks ago that there should be a transatlantic anti-corruption council to bring together more closely the various agencies, authorities and law enforcement bodies concerned with these areas. I am not aware that the British Government are actively engaged in all this, so my amendment asks the Government to tell us what the current situation is, what their strategy is and how this intrinsic element of any serious approach to economic crime will be treated. If they are unable to do that, they cannot be very serious about the enforcement of action against economic crime, which is not, after all, primarily a domestic matter. I beg to move.
Baroness Blake of Leeds (Lab)
I will respond to the comments made by the noble Lord, Lord Wallace, in moving his Amendment 68. I was very struck, looking back at the comments from Second Reading. He very forcibly talked about the international dimension and how important it is, and the fact that the international dimension in the Bill generally is thin; I think those were the words he used. I think we all knew that we would require amendments to look at this area. I am keen to understand from the Minister what actually is being proposed.
We talk a great deal about collecting data, but one of the rules of thumb I have always worked with is that data is of use only if it is open and transparent, there is a responsibility for the data to be analysed and, where things are held up as being untoward, appropriate action is taken.
I do not want to draw out the debate, but this could be an opportunity for the Minister to give us an update about the progress made since the Government launched the register of overseas entities on 1 August. What is the Government’s assessment of the success of the register and of the beneficial ownership registration being set at 25%? Do we know whether many companies are avoiding this by spreading out shares throughout a family? We know that there were significant concerns about nominee arrangements being used to disguise true beneficial owners. What is the Government’s assessment of this, now that the register has been introduced, and will they use the regulation-making powers in the existing economic crime Act to address this?
I anticipate a full response to the issues raised by the noble Lord, Lord Wallace. I would like to understand and am seeking reassurance that the Government are putting arrangements in place. As we have heard, the scale of the co-operation is quite significant. It needs constant review, and it needs to relate to finance, trade and crime. I look forward to the Minister’s response.
The Minister of State, Department for Business and Trade (Lord Johnson of Lainston) (Con)
I thank noble Lords very much. It is a great pleasure to be here again to continue this valuable and important inquiry into how to make our company structures more transparent, fairer and more effective for our long-term business needs.
I thank the noble Lord, Lord Wallace of Saltaire, for this amendment. Over the next few hours, I hope to cover many of the points raised and clarify further points from our discussions earlier this week. Specifically on this amendment, I hope it will be of some reassurance to noble Lords that Companies House already has excellent relationships with overseas counterparts—it is important to emphasise that. It works closely with authorities in the Crown dependencies and overseas territories on the implementation of the register of overseas entities.
The noble Baroness, Lady Blake, asked about the progress of the register of overseas entities in relation to UK companies and, specifically, property ownership. We have come a long way: I think we are now 75% to 80% registered. Some overseas entities have not fulfilled our requirements, and I am happy to send a note to Peers about that. This changes regularly but it is a minority, which is important. I am pleased about that, and we are grateful for the collaboration of the Crown dependencies and overseas territories.
As a government Minister it is important that I say that, if you listened only to this debate and did not have any experience of the outside world, you may be forgiven for thinking that every single authorised corporate service provider, Crown dependency and overseas entity was somehow engaged in and designed for criminal undertakings, which we all know is not the case. It is important that I state that many of these measures and the discussions we are having are about a very small minority of bad actors and that the overall industry is worth while and valuable. The principles around high-quality corporate service provision, Crown dependencies managing their own affairs and how companies are structured are very much to be celebrated and embedded. What we are doing here is making sure that there is transparency and legitimacy. I want to make sure that is on the record.
Earlier today I met a former regulator from one of our Crown dependencies, who was surprised at the tone that some noble Lords are taking in the debate, given what he had done with his own regulator in his Crown dependency. He felt that it had set the standard—a higher standard, maybe, than some other Crown dependencies. He felt that they had lessons to teach us in the United Kingdom. We ought to be aware of this. I do not want to belabour the point, but it is important to get the tone right and make sure that the messages are clear.
Lord Fox (LD)
I took it as an implicit, or rather an explicit, criticism of His Majesty’s Opposition, us and others who have spoken to amendments to the Bill that we somehow regard the whole industry as corrupt. I would take the Minister to task and suggest that he reads Hansard for the previous session, where I made it clear that that is not our view—and I know it is not the view of His Majesty’s Opposition. The fact is that we are speaking about bad actors because the whole purpose of the Bill is to deal with them. It can be taken on faith, but perhaps we have to say it every time, that we consider bad actors to be a minority of players in this sector, but they are the purpose for which the Bill has been brought forward.
Lord Johnson of Lainston (Con)
I greatly appreciate the comments from the noble Lord, Lord Fox; I am so glad that he said that. I do not mind if some friction is sometimes required in order to make sure that the messages are heard loud and clear. I am glad that the noble Lord has reaffirmed his position, that of his party and that of the main opposition party. We all agree on this, but it is important because I was picked up on it today. It sounds as if we are at war with a legitimate sector and the legitimate concept of how to structure companies, which are at the very core of our capitalist system and have created so much wealth for us. I am glad that we are united on this point.
I was asked by the noble Baroness, Lady Blake, about the number of entities that have registered with the register of overseas entities. I have a figure of 27,000, which represents a high level of compliance. I hope that figure satisfies her request, but I would be happy to publish further figures or to answer her in writing on that.
Lord Coaker (Lab)
I will just reinforce the point that the noble Lord, Lord Fox, made. To be honest, I do not think the Minister was implying that we were condemning the whole of business, but the noble Lord, Lord Fox, made an important point. The Committee is trying to say that, overall, we all support the Bill but we want to ensure that it is effective, understandable and enforced. In challenging the Government, we seek not to undermine business but to improve what most of us regard as a reasonable Bill.
The only other point I make to the Minister is that—I think we all accept this—public opinion is frustrated about what it sees as a lack of action in respect of certain bad business practices, such as the laundering of money. Lots of fraud and economic crime takes place but is not seen as a priority by the state—irrespective of whether you mean Labour, the Liberal Democrats, the Conservatives, the Scottish nationalists or whoever—which does not take this seriously. I suggest to the Government that, if I were a government Minister, I would parade much more powerfully than the Government have done that we are trying to ensure that public anger is assuaged by the fact that we are no longer prepared to see Russian money used in the way it has been nor to see bad practice, which means, frankly, that good business is undermined.
This is the point made by the noble Lord, Lord Fox. Good businesses, which represent the majority of the country, want something done about bad business because it undermines them. This is a really important point; I think it is the point that the Minister was trying to make. This is a good Bill but it needs to be improved. From what he has said to us, I think the Minister will take on board many of the comments that have been—and will be—made and change the Bill. But it is also about saying, “Of course the majority of business is good, but there is bad practice out there and it needs sorting out”. Good business wants that to happen as much as members of this Committee do.
Lord Wallace of Saltaire (LD)
My Lords, as I said in moving this amendment, our concern is around the Bill, when it becomes an Act, having the resources and the international co-operation structure to make it effective.
The Minister talked about exchanging information, but there is also the question of enforcement. If we are trying to enforce on someone who is based in the UAE, Panama or Singapore—let alone Hong Kong—these things are not easy. We all recognise that since 1989 a number of mistakes have been made. This Government—and this country under different parties in government—made a succession of mistakes in our handling of Russian money as it came into the country. Many of those mistakes have now been corrected, but we have to admit that we did not handle this very well and we now find ourselves in a situation in which other financial centres are extremely difficult to investigate. One looks at the Wirecard scandal, for example. One of the world’s major accounting firms failed to discover that a substantial chunk of the assets that Wirecard was declaring, which were alleged to be in Singapore and Malaysia, did not exist.
Clearly, the need for active exchanges between Governments, central banks and others is vital in this situation. That is what we are trying to ensure happens. Yes, it is a small number of companies, but it is not a small amount of money. That, therefore, has to concern us if the Bill is to be a useful reform and a worthwhile Act.
I remind the Minister that that the FATF grey list at the moment includes the Cayman Islands and Gibraltar, as well as the United Arab Emirates, Turkey and a number of other countries with which we have close ties. I am conscious that 100,000 British citizens now live in the United Arab Emirates, many of whom are actively engaged in the international financial industry. That has to be a matter of concern to us. Not very long ago, some in the House were talking about the activities of UAE intelligence services with regard to UAE nationals on British soil. There are a great many difficult issues that we have to cope with here. We also understand that this situation is not static. The communications revolution has already made the transfer of money around the world much faster than it was 10 to 20 years ago, and we need to keep up with that.
I should have mentioned another OECD initiative that is related to economic crime, on base erosion and profit shifting. It is concerned with tax evasion, which I include as part of economic crime. That is another area in which Governments are beginning to co-operate. It is very difficult to gain co-operation. The entire British Government are not always as keen on co-operation as some parts are, because some departments naturally have different interests from those of others. I raised the question of Whitehall co-ordination and where its leadership sits, and it probably needs to change, as it just has in America, because the nature of the problems we face is also changing.
I withdraw my amendment, but I hope that these conversations will continue. I express our shared concern that legitimate international finance will prosper and that aspects of international finance that are illegitimate will be carefully monitored and prevented.
Lord Agnew of Oulton
“Publication of information about trustees
In section 22(1) of the Economic Crime (Transparency and Enforcement) Act 2022 (material unavailable for inspection), omit paragraph (c).”Member’s explanatory statement
This amendment would enable Companies House to publish the names of parties to trusts which own Overseas entities in the Register of Overseas Entities. Currently Companies House collects this information but does not publish it.
Lord Agnew of Oulton (Con)
My Lords, I probably ought to start by checking with my noble friend the Minister and his officials that his own amendment, Amendment 76H, does not solve the problem that I am seeking to solve. That will be a very quick answer from my noble friend if it does. It is Amendment 76H—I am slightly flummoxed by section numbers, clauses and subsections.
I will explain to the Committee why the amendment is important. Companies House now collects the information that I am keen for us to have more visibility of, but it does not publish it. I am asking simply that we allow for the information being collected to be published. The register of overseas entities that has just been created is working. I agree with all the comments made a few moments ago about most people involved in business being honest, but this Bill focuses on bad people.
Lord Faulks (Non-Afl)
My Lords, I support the amendment. I have benefited, as I dare say have a number of other noble Lords, from the briefing from Transparency International explaining why the amendment is so important and very much consistent with the theme and title of the Bill.
I too will probe a little what the Minister said about the register of overseas entities. I think he said there were 27,000 on it at the last count—I am sure the figure changes regularly—and that is encouraging. The move for a register of overseas entities was, I fear, prompted mostly by the fact that on large wastes of central London and other parts of the United Kingdom were properties whose ownership was very unclear. In reality, they were often owned by what we now seem to be calling “bad actors”—at least, we did not know who they were, whether they were bad or good actors. That information should now be much more available than it was.
I think the Committee would be most interested to know whether, with the information that is now obtained, there has been any follow-up. In the evidence we were given about the register of overseas entities, it was explained, for example, that it should enable some link-up with pursuing people under the unexplained wealth order provisions, because there would be more information—you could identify who owned a property and why, if they were a fairly low-grade official in a Russian company, for example, they now owned a property in Belgravia worth several million pounds. Similarly, how is the information assisting in sanctions and the like, and with anti-money laundering?
Generally, there is a lot of information that should be available to the various agencies as a result of the register, rather than simply ticking a box. There may be a theme in the debate that we have been having. Yes, we are enthusiastic about the increased information that is in Companies House and the increased information that will flow from the identity of those on the register, but what we really want to know is whether it will be translated into valuable information that will fulfil the aim behind this legislation.
Lord Vaux of Harrowden (CB)
My Lords, I support the amendment in the name of the noble Lord, Lord Agnew. To follow up on what has just been said, at the date of Second Reading, approximately half of the expected 32,000 companies that were going to register had done so. I gather that this figure is now 27,000, which is a good step forward. At that time, when it was a rather smaller number, I think 4,000 of those companies suggested that they were owned by trusts, which shows the scale of this issue.
I think it was the noble Lord, Lord Leigh of Hurley, on the first day in Committee, who was sceptical about whether my amendments identified the ultimate beneficial owners of trusts. He was right to be sceptical; I do not think they did. But that ultimate beneficial ownership and control is what we are trying to get to with this process. Trusts are probably the most common method used for hiding the ultimate true ownership. As I say, 4,000 out of the 16,000 companies that had filed at the time of Second Reading—a quarter—were owned by trusts, and we could no longer see where they went.
It seems very perverse that this information is hidden. I am keen to hear from the Minister a convincing explanation of why the Government feel that it should be hidden. Like the noble Lord, Lord Agnew, I see that the Minister has tabled Amendment 76H, which will extend the information required on trusts. That is very much to be welcomed. I am not at all clear—I do not think that the noble Lord, Lord Agnew, is either—on whether that information is intended to be transparent or hidden. Clearly, it should be public.
To be honest, there seem to be a lot of areas where information is hidden. We have had a number of discussions already in Committee about that. We need to step back and apply a simple principle that there should be maximum transparency, and that we should hide information only where there is genuinely a strong privacy issue. At the moment, it feels very much as if the balance is tipped too far towards privacy and too far away from transparency.
Lord Garnier (Con)
My Lords, I entirely agree with what the noble Lord has just said. Trusts are and have been frequently discussed in this Bill and its predecessors as one of the most effective ways of hiding information that ought to be made public. Clearly, some matters are properly to be kept confidential, but much of the material covered by the law of trusts ought, in the public interest, to be disclosed.
I happily support the amendment that my noble friend Lord Agnew moved a moment ago. Like him, I want to know whether the Government’s Amendment 76H renders his amendment redundant. I do not think it does, because it seems to me that there is a difference between the publication of information about trustees, which is what my noble friend talks about, and the registration of information about trusts in the Government’s proposed new clause. We can register as much as we like, but if you cannot open the box and see what is inside and has been registered, it is a pretty futile exercise. Public opinion, public policy and an assessment of the public interest suggest to me—for the reasons already given by the noble Lord, Lord Vaux, and my noble friend Lord Faulks—that the Government, if they want to maintain the difference between registration and publication, are behind the curve.
We learned a lot in my noble friend’s committee in 2019 about the huge amounts of real estate, particularly within London and a couple of its boroughs, which are owned by people, companies and trusts of which we know nothing. Many of these houses and properties were unoccupied; they were merely the physical dumping grounds for money. Obviously, they had to be paid for.
The committee on which the noble Lord, Lord Faulks, and I served was not able to discover, but sought to encourage the then Government to expose, the route by which criminal funds were laundered into London by money launderers. Any number of blocks of flats and very expensive houses, all year round, 24 hours a day, never have a single light on. You can go down smart squares in Kensington or Westminster and see places that look utterly unoccupied—because they are. They are dumps for dosh. We need to make sure that this new law is effective at exposing and, if not exposing, inhibiting before it gets here, the translation of laundered money from dodgy jurisdictions into ours. It is as simple as that. I hope the Minister is able to persuade the Committee that my noble friend’s amendment is redundant, because the Government’s amendment comprehensively and effectively does what we would like.
Lord Wallace of Saltaire (LD)
I will just add to this. As it happens, the other week my wife and I were going around the Nine Elms development, Battersea Power Station, et cetera, with an eye to when we downsize. We were told that, until then, over 40% of the apartments had been sold to people living abroad. That partly explained why it was so very quiet there; not many people were present in the complex. That raises all sorts of large questions about housing practices in London, which we need not touch on at the moment.
I want to pick up on the point made by the noble Lord, Lord Agnew, about how one establishes the ultimate beneficiary when one company is owned by another company, which is owned by a trust in another jurisdiction. That is part of what my amendment was trying to get at, as a key element before one can even begin to enforce is accurate information from regulators in other jurisdictions and territories, and how we do our best to ensure that the information we are receiving is accurate. That requires active diplomacy and co-operation between the financial parts of different Governments. We are looking for some assurance from the Minister that that is part of what is intended when the Bill becomes an Act and that we will know which parts of Whitehall will be pursuing it.
On the first day in Committee, there were some references to the role of HMRC. We have been told that Companies House will not be concerned with regulation or enforcement, but we need to know a little more about which parts of our government machine will take the lead on ensuring that we begin to unpick the cascade of trusts and companies referred to by the noble Lord, Lord Agnew, and will tell us who, in effect, the beneficial owners are.
Lord Fox (LD)
I will speak very briefly in this interesting debate. The noble Lord, Lord Faulks, referred to a theme. I agree and would characterise that theme as what Companies House knows and what is published. That publishing process turns information into actionable information, rather than just stuff in a box. We have had some useful meetings with the department and I thank them for that, but on a number of occasions the department talked about what Companies House knows; here, however, we are talking about the balance between what it knows and what is published. We are pushing much harder for more to be published. This is not prurient; it is about the point at which information becomes actionable and useful in order to do the things that your Lordships have spoken about.
I am sure that there will be issues around privacy and all sorts of things, but those can be dealt with by special process. We should not use the fact that some can legitimately require privacy to prevent all the rest of the data being published. We are asking the Minister to reassure us that his amendment does this. My sense is that it probably does not, and therefore it would be as well if he could acknowledge and address this difference between what Companies House knows and what is published, particularly in this case but there are other areas too.
Baroness Blake of Leeds (Lab)
To follow on from those comments, my comment will be very much in the same vein. We need to bring this part of the conversation into the general understanding that if we are to be successful, there has to be a root and branch reform of Companies House and the way in which it works. We need a massive cultural shift. Moving away from being a passive receiver of information to a dynamic analyser of data will be quite a step. It speaks to the need for resource to make sure that everything we are doing can be delivered. I emphasise the comments that have been made: of course we want this to succeed, but I am sure that everyone will understand our calling for more information and calling out opportunities to improve what is before us. Significant improvements can be made as we move forward.
Following on from what the noble Lord, Lord Agnew, said, we need to make sure that we do not follow the law of unintended consequences by introducing new measures and then creating new loopholes which will let bad actors fall through the net. We need to triple-check everything proposed through these measures to ensure that that cannot happen. As we have all said throughout this debate, the best way is to make sure that the data is transparent and can be viewed and seen. There have to be ways to introduce safeguards so that sensitive matters can be protected as and when they occur. It cannot be outside the bounds of possibility to make these improvements and move forward in a way that gives greater protection to all those involved.
Lord Johnson of Lainston (Con)
I thank the noble Baroness, Lady Blake, for those well-expressed sentiments. I hope the Committee knows my passion for these important reforms. I apologise for not declaring my interests at the beginning of this debate, as I should have. We have had so many different meetings it is easy to forget. It is important that I declare them because I do own companies, I have set companies up and I have been a participant in LLP structures and so on—although I do not believe I am now; please refer to my entry in the register. There is no conflict in my mind; if anything, I hope that gives me quite a good perspective on how these structures can be used for good but also by bad actors.
On the importance of eradicating corruption in our economy, there is, potentially, no greater value that a person can engage in than allocating capital to the highest point of return. That may sound a bit cynical and clear-cut but the point is that the effective functioning of our economy is what gives us the goods, services and quality of life that allow us to exist in harmony and happiness. Corruption, which we are trying to eradicate, is extremely invidious in allowing us to have successful economic growth and, in many cases, it is invisible. It is also assumed to be victimless, which is not the case: it is highly corrosive to our economy and every crime has a victim, even if they are not immediate or apparent.
Our determination to eradicate corruption and economic crime is at the core of our agenda to make our economy work better to provide better lives for our citizens. The noble Lord, Lord Coaker, raised a good point when he said that the public demand this. That is absolutely right. If one believes, as I do, in business and capitalism, and the power of capitalism to do good, if it is being distorted, that destroys our foundation and means that we do not have the true legitimacy to carry on effectively legitimate affairs, because they are conflated with illegitimate affairs.
I am completely dedicated to this mission and am grateful to all noble Peers. I am very glad that we have put on record our group support, if I can call it that, for an industry that, as we have discussed, is incredibly valuable and performs enormously important functions for companies that work in it. It is important; I am happy to state that.
Given this opportunity, I will go back over some of the statistics. The noble Lord, Lord Faulks, raised the issue of compliance. This has been well flagged; there was an assumption, perhaps, that the compliance rate is low. It has taken time for these overseas entities to register themselves. The population of entities in scope is around 32,000 but it is assumed that some of them—perhaps as much as 10%; let us say around 2,500—are dormant, defunct, in the process of being wound up or just part of the general churn of overseas entities. We now have 28,000 entities that have complied with our requirements; that is a high level if one assumes that, as I said, 2,500 or so are probably part of natural churn. So we are already looking at a non-compliance rate of maybe 1,500 to 2,000 companies out of 30,000—I know that I am making estimates; I would be happy to write to the Committee with specific numbers.
Lord Vaux of Harrowden (CB)
The Minister might be coming on to this but, when he says “compliance”, that means an entity has made a filing; it does not necessarily mean that the filing itself is compliant. The statistics that would be interesting for us are those on what the beneficial holdings behind these entities look like. Are they trusts? Are they opaque companies? It would be helpful to know that. Also, what has Companies House done—and what is it doing—to follow up on those that seem to be unduly opaque?
Lord Johnson of Lainston (Con)
I appreciate that intervention. As I said, I would be happy to write with specific information as I do not have details on all 28,000 registered businesses.
The point I want to make, which is important, is that a very large number of overseas entities have registered and, we assume, sent in information that can be confirmed and will lead to them being compliant. That is quite a high number; it allows us to focus. That is the point. The question was about what happens to the 1,500 to 2,000 or so companies that have not registered. Well, they cannot transact; they cannot participate in transactions in this country. Their assets are untransactable, which, in my view, negates the value of those assets to a significant degree. In effect, they are compelled to register and comply if they want to get their money out; that is important. Clearly, the next phase is to do the work on the companies that have registered to ensure that the information we have is accurate. We then have to make sure of why those companies that have not registered have not done so. Sometimes, there are perfectly legitimate reasons why that would be the case but, on the whole, we have made significant process.
Following our discussion earlier in Committee and the sensible points from the noble Lord, Lord Wallace—I have been glad to discuss them with my colleagues—let me say that compliance and law enforcement are at the crux of this issue. There is no point in bringing in any of this legislation—not even a single line of it—if it will not be enforced and overseen properly. My view has often been that sometimes we may not need new legislation but we need to enforce properly the legislation that we have, where a great deal of our effort will be far more effective.
Lord Faulks (Non-Afl)
I am grateful to the Minister for his clarification about the level of compliance. If will press him on one point. Last week we were provided with a useful series of notes that made this point, among others:
“Public registers allow multiple eyes to interrogate data, including the absence of data, to inform a risk-based approach to investigation and enforcement”.
I think that what the Committee would like to know is this: now that there is this compliance, who are those “multiple eyes” and what are they doing with the information that was thought necessary to eradicate some of the kleptocracy that has clearly been identified?
Lord Johnson of Lainston (Con)
I greatly appreciate the noble Lord, Lord Faulks, flagging so well the sentence that I was about to deliver. I would like to investigate further, personally as a Minister and for the benefit of this Committee, a more detailed assessment of the crime-fighting efforts that we will employ around this.
I have some good information to impart to the Committee, which to some extent answers the questions. I have particularly looked into the comments by the noble Lord, Lord Wallace, about the UAE and so on. We have signed an anti-corruption pledge or framework with the UAE in the last few years. We have in the Foreign, Commonwealth and Development Office—
Lord Johnson of Lainston (Con)
Can I just finish this particular flow of information, because I will cease to remember it if I do not get it out? I believe we have 12 Foreign Office crime experts located around the world. One of them is in the UAE, for example, and we work very hard with those countries that sit on the so-called grey list. It is important to note this. I am aware, as a Minister and a consumer, that the value and brand of a jurisdiction are extremely important. It is not effective for companies to operate easily in jurisdictions that have been classified as at risk or on the grey list.
There is clearly a hierarchy of regulatory power or brand, with the UK at the very top. When dealing with international companies, I personally always look at where a company is registered. If it is registered in the UK, we hope that the brand will grow to be even more enhanced; if it is registered in a jurisdiction about which you have doubts or that has been highlighted as at risk, it makes a significant difference to how you treat that information and the brand of that business.
Lord Agnew of Oulton (Con)
Given my noble friend the Minister’s commitment to give us some data on the whole disclosure exercise that has happened following the first economic crime Act, he mentioned that there has been a high level of compliance. We are all delighted with that, but my worry—to the point made earlier by the noble Lord, Lord Vaux—is what that actually means.
Transparency International estimates that there are at least 7,000 entities on which no light at all will be shed. In my example, JTC (Suisse) SA is a registered overseas entity. We now have that information but it means absolutely nothing, because beneath it is a cascade of other entities that we seem to have no visibility on. When the Minister puts together his reporting suite, can he let us know how many are essentially just a number or a name on a piece of paper?
Perhaps I should have raised this earlier, but in our very useful briefing with officials on Monday they explained that the ROE was set up specifically for property, and therefore a lot of the enforcement was around property assets. Property—real estate—is of course a much easier concept to deal with than the rest of the things we are talking about in commerce. A piece of paper or digital ownership of a share is much harder. I am interested to know what enforcement will happen for those much more invisible assets.
Lord Johnson of Lainston (Con)
I am constantly grateful to my noble friend Lord Agnew for his interventions and thoughtful input. I am pleased to say that we have to look forward—unfortunately not today, but maybe next week—to the section on crypto assets and similar assets. I believe that we have made great headway; this is technical and complex, and we welcome interventions and input from this Committee and anyone else that will allow us to more effectively police that area. I am very much on my noble friend’s side on this. It was certainly worth him mentioning that the register of overseas entities relates to property, which is true. I cannot comment on the specific case that he raises, but the assumption is that the data will be checked and verified. The whole point is that a registered overseas entity has to conform to our people with significant control regime and so on. That will allow us to make that assessment. I will confirm to the Committee what we are going to do in terms of reporting against that data.
As I say, there was a discussion earlier in the week about the budgetary allocations for economic crime fighting. It is very important that we show this House, and the nation at large, how much money the Government are putting into this area and how seriously we take it. I am proud of our record and want to put together a strong case to show your Lordships what we are doing. Can more resources be allocated to anything? All of us here have experience, if we have been in government, and of course it is possible. But the fact is that if I look magnitudinously over the last few years at the attention placed on this subject and the money put into it, it is a completely different story from, say, 2010—and for good reasons. It has become crucially apparent that the world has changed, and we need to react to that.
Lord Vaux of Harrowden (CB)
The noble Lord is right that it is sometimes necessary to protect the privacy of individuals. I do not think anyone in the Room would argue otherwise, but it is true that trusts can be and are used to hide real beneficial ownership. The noble Lord will correct me if I am wrong—I apologise for not having the Act in front of me—but I recall that a process within the Act allows entities to apply for their information not to be on the public register. That should cover the privacy issue. The default should be that the information is on the register. If the entity has applied for the information not to be and Companies House has accepted its reason as valid, that is fine, but the default should surely be that the information is public.
Lord Johnson of Lainston (Con)
I appreciate the noble Lord making that comment, which I will come on to but, if the Committee does not mind, I would like to correct some of my statistics. Slightly fewer than 28,000 of our overseas entities have registered, although it is very nearly that. My officials want me to be accurate, so that I never mislead this august Committee. I should also be specific about the PSC regime relating to registered overseas entities. As noble Lords know, but were kind enough not to pick me up on, they have a separate regulatory regime, which is similar to it but not actually called that. I apologise and hope that has been corrected.
Baroness Blake of Leeds (Lab)
It would be helpful if we were regularly updated on the number of overseas entities that have registered, with a running total. Otherwise, we keep having to come back and it is not clear where we are in the process.
Lord Vaux of Harrowden (CB)
I would also be grateful if the Minister could answer the question about whether there is a process for privacy.
Lord Johnson of Lainston (Con)
I am just coming on to that. The noble Baroness, Lady Blake, is right to ask for there to be a running total, because a further 717 overseas entities have complied in the recent period since my own figures were updated—so it would be quite useful to see how that is going. I would also like to separate the comments of the noble Lord, Lord Vaux, about the ability to keep some information private from the presumption of this Bill, which is the presumption for privacy for trusts rather than it being the exception.
This matter was well debated in the other place during the passage of the Bill—I am sure that some of your Lordships have had the opportunity to read that debate—but the question was what level of information should be published. Let us remember that all this information is collected by Companies House, so it is on record. In terms of crime fighting, it will be fully available to Companies House for the processes that all companies are obliged to undergo. It is perfectly reasonable to have a debate about what level of transparency there should be when it comes to publishing information. As I said before an intervention, it may also be appropriate for there to be a presumption of privacy for small, micro-entity information, given that some of those very small businesses are in effect people’s private wealth.
We should not conflate the work that we are trying to do here on Companies House, corporate transparency and reducing crime with some of the powerful principles around privacy, investment, family and protection, which are not irrelevant. It is important that we have a debate about this. The Government have committed actively to explore levels of information that should be published. The Treasury is very specific on my mandate in this discussion. I am not mandated to commit to any level of transparency above and beyond what we are already doing, which is a significant change, yet, at the same time, I can, and am keen to, commit to further debate about the level of transparency.
Lord Garnier (Con)
My noble friend’s own Amendment 76H is in a different group to this one, but it is likely that we will debate it later today. By then, he may not have had time to take further advice about the default position that we would like to see; that is, everything should be made open unless there is a good reason for it not to be. I was struck by the expression that he used a moment ago, particularly when dealing with micro-companies, that the default position should be one of confidentiality—“secrecy” is an emotive word—in favour of the micro-company and its owners as opposed to the other way around.
We are looking for a general rule, a general default position, that there should be openness unless there is a very good reason for there not to be—and, as my noble friend pointed out, there will be occasions when there is a very good reason not to have an open-source register. Is my noble friend in a position, even if he is not able to do so later this afternoon when government Amendment 76H comes to be debated, to amend or clarify the Government’s position? Can he assure us that Report will be the occasion when this further debate will be held? To say that there will be opportunities for a debate about the default position does not pin it down to a particular date or time. My noble friend will know, and the usual channels will know, that time is precious and Governments can often find an excuse, based on inconvenience, not to allow a debate that is required to take place.
Lord Johnson of Lainston (Con)
I thank my noble and learned friend for that point. Going back to the comment the noble Baroness, Lady Blake, made about the statistics on registered entities, I understand that there is a website that tracks this, which the Committee can log on to each day to see progress. We will send that link around to encourage your Lordships to look at it, but at the same time we will make sure that we provide more information about the statistics.
I cannot commit to a debate on trust transparency at this stage, but what I can commit to is that the Government are exploring this topic, which I think is separate to some of the discussions we are having. I would like to clarify my own point, which the noble Lord raised, about micro-entities and the assumption of publishing. I believe that the assumption is that the information would be published. My point was that I think it is perfectly reasonable to have differing views over this on account of areas such as privacy, if I can have a personal view as a Minister. I am very happy to have a debate about whether there is a discussion to be had around privacy for micro-entities publishing all their information, given how personal that can be. I think it is perfectly legitimate for trusts, in many instances, to be considered private affairs, so long as the authorities themselves have the transparency of information that they need.
Lord Cromwell (CB)
To pick up on the noble and learned Lord’s point about consultation, I am sure we have all welcomed the multiple times that the Minister has referred to further discussion and further consultation about topics raised today and on the previous day of debate. I think we would welcome the chance to get our diaries out fairly soon and see when those discussions could actually take place.
The other separate and more pedantic point I wanted to make is that I think the Minister said—I agree with him largely on privacy, by the way—that the trusts are repositories of assets and do not transact business, although I am ready to be corrected. I am not sure that that is a fair representation. I think that many trusts own companies and the trustees run the companies and businesses that are held, as it were, in a holding group.
Lord Johnson of Lainston (Con)
I am not surprised that the noble Lord and a Member of this Committee has corrected me on that specific point; my tone may have been misunderstood. However, I hope he understood what I was trying to get at when I differentiated trusts from corporate entities or corporations themselves. They do business, and they must be regulated. If I could differentiate my language again, between a debate and a discussion, I am very keen to have a discussion with Members of this Committee about this matter, so we can certainly get diaries out and find a time over the coming weeks to look into this in more detail. It is a very important debate to have, and I would welcome as many participants in the industry as possible to join us in that discussion.
Given what I have said and the fact that this is being actively explored by the Government, please do not think that this discussion is somehow being shut down. As I say, this policy area is controlled by the Treasury, and it is very specific about that. I am comfortable that we will have the powers in this Bill to have the flexibility to ensure that we can, when the decision is taken, provide the right amount of transparency around trusts. As a result, I ask the noble Lord to withdraw his amendment.
Lord Agnew of Oulton (Con)
My Lords, with very deep reluctance, I will withdraw it, but I want to leave on the record that the self-proclaimed “very good” Amendment 76H could be truly excellent if the Government added the simple two-line sentence that I have offered in my amendment. I suggest that there are rarely times in legislation where so much can be achieved with so little and so quickly.
Baroness Blake of Leeds
“Beneficial owners in overseas territories
In section 51 of the Sanctions and Anti-Money Laundering Act 2018 (public registers of beneficial ownership of companies registered in British Overseas Territories), after subsection (5) insert—“(5A) The Secretary of State must take all reasonable steps to ensure that an Order in Council of a kind mentioned in subsection (2) comes into force on a date no later than 30 June 2023.””Member’s explanatory statement
This new Clause would amend the Sanctions and Anti-Money Laundering Act 2018 to ensure that an Order in Council requiring open registers of beneficial ownership in the British Overseas Territories, for the purposes of the detection, investigation or prevention of money laundering, comes into force no later than 30 June 2023.
Baroness Blake of Leeds (Lab)
My Lords, included in this group is Amendment 108, which I am sure the noble Lord, Lord Wallace, will refer to. Amendment 73A is straightforward. It seeks to amend provisions in the Sanctions and Anti-Money Laundering Act 2018 to require the introduction of open registers of beneficial ownership in each of the British Overseas Territories for the purposes of detection, investigation or prevention of money laundering, and for those to come into force no later than 30 June 2023.
Lord Wallace of Saltaire (LD)
My Lords, I support this amendment. I will speak to my Amendment 108, and first make a couple of preliminary observations.
The Minister referred to “eradicating” corruption—a wonderful aim. I do not recall any economy or political system that has entirely eradicated corruption, but minimising corruption is a necessary part of any market economy. I grew up within Barclays Bank. They moved us every five years; they moved their local staff because it was a way of minimising corruption—stopping my parents getting too close to their clients. That was the sort of petty corruption that unavoidably crept into the British financial system.
Now that we have an entirely different financial system the opportunities for corruption are very different. What we are trying to do here is minimise levels of corruption in a globalised economy and financial system. I say to the Minister: even if we were to succeed in eradicating corruption entirely in this country, which would require some quite astonishing changes in our culture, we would still import corruption from abroad, as we have painfully discovered in the past 30 years. The best that we can do is to hope to mitigate and minimise.
On trusts, secrecy is often an aid to tax avoidance or tax evasion. We all know that the boundary between avoidance and evasion is very delicate, managed by large numbers of well-paid accountants and lawyers based in London, the Crown dependencies and elsewhere, and that tax evasion is an economic crime.
I have been concerned by extent clauses in a number of Bills since I entered this House. I have been increasingly puzzled by the way in which such clauses are used, partly because they normally come at the end of a Bill by which time everyone is exhausted and does not want to discuss them. I note that, in the National Security Bill—the last Bill that I dealt with—Jersey and Guernsey were included in the extent clause, but the Isle of Man was not. Moreover, the sovereign base areas of Cyprus were included in the extent of the Bill but not most of the other overseas territories; I was unable to discover why the other overseas territories in which we have military bases, such as the Falklands, Tristan da Cunha and Ascension Island, were not included. The Minister then was unable to answer that question.
This is an area of quite astonishing ambiguity—deliberate ambiguity, in a sense. The Crown dependencies and the overseas territories are not part of the United Kingdom, but they are not foreign. They are governed under British law, but they do not immediately implement all changes in British law, as my noble friend remarked. That is very convenient but, occasionally, it leaves room for ambiguity, which can be exploited.
I remind the Minister that there have been substantial problems in some overseas territories; for example, the Turks and Caicos Islands and the BVI. There are, of course, enormous temptations in territories with a small population and a huge amount of money going through. We have seen that in the past in the Channel Islands—we very much hope that things are much better there now—and more recently in some of the Caribbean territories. So we must be careful and well aware that, if this Bill is to become a successful Act with enforcement, our close financial connections with the overseas territories and Crown dependencies must form part of what we address and part of what we make sure they follow.
In one of our briefings, we were told:
“We are comfortable with the journey that the overseas territories are on, but they are not yet there.”
We are concerned that they should get there, and in good time. We are all conscious that the overwhelming majority of properties owned by overseas entities are registered in the overseas territories, primarily the BVI. So why are they not in the extent clause, given that some Crown dependencies and overseas territories have been included in the extent clauses of other Bills passed in this Parliament? How are the Government going to ensure that the commitments made that the territories will follow changes in British legislation are carried through? How will we ensure that we follow up on that? I say that with a degree of embittered experience: I recall several occasions over the past 15 years on which Ministers from different Governments promised that changes in British law would be followed within a limited period by the overseas territories, only for us to discover three or four years later that those changes had not been implemented by some of them.
This is an important area; I know that the Minister will recognise how important an area it is. The personal, financial, accountancy and legal links between Britain, the Crown dependencies and the overseas territories are extremely close, intricate and fairly opaque. We therefore need, again, some reassurance that this Bill, when it becomes an Act with the hope that it will be enforced effectively, will be enforced throughout those British territories that are not part of the United Kingdom.
Baroness Bennett of Manor Castle (GP)
My Lords, it is a pleasure to follow the noble Lord, Lord Wallace of Saltaire, and to speak chiefly to Amendment 108, to which I attached my name. I entirely agree with everything he said, and indeed with the introduction to the group. I will just add a couple of points.
My first point is about the cost. A few years ago, Transparency International calculated that the economic damage resulting from corporate secrecy in the UK’s overseas territories alone significantly exceeded the UK aid budget. These are crimes that have real victims and real costs. We must not forget that. The fact is that one hand is operating one way and the other another way, unless we take some action.
The Atlantic Council is not necessarily an organisation with which I am always 100% in agreement, but it produced an article in January entitled “Authoritarian kleptocrats are thriving on the West’s failures. Can they be stopped?” It recommended that the UK should
“address the close connections between the City of London and British Overseas Territories and Crown Dependencies”.
A further recommendation was that the UK should:
“Reduce regulatory mismatches between the primary UK jurisdictions and the Crown Dependencies.”
There is a real hole here. We can drive a cart and horses through the gaps between what is happening here and what is happening in the Crown dependencies and overseas territories. To extend the metaphor a little, for which I apologise, we might be slamming the stable door, but we are leaving the barn door open unless we address this issue.
In thinking about how these two amendments are connected, and to join them up, let us be really charitable about the capacities of these overseas territories and Crown dependencies. The population of the 14 overseas territories is 270,000 people; that of the Crown dependencies is rather less. Let us be charitable when we think of the size of their Administrations and their capacities, and think about the extreme inequality of arms between the kleptocrats and their enablers and those organisations. Even if those territories and dependencies want to do something, with the best will in the world, how can they conceivably have the capacity to do it? We have a responsibility, given the UK Government’s role, for this economic crime Bill to include this coverage. This is protection, support and assistance, as well as something that protects the whole world.
Lord Faulks (Non-Afl)
My Lords, I have great sympathy for these amendments. I congratulate the noble Lord, Lord Wallace, on his tenacity on this issue, which I have noticed on a number of different Bills. He is quite right that this issue tends to come up at the fag end of debates, so it can be overlooked. It is very important.
I have one point to make about this. There is, of course, a distinction between the Crown dependencies and the overseas territories. I speak as a former Minister with responsibility for the Crown dependencies. Their position is such that, before legislation that includes them is brought forward—certainly before it is passed—there is a well-established convention whereby the Government consult the Crown dependencies before including them in legislation, certainly by way of an amendment. I ask the Minister whether any such consultations have taken place. If not, why not? This is clearly important, and it is a long-standing issue that the Crown dependencies will no doubt have strong views about, but we need to know them before legislating.
My second point is slightly different—the Minister is quite understandably looking elsewhere at this point. I was rather disappointed by his response on the question of trusts that we would not have a debate on them now. I gently remind him that the Joint Committee on the Draft Registration of Overseas Entities Bill, which I had the privilege of chairing, reported in 2019. It emphasised the importance of trusts as a potential vehicle for fraud. The committee’s report set that out between paragraphs 76 and 79 and said that the matter needed looking at as a matter of urgency. The committee was given assurances that it would be; it was not. It took the invasion of Ukraine before the register came in. Here we have the second and final chance to look at economic crime, which would include the use of trusts as a vehicle for fraud. In those circumstances, it is very disappointing to hear from the Minister that we will not have a debate on that now.
Lord Agnew of Oulton (Con)
My Lords, I support the amendments and want to make a couple of points. First, it is not a very ambitious request that we are making of these territories: simply that they have proper anti-money laundering processes in place. If we link it to my own amendment, which I have withdrawn, we are now in a position where we have no knowledge of the ultimate owner of many of those assets and no reassurance that there is any anti-money laundering going on.
Secondly, we need to remember that it is our reputation being damaged by these territories which are not stepping up to the plate, because they are using the principles of English law and that is how they are making a very good living out of it. I again ask my noble friend the Minister what is happening to move this along. It has been sitting around for a long time and it is damaging the reputation of this country.
Lord Garnier (Con)
My Lords, I have an interest to declare in that I am presently instructed by the Government of the Isle of Man in a legal matter. Under the new rules of the House, that is declared specifically in my entry in the register—I have just been checking. It is not a very exciting piece of work: I am required to report to the Isle of Man Government on the state of their legal services sector—I know that many of you will be very jealous of that exciting piece of work. One thing that the Isle of Man is particularly keen to have recognised is that it is an independent jurisdiction. Yes, the United Kingdom and the Isle of Man share through the Lord of Mann—namely, the sovereign—a head of state. Yes, it shares many of the legal traditions and concepts that we recognise in this jurisdiction, but it is a separate jurisdiction. It has its own parliament; indeed, its parliament is probably older than this one: the Tynwald. I have received instructions, not recently but in the past, from states within the Channel Islands and from British Overseas Territories. They are all fiercely proud of their independence as separate jurisdictions. I fully understand the points and the thrust of the arguments made by noble Lords who have spoken ahead of me, but we need to be careful about how we approach extending the ambit of this legislation.
To look as though we are retaining some sort of colonial mastership over those fiercely proud and independent jurisdictions is not a good look. It does not matter whether you are in the BVI, the Cayman Islands, Guernsey, Jersey or the Isle of Man; we just need to tread politely, quietly and with consensus. I accept that noble Lords have said that this has been going on for far too long and it is time that the UK Government got their act together and started to do something about it. Of course, that would be the ideal, but, often, the best is the enemy of the good. I want the Minister to know that although this is a forum in which he might seem, from time to time, on his own, he is not. No matter of which party we are or whether we do not belong to any party at all, we are trying to achieve workable legislation which is not only comprehensive and comprehensible but carries the respect of the people against whom it might bite, because law which is not respected is law which does not have any value or purpose.
If my noble friend the Minister sometimes thinks that he is the only man standing at the gate as the barbarian hordes—the noble barbarian hordes—assail him, would he please accept from me that he has our personal friendship and our professional respect? I am sure that this sentiment covers the whole of the Committee. We know the difficult job that he is doing so please, when we come to discuss this amendment, will he accept from me that I understand it is not easy to tell the Channel Islands, the Isle of Man or the British Overseas Territories that they must do what this Parliament says?
There will therefore be many discussions, it seems to me, between his department, the FCDO and the Treasury with their counterparts in these various jurisdictions. If we can bring them with us, as opposed to clobbering them with unilateral legislation, we will achieve a much longer lasting result—albeit that I entirely accept the purpose of the amendments from the noble Lord, Lord Wallace, and the noble Baroness, Lady Bennett of Manor Castle. Here at least, going with and coming alongside, as opposed to hitting head-on, is the way to go forward.
Lord Fox (LD)
I was going to take the benefit of what I hope will be some free consultancy, when it would otherwise be highly expensive, to ask a genuine question. Were His Majesty’s Government not to take the noble and learned Lord’s advice but wished to exert their will over these territories, is the means by which that is done through an order of the Privy Council or are there other ways of doing it? If the answer is yes—I see another noble Lord nodding—what are the precedents for that in recent times?
Lord Garnier (Con)
The noble Lord saw my noble friend Lord Faulks nodding. The fact that we went to the same school, the same college at Oxford and the same Inn of Court has absolutely no bearing on this, save to say that he will answer that question in a moment. I am sure he would wish to catch the Committee’s eye. That having been said, I want to finish on this rather wishy-washy point. I sympathise with what has been said in support of these amendments, but we need to take a step back and have a reality check to see how this would be received by the people against whom it will bite.
Lord Faulks (Non-Afl)
I will, then, as I usually accept that invitation. As I understand the position, an Order in Council is the mechanism. The convention and the arrangement with the Crown dependencies that I spoke of is not the same with the overseas territories, although the points made about consulting them very much apply.
Lord Wallace of Saltaire (LD)
If I may respond to the noble and learned Lord, Lord Garnier, since I have been involved in discussion on this on a number of previous Bills, we are normally assured by the Government as a Bill goes past that there are ongoing consultations with the CDs and the OTs, and that they have been assured that the key proposals will be incorporated into their domestic law within a limited period. As I said, there have been a number of occasions when that has not happened in some territories. It has often been the weakest territories concerned and, after all, this Government have spent a good deal of money on taking over the government of the Turks and Caicos—having to intervene where things have failed. This is rather like saying, “On most occasions, we do not expect most banks or overseas territories to be involved in any form of corruption, but sometimes some will be tempted”. Some may be overcome and that is what we are trying to guard against.
Lord Garnier (Con)
The noble Lord is right, and it has not been an easy history, but these small jurisdictions have a choice. I am well aware of the criminal cases currently going on in the Turks and Caicos, and the need for direct rule there. But I have seen too many occasions—not a vast number, but too many none the less—when these small jurisdictions are prepared to be seduced by China rather than maintain their relationship with the United Kingdom. We need to be careful that we do not force these smaller jurisdictions into the arms of the Chinese, when it would be much better for their well-being and ours if we were to maintain them within our own family. I will leave it there.
Baroness Blake of Leeds (Lab)
With apologies, as I am not sure whether this is an appropriate time to raise this, but given that our amendment refers to the Sanctions and Anti-Money Laundering Act, perhaps the Minister can explain what sensitive negotiations and discussions, as the noble and learned Lord, Lord Garnier, mentioned, have taken place and the reasons for the disappointing progress. It would be helpful to have a better understanding of why we have not been able to progress.
Lord Johnson of Lainston (Con)
I greatly appreciate the noble Baroness’s comment. I would be delighted to go through this in as much detail as I can. I am very aware, as a Minister in the department and someone guiding this legislation through, as a Peer in this House and as a member of the public, of the issues the Crown dependencies and overseas territories have when it comes to reputational issues surrounding financial probity. It has been well reported and widely discussed. I am very happy to comment on that and to come back to the Committee with more information on the specific work we are doing.
If noble Lords allow me to go through my notes, I should be able to answer some of the questions. I am very grateful to the Committee for the complimentary clerking advice we received from my noble and learned friend Lord Garnier and the noble Lord, Lord Faulks, although, since they both seem to have been educated in exactly the same way, I am not quite sure why they did not both have the same answer. That might be something to revisit.
I thank the noble Lords, Lord Coaker and Lord Wallace, who I have named in my brief, for their amendments; of course, the noble Baroness, Lady Blake, spoke to her part. Before I respond to the amendments, it will be useful for me to set out the long-standing constitutional relationship that exists between the UK Government and the Crown dependencies and overseas territories, although I do not want to repeat the very helpful comments made by noble Lords, particularly my noble and learned friend Lord Garnier.
The Crown dependencies and overseas territories are not part of the UK. It may seem obvious to state that, but it is very important. They are separate jurisdictions with their own democratically elected Governments responsible for their domestic affairs, including in these areas. The noble Lord, Lord Wallace, raised the National Security Bill, which I am advised would be more relevant since we are responsible for the national security of the Crown dependencies and overseas territories, or at least many of them—I am receiving reassuring nods. It would have been appropriate, in that instance, for there to have been some mention of them in the legislation. I will explain why there is no mention of the Crown dependencies and overseas territories in this Bill.
I make very clear my sympathy with the principles expressed in this debate. I cannot remember the exact phrase that the noble Baroness, Lady Bennett, used because the metaphor was very mixed, but it was something about there being no point shutting the stable door if we leave the barn door open. I very much agree with that principle; it would seem peculiar to go to all these lengths to make our system right if there were a backdoor through a Crown dependency or overseas territory, but I do not believe that will be the case. I assure the Committee that anything that happens in the UK has to have the additional level in terms of the equivalent regulatory framework to the PSC register, whatever the framework is so called, and so on.
We have a great deal of protection around us, but we should be aware of the fact that the Crown dependencies and dependent territories make their own laws in these areas. There is a well-established constitutional convention that the UK does not legislate for the Crown dependencies on domestic matters or otherwise intervene without their consent, except in very limited circumstances. I am sure that the noble Lord, Lord Faulks, would be comfortable talking to this, but it really is in very limited circumstances. We should be aware of that and very respectful of it, since we do far better collaborating in a more powerful way to ensure that our frameworks are meshed together so that we learn from and support each other rather than being heavy-handed, even in this specific and practical sense. Furthermore, the UK Government also recognise the long-established practice that the UK does not legislate on domestic responsibilities for the overseas territories without first consulting them, other than in exceptional circumstances.
I am grateful for the thrust of these amendments. On Amendment 73A, tabled by the noble Lord, Lord Coaker, I am aware that beneficial ownership registers in British Overseas Territories and Crown dependencies have long attracted significant interest from across the House, as I said earlier, and in general from the public. But it is worth mentioning that, when these types of amendment were tabled to Bills several years ago, we were in a very different place. The point is that all inhabited overseas territories and the Crown dependencies have now committed to introduce publicly accessible registers of company beneficial ownership.
Lord Wallace of Saltaire (LD)
I will simply comment on the capacity question, which the Minister raised. There is a clear distinction between our Crown dependencies and some of our smaller overseas territories. The Crown dependencies have a lot of qualified people, and I am well aware that, in recent years, they have increased their staff capacity to cope with the rising amount of international financial business they have been dealing with. One regrets that, in some of the smaller and, I have to say, weaker overseas territories, there is not enough capacity and trained staff. They are further away from the United Kingdom. There are reputational questions and costs if and when a major scandal breaks out, as in the Turks and Caicos Islands, to the UK’s standing in the world because they are under our protection, they follow UK law and they have the reputation of having UK law.
I am conscious that this is part of a wider problem in the global financial system. The argument has been made to me in the past by people from these territories: “After all, if people do not come here as their offshore financial centre, they’ll go to somewhere dodgier and smaller, perhaps in the Pacific rather than the Caribbean.” We are all conscious of there always being that set of issues, but the UK and its associated territories need to ensure that, in managing a complicated global financial system, our overall contribution is one of which we continue to be proud and that all those territories for which we are responsible maintain higher standards. That is what this is really about.
We recognise how much has been done and how well Crown dependencies have improved the quality of their oversight in recent years, but some territories will simply not have enough people who are prepared to live there for 12 months a year to deal with the quantity and complexity of the financial movements through them. That has to be a matter for our long-term concern. I would love to hear more about the Open Ownership charity that is involved in helping them with this, because we clearly have to assist them to develop their capacity to cope with an increasingly complicated, and often dodgy, set of offerings from countries with which we have to deal but which do not have the same standards as us.
Baroness Blake of Leeds (Lab)
I thank all noble Lords who have contributed to this group of amendments. We have uncovered some important areas, but the overarching consideration, as we know and as has been mentioned, is the damage to our reputation if this matter is not addressed.
I take some comfort from the Minister’s offer to meet us to talk this through in more detail, but I remain concerned about the very real question of progress. If the necessary progress has not been made across the piece by the end of the year, I would like to know exactly what the Government are intending.
Given the sensitivity about relationships and the different stages that places are at, which has been highlighted so well, it would be useful to know whether there is an established framework around support and approach to make sure there is consistency in achieving this. This is not a terribly ambitious request; it should be straightforward. I look forward to our further discussions and, with those comments, beg leave to withdraw my amendment.
Lord Leigh of Hurley
“Requirement to notify registrar of change of auditor
(1) The Companies Act 2006 is amended as follows.(2) In section 485 (appointment of auditors of private company), at the end insert— “(6) Following the appointment of a new auditor or auditors of the company, the company must give notice to the registrar within 10 working days of the date of change, along with the name and address of the auditor or auditors.”(3) In section 489 (appointment of auditors of public company), at the end insert—“(6) Following the appointment of a new auditor or auditors of the company, the company must give notice to the registrar within 10 working days of the date of change, along with the name and address of the auditor or auditors.””Member’s explanatory statement
This new Clause introduces a requirement for private and public companies to notify Companies House within 10 working days of the appointment of a new auditor or auditors, and provide the registrar with associated details.
Lord Leigh of Hurley (Con)
My Lords, for this amendment, I will add to my previous disclosures that I am a member of the Institute of Chartered Accountants in England and Wales. By qualification, 40 years ago, I rummaged around companies Acts hoping never again to see them. Sadly, here I am again, but hey ho. In fact, I rummaged around Sections 516 and 517 of the Companies Act 2006, as amended by the Deregulation Act 2015. This imposes an obligation on a company to tell Companies House if there has been a change of auditor, but not an obligation about the details of that change.
Lord Fox (LD)
Perhaps the noble Lord, Lord Leigh, can confirm this at the end of the debate, but it is not clear to me whether losing your auditor before you appoint another would be reportable within the subject of his amendment. That is a key diagnostic, which he did not mention, of trouble afoot within an organisation. One of the benefits that we would have seen if the fourth member of the Vaux/Fox/Faulks/Foulkes group—the noble Lord, Lord Foulkes—had been here is that he would have emphasised very fully that had we seen the loss of an auditor in a particular case, we would have known that there was trouble. So, there is another element to the argument made by the noble Lord, Lord Leigh, that, in a sense, this is a very good diagnostic.
Lord Ponsonby of Shulbrede (Lab)
My Lords, I agree with everything that has been said. I too was going to allude to the case of the SNP and to make the point about auditors resigning before they are replaced. That is obviously a warning sign. I am intrigued to hear the Minister’s response. It seems such a practical suggestion. I will leave it at that, because the ball is in his court.
Lord Johnson of Lainston (Con)
I thank my noble friend and guru Lord Leigh for his Amendment 73AA, and the noble Lords, Lord Fox and Lord Ponsonby, for their contributions. I assure my noble friend that this amendment is not necessary. The Government hear his comments loud and clear but, as with all outings at this Dispatch Box as a Minister, I am unable to give the purity of the answer that we might all prefer to hear.
However, I will say that the Government are taking forward reforms to audit and corporate governance regulation separately following the publication last year of our response to the White Paper consultation on restoring trust in audit and corporate governance. The White Paper considered the information that must be provided to Companies House when an auditor leaves office, so this covers the point about the auditor leaving office rather than necessarily the appointment of a new one; that is a core point that has been raised and heard. The Institute of Chartered Accountants in England and Wales—many noble Lords in this Room have declared an interest as being a member of that august body so they will know this already, although I am not—has raised with my officials the lack of up-to-date information on the Companies House register about the appointment of new auditors.
The Government are therefore already considering how the public record might be improved in respect of appointments of auditors, including possibly via a combination of notifying the appointment when it is made, as well as updating the register if needed as part of the annual confirmation statement. We covered the point about the auditor stepping down or leaving office. This could work in much the same way that it does for the identities of company directors, which I believe will satisfy this Committee. There are already secondary legislative powers in the Companies Act 2006 on the content of the confirmation statement, and amendments to this framework are already being considered as part of the implementation of the Government’s White Paper proposals on restoring trust in audit and corporate governance.
I hope that satisfies the Committee and I therefore ask my noble friend kindly to withdraw his amendment.
Lord Leigh of Hurley (Con)
I thank my noble friend. I am not surprised by his response, although one would have thought that a Bill on corporate transparency might stretch itself this far. In answer to what we might call the Vaux-Fox syndicate, when an auditor resigns, the company has to notify the Registrar of Companies of that within 14 days. I think it is a criminal offence not to do so, for both the company and the officer. That is pretty tight; it is just what is in the notice and making sure we are aware of what is going on thereafter. However, given the reassurances from my noble friend that the Government are beavering away day and night on the audit reform, I beg leave to withdraw my amendment.
Lord Johnson of Lainston
(b) in subsection (8), at the appropriate place insert—““disqualified under the directors disqualification legislation”—(a) in relation to a statement about a person delivered to the registrar for England and Wales or Scotland, means that the person falls within any of the entries in the first column of Part 1 of the table in section 159A of the Companies Act 2006;(b) in relation to a statement about a person delivered to the registrar for Northern Ireland, means that the person falls within any of the entries in the first column of Part 2 of that table.””Member’s explanatory statement
This amendment removes a requirement to make a statement in circumstances that can in fact never exist and is otherwise consequential on the amendments to page 94 and page 96, line 20, which are tabled in the Minister’s name.
Lord Johnson of Lainston (Con)
My Lords, I will speak first to government Amendments 73B to 73E, 73G to 73J, 73N, 74A and 74B—I hope I have read them out in the correct order—on the application of disqualification provisions to general partners and registered officers. I believe these amendments are very uncontentious but stand ready to be corrected by noble Lords in this Committee.
These amendments clarify certain parts of the Bill concerning disqualified officers in limited partnerships. They ensure that the restrictions introduced by the Bill on disqualified persons in relation to companies, which noble Lords will recall were debated and agreed on the first day in Committee, will apply correctly and coherently in the context of limited partnerships.
Specifically, Amendments 73B, 73C and 73G adapt the definition of a disqualified person, as inserted by the Bill under the Companies Act 2006, to general partners and registered officers. This will determine how a disqualification under the directors disqualification legislation affects the ability to be a general partner, or a registered officer of a corporate general partner in a limited partnership, and prevents disqualified persons being registered as such by the registrar. If I can summarise them correctly, they basically mean that if you are disqualified as a company director you cannot be a general partner of a limited company, and vice versa—which obviously makes great sense, because for some reason that was not necessarily the case.
Amendments 73B, 73D to 73F, 73N, 74A and 74B remove triggers or references concerning situations that cannot, in fact, exist and replace them with clearer text. This is because the Bill currently provides for general partners and registered officers to retain their management role if they are disqualified but have a court’s permission to act. However, unlike the position for companies, the law does not currently allow the courts to disqualify a person from acting in the capacity of a general partner or registered officer. Consequently, no court is allowed to grant permissions to act in such a capacity despite disqualification. If you cannot be disqualified, you cannot be permitted to act if disqualified, if that is the correct summary.
We do, however, intend to make changes related to this in secondary legislation so that people can be disqualified from acting as a general partner of a limited partnership and so that a court can grant permissions for disqualified general partners to act in limited partnerships where appropriate. We have discussed this and, historically, there are cases in which permissions for disqualified general partners and persons are required to facilitate necessary corporate transactions.
Section 7A of the Limited Partnerships Act 1907 and the powers in Clauses 149 and 150 allow regulations to be made to apply provisions concerning companies, including the director disqualification legislation, to limited partnerships. This includes allowing disqualified individuals to be disqualified from acting as a general partner and be given permission to act in a limited partnership. However, until these regulations are made, it is essential that the primary legislation reflects the current state of the law and is clear. These amendments, I hope the Committee will agree, achieve that. They are needed as they will remove provisions relating to court permissions, which, as I stated earlier, cannot be applied. Amendments 73B, 73E, 73H and 73J will also ensure that this change is reflected in the statements that must be delivered to the registrar in relation to the status of a general partner and a registered officer.
Finally, Amendments 73H and 73J ensure that the meaning of “disqualified” is properly applied in respect to the general partners’ ongoing duty to take any steps necessary to ensure that a disqualified general partner is removed from the partnership. This group of amendments is therefore necessary to ensure clarity regarding the definition of disqualified, and the obligations on individuals in relation to disqualified general partners and registered officers. They will make the legislation clearer and stop bad actors partaking in the management of limited partnerships.
Amendments 76A to 76G concern extending the application of the company director disqualification legislation to other entities in Northern Ireland. Currently, Clause 150 of the Bill gives the Secretary of State the power to amend the Company Directors Disqualification (Northern Ireland) Order 2002 in relation to relevant entities in Northern Ireland. On reflection, because this power will be used to amend a piece of Northern Irish legislation in a devolved area, these amendments extend the power to amend the order to the Department for the Economy in Northern Ireland. They also require the Secretary of State to obtain consent from the department before making any amendments. The amendments tabled will not result in a change in policy or in the intended use of these regulations.
I therefore believe that these are reasonable amendments. They will enable the continuation of collaborative working across the devolved nations while upholding the balance of devolved law. I believe that they are uncontentious; I have had the opportunity to discuss them broadly with noble Lords here. I very much hope that we can move on this and that noble Lords will support the various amendments I have proposed so that we can continue in our work debating other issues.
Lord Fox (LD)
My Lords, I have just a couple of questions for the Minister. First, can he confirm that, in seeking to define a disqualification more clearly and explicitly—I think that is what he said—the intention is not to change that definition but merely to codify it? Secondly, in what circumstances does the Minister envisage a disqualified director being allowed, in essence, to be reinstated? In what circumstances do the Government think that might be necessary, so to speak?
Lord Johnson of Lainston (Con)
The concept of disqualification does not change. As I am sure noble Lords are aware, these amendments simply bring historical legislation in line and tidy up some points in the Bill that apply to the provision on directors acting as qualified directors when they have been disqualified but cannot actually be disqualified under the original legislation. There is not enough coherence in what happens between limited partnerships and companies. If an individual, whatever you wish to call them—a general partner, a director or so on—is disqualified, they should not be able to be a corporate person in another corporate entity, however you wish to describe it; I think we all agree with that. These amendments clearly bring consistency here. There are no changes to any expectations; this is just good practice and, as I say, tidies up important areas of consistency.
On when a director or limited general partner would be enabled to continue in operation, this would relate specifically to discharging vital duties to ensure that a company could be wound up or, if necessary, some form of share sale or transfer could be authorised. This measure is necessary to ensure that. As I understand it, the Secretary of State directs exceptions to disqualification; I will correct that if I am mistaken. It happens in exceptional circumstances; the cause is normally that specific things need to be done to release assets, make payments, et cetera. A good example is that, if a board was disqualified for good reason but there were suppliers that needed to be paid, it would not be unreasonable for one of the disqualified directors to be able to pay the suppliers. It is specific, the idea being that, once you have disqualified a director, they are disqualified although, according to this amendment, they may be enabled to perform specific functions. That is logical and common sense.
I believe that concludes my proposal.
Lord Johnson of Lainston
“(3) A general partner in a limited partnership is “disqualified under the directors disqualification legislation” if— (a) where the limited partnership is registered in England and Wales or Scotland, the general partner falls within any of the entries in the first column of Part 1 of the table in section 159A of the Companies Act 2006;(b) where the limited partnership is registered in Northern Ireland, the general partner falls within any of the entries in the first column of Part 2 of that table.”Member’s explanatory statement
This amendment makes it clear that only the first column of the table in section 159A of the Companies Act 2006 is relevant to determining whether a general partner is disqualified under the directors disqualification legislation. This is because a disqualified general partner cannot be given permission to act.
Lord Johnson of Lainston
“(a) who is one of the general partner’s managing officers,(b) who is not disqualified under the directors disqualification legislation (see subsection (8)), and(c) whose identity is verified (within the meaning of section 1110A of the Companies Act 2006).”Member’s explanatory statement
This amendment is consequential on the amendment to page 93, line 36, which is tabled in the Minister’s name. That amendment introduces a new definition of “disqualified under the directors disqualification legislation” that applies for the purpose of section 8A of the LPA 1907.
(b) be accompanied by a statement by the individual who is the proposed registered officer confirming that the individual—(i) is one of the general partner’s managing officers,(ii) is not disqualified under the directors disqualification legislation (see subsection (8)), and(iii) is an individual whose identity is verified (within the meaning of section 1110A of the Companies Act 2006).”Member’s explanatory statement
This amendment removes a requirement to make a statement in circumstances that can in fact never exist and is otherwise consequential on the amendment to page 93, line 36, which is tabled in the Minister’s name.
Member’s explanatory statement
This amendment is consequential on the amendment to page 96, line 20, which is tabled in the Minister’s name.
“(1A) The registered officer of a general partner in a limited partnership is “disqualified under the directors disqualification legislation” if—(a) where the limited partnership is registered in England and Wales or Scotland, the registered officer falls within any of the entries in the first column of Part 1 of the table in section 159A of the Companies Act 2006;(b) where the limited partnership is registered in Northern Ireland, the registered officer falls within any of the entries in the first column of Part 2 of that table.”Member’s explanatory statement
This amendment makes it clear that only the first column of the table in section 159A of the Companies Act 2006 is relevant to determining whether a registered officer is disqualified under the directors disqualification legislation. This is because a disqualified registered officer cannot be given permission to act.
Lord Johnson of Lainston
Member’s explanatory statement
This amendment removes a requirement to make a statement in circumstances that can in fact never exist.
Member’s explanatory statement
This amendment removes a requirement to make a statement in circumstances that can in fact never exist.
Lord Johnson of Lainston
“Power to make provision about winding up
After section 29 of the Limited Partnerships Act 1907 (inserted by section 130 of this Act) insert—
“29A Power to make provision about winding up(1) The Secretary of State may by regulations make provision in relation to the winding up of a limited partnership under section 28 or 29 that corresponds or is similar to any provision of the Insolvency Act 1986 or the Insolvency (Northern Ireland) Order 1989 (including any provision of that Act or Order that relates to the allocation of jurisdiction or distribution of business between courts in any part of the United Kingdom).(2) Before making regulations under subsection (1) the Secretary of State must—(a) obtain the consent of the Department for the Economy in Northern Ireland, so far as the regulations relate to limited partnerships registered in Northern Ireland; (b) obtain the consent of the Scottish Ministers, so far as the regulations relate to limited partnerships registered in Scotland.(3) The provision that may be made by regulations under subsection (1) by virtue of section 35(1) includes provision amending, repealing or revoking provision made by or under either of the following, whenever passed or made—(a) an Act;(b) Northern Ireland legislation.(4) Regulations under this section are subject to the affirmative resolution procedure.””Member’s explanatory statement
This amendment would mean that the Secretary of State can make provision corresponding or similar to any provision of the Insolvency Act 1986 or the Insolvency (Northern Ireland) Order 1989 to govern the winding up of limited partnerships under new section 28 or 29 of the Limited Partnerships Act 1907.
“Winding up of limited partnerships: concurrent proceedings
(1) The Limited Partnerships Act 1907 is amended as follows.(2) In section 6 (modifications of general law in case of limited partnerships), for subsection (3D) substitute—“(3D) Subsections (3A) and (3B) have effect subject to any order of a court as to the winding up of the affairs of the partnership and any award of sequestration of the partnership’s estate under the Bankruptcy (Scotland) Act 2016.”(3) After section 29A (inserted by section (Power to make provision about winding up) of this Act) insert—“29B Winding up of limited partnerships: concurrent proceedings(1) Where a petition under section 28 in respect of a limited partnership is pending, a general partner of the limited partnership who is or becomes aware of any of the circumstances mentioned in subsection (3) must notify the court to which the petition was presented.(2) Where an application under section 29 in respect of a limited partnership is pending—(a) a general partner of the limited partnership who is or becomes aware any of the circumstances mentioned in subsection (3) must notify the court to which the application was made, and(b) if the application was made by a person other than the Secretary of State, the applicant must notify the court to which the application was made if the applicant is or becomes aware of any of the circumstances mentioned in subsection (3).(3) The circumstances are that—(a) a petition for sequestration of the limited partnership’s estate under the Bankruptcy (Scotland) Act 2016 is before a sheriff,(b) an application to the Accountant in Bankruptcy for sequestration of the limited partnership’s estate under that Act is pending,(c) sequestration has been awarded by virtue of any such petition or application and the limited partnership’s estate is being sequestrated,(d) a trust deed in respect of the limited partnership’s estate has been sent to the Accountant in Bankruptcy for registration under that Act and the registration has not been refused,(e) a protected trust deed (within the meaning of that Act) is in force in respect of the limited partnership’s estate, (f) an application by the limited partnership for approval of a debt payment programme under the Debt Arrangement and Attachment (Scotland) Act 2002 is pending, or(g) such a programme has been approved under that Act and has not been completed.(4) A person is not required to notify the court of circumstances under subsection (1) or (2) if another person has notified the court of those circumstances.(5) If a person fails to comply with subsection (1) or (2) an offence is committed by—(a) the person, and(b) if the person is a legal entity, any of its managing officers who is in default.(6) A person guilty of an offence under this section is liable on summary conviction—(a) in England and Wales, to a fine;(b) in Scotland or Northern Ireland, to a fine not exceeding level 5 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 5 on the standard scale.(6) A managing officer is “in default” for the purposes of this section if they authorise or permit, participate in, or fail to take all reasonable steps to prevent, the contravention.(8) But a corporate managing officer does not commit an offence as a managing officer in default unless one of its managing officers is in default.(9) Where any such offence is committed by a corporate managing officer the managing officer in question also commits the offence (subject to subsection (8)).(10) For the purposes of this section a petition or application is “pending” if it has been presented or made and it has not fallen, been withdrawn or been determined.29C Power to amend circumstances for notification under section 29B(1) The Secretary of State or the Scottish Ministers may by regulations amend the list in section 29B (3).(2) Before making regulations under subsection (1) the Secretary of State must obtain the consent of the Scottish Ministers.(3) Regulations made by the Secretary of State under subsection (1) are subject to the affirmative resolution procedure.(4) Regulations made by the Scottish Ministers under subsection (1) are subject to the affirmative procedure (see Part 2 of the Interpretation and Legislative Reform (Scotland) Act 2010 (asp 10)).””Member’s explanatory statement
This amendment would mean that if a petition has been presented under new section 28, or a person has made an application under new section 29, a general partner or person who made the application under new section 29 must notify the relevant court about other concurrent proceedings.
“Sequestration of limited partnerships: concurrent winding up proceedings
(1) The Bankruptcy (Scotland) Act 2016 is amended as follows.(2) In section 17 (concurrent proceedings for sequestration or analogous remedy)—(a) in subsection (2)(b), after “awarded” insert “and the debtor’s estate is being sequestrated”;(b) in subsection (2)(c)— (i) omit “has been made”;(ii) after “estate” insert “is pending”;(c) in subsection (2)(d), after “application” insert “and the debtor’s estate is being sequestrated”;(d) in subsection (2)(g), after “under” insert “section 27 of the Limited Partnerships Act 1907,”;(e) after subsection (2)(g) insert—“(ga) such a petition has been granted,(gb) an application in respect of the debtor is before a court under section 28 of the Limited Partnerships Act 1907,(gc) such an application has been granted,”;(f) after subsection (7) insert—“(7A) For the purposes of subsection (2)(c), a debtor application is “pending” if it has been made and has not fallen, been withdrawn or been determined.”(3) In section 18 (powers in relation to concurrent proceedings)—(a) in subsection (1), for “(g)” substitute “(gc)”;(b) in subsection (2), for “or (g)” substitute “, (g), (ga), (gb) or (gc)”;(c) in subsection (8), for “(g)” substitute “(gc)”.”Member’s explanatory statement
This amendment would mean that, if a limited partnership is in the course of sequestration proceedings, the petitioner, debtor or creditor must notify the sheriff court or AiB if they become aware of winding up proceedings under new section 28 or 29 LPA 1907 in relation to the limited partnership.
Lord Johnson of Lainston
Member’s explanatory statement
This amendment is consequential on the amendments to page 95, line 23 and page 95, line 39, which are both tabled in the Minister’s name.
Lord Agnew of Oulton
“Limited partnerships: registration of persons of significant control
(1) The Secretary of State must by regulations make provision about the registration of persons of significant control in relation to limited partnerships. (2) For the purposes of regulations under this section, “persons of significant control” may include persons with a right to—(a) 25% or more of the surplus assets on winding up,(b) a voting share of 25% or more,(c) appoint or remove the majority of managers,(d) exercise significant influence or control over the business, or(e) exercise significant influence or control over a firm which would be a person of significant control if it were an individual.(3) No regulations to which this section applies may be made unless a draft of the statutory instrument containing the regulations (whether or not together with other provisions) has been laid before, and approved by a resolution of, each House of Parliament.”Member’s explanatory statement
This amendment creates an obligation on the Secretary of State to make new provisions for Limited Partnerships to be brought into the PSC register. This is intended to improve transparency in relation to Limited Partnerships in line with companies.
Lord Agnew of Oulton (Con)
My Lords, I will treat Amendments 74 to 76 together because they all try to achieve the same thing: to ensure a similar level of transparency for limited partnerships, limited liability partnerships and Scottish limited partnerships as we are trying to achieve for companies.
I had a brief discussion with my noble friend the Minister before we started, and he felt that I was flawed in my approach. I absolutely recognise that he has a more formidable intellect than I have and has at his disposal a very accomplished drafting team. I may not have the amendments exactly right, so I would rather consider them more as probing amendments to understand why we cannot not have the same level of transparency for these entities as we have for companies.
One of the points my noble friend made was that you should not have to have a natural person as one of the partners. My answer is that, if you do not, you are back to my original Amendment 73, because you just cascade off into another miasma of entities where there is no transparency. I would be interested to hear from the Minister how we will sort out this problem if my amendments are not adequate.
I have an example of an LLP, Atlas Integrate Services LLP, that was incorporated in September 2018, where the person of significant control was two months old. My noble friend said he wished his own children were showing such entrepreneurial flair so early in their careers. This person was also married at two months but, more importantly, the incorporation document stated:
“This person holds the right, directly or indirectly, to appoint or remove a majority of the persons who are entitled to take part in the management of the LLP”.
Will the Bill get rid of that sort of behaviour? That is my concern at the moment. There are apparently some 4,000 beneficial owners across the database who are aged two or less. This is an issue, and perhaps the brave new world of the Bill will eliminate it. I would be grateful for reassurance that that will happen or to hear what the plan is.
Lord Coaker (Lab)
My Lords, I do not know whether the amendments from the noble Lord, Lord Agnew, are flawed but, if I followed them correctly, Amendments 75 and 76 in particular seek to put a human face on limited partnerships, so that at list one partner is a natural person and they are not all corporate entities.
Before I make a couple of general comments about that, can I ask the Minister a question? I could not make out from the various debates I have read about this whether the Government are saying that they will look at it in secondary legislation or that they are not going to do it. I will be corrected if I am wrong, but I thought I had read that the Government are intending to require this, but by secondary legislation.
I do not think it is adequate to require this by secondary legislation. What the noble Lord, Lord Agnew, alighted on goes to the point made earlier by the noble Lord, Lord Vaux, which has run through all the Committee—namely, who is the ultimate beneficiary? Who, in the end, gains from these various business practices? The most obvious way around that is to require a human face or somebody who is actually real.
The Minister, who is a businessman himself as well as a government Minister, said that he understands the importance of keeping public opinion on side. The public have lost trust in business from the many ways in which bad business is conducted. We had debates earlier about trusts and about privacy, and I think the Minister disappointed the Committee by saying that this was not the place for a debate about privacy and that that would be for a further debate.
The Minister is saying that the amendment from the noble Lord, Lord Agnew, is flawed because this will be dealt with through secondary legislation. My view is that it is of such symbolic importance that, somewhere along the line, the Bill requires a human face. I know that this is in respect to limited partnerships, but I think the noble Lord, Lord Agnew, has alighted on quite an important point. We continually go back to this: how do we get transparency, restore public confidence and hold bad businesses to account? How do we overcome the fact that large numbers of people, including me, think that trusts, corporate entities, limited partnerships, et cetera, are in some instances set up to hide what is actually going on? That is something that the amendment from the noble Lord, Lord Agnew, is trying to do. Ultimately, it makes a human face, somebody who is a Mr, Ms, Mrs or whatever, responsible for this aspect of business. They will be held to account.
I say to the noble Lord, Lord Agnew, that there is nothing flawed about making at least one partner in a limited partnership a natural person. It is a really important statement about how business ought to operate, which should be required not through secondary legislation but in the Bill, to show how the Government intend to ensure that we have proper business practice that is consistent with the will of Parliament. One of the ways of doing that is to ensure that, instead of some faceless bureaucracy somewhere, however it is dressed up legally, we actually have an individual who can be held to account.
Lord Fox (LD)
I will be very brief. I think that your Lordships need once again to thank the noble Lord, Lord Agnew, for his ability to get around the issues. This is a genuine issue around seeking to obfuscate the ownership of particular assets. The noble Lord seemed to have some confidence that the Minister will help us on this. The point here is that this is a genuine issue about which the Government should genuinely be concerned.
This extends beyond fraud. We were talking about trusts. One of the issues that came up after the Grenfell Tower disaster was that people found they could not know who owned the accommodation they were living in because of the protections that we have been discussing today. So they could not have a realistic conversation about whether their landlord would make their residence safe again. That is another issue, which is separate from this Bill, but it gives lie to the point that this is used to hide ownership for a variety of different reasons.
I look forward to the Minister achieving the optimism that the noble Lord, Lord Agnew, just expressed. I also thank the noble Lord for introducing the phrase “natural person”, which I have not come across before. Is that a legal definition of a human? That would be an interesting and useful thing to know for the future. With that, we on these Benches fully support these amendments.
Lord Johnson of Lainston (Con)
As always, I am grateful to noble Lords for their contributions to this debate. I have been reassured that, for the purposes of this debate, a “natural person” is a human. There was nodding behind me in the Box, which is reassuring.
Lord Johnson of Lainston (Con)
Do we have some artificial intelligence in the Civil Service Box? I think that we have natural persons’ intelligence. While I have this opportunity—I am sure that I say this on behalf of the Committee—I would like to say that the officials behind this Bill are extremely hard-working and focused; they have done everything they can to deliver a very complex piece of legislation. They have been very helpful to me and my colleagues personally and to the Ministers taking the Bill through the other place. I hope noble Lords feel that they have interacted with them appropriately. I know that they continue to stand ready to support us as we craft what I think is a magnitudinous piece of legislation that will have significant positive ramifications in the decades ahead.
I turn to the amendments presented by my noble friend Lord Agnew. I have taken advice on elements of them and their technical relevance to the Bill so, when the noble Lord, Lord Coaker, suggested that they were somehow not relevant, that was a private, legal and specific statement; it was not a philosophical one. They are very relevant to the Bill and at the core of much of what we are trying to establish: who is behind the companies and corporate entities?
The comment from the noble Lord, Lord Fox, about the ownership of property following the Grenfell Tower tragedy is a very good example. We hope that the reforms that we are making will ensure that we know who is behind corporate activity and ownership of property in this country. We have made huge strides in doing so and the Bill is very important. That is not to say that it cannot be improved but, where we feel we are including these principles, we do not suggest that noble Lords unnecessarily improve it further or confuse it. I rely to some extent on the draftsmen who advised me on this; I hope that the Committee sees this as well intentioned, in the way it is being presented.
I will first speak to Amendment 74. I commend my noble friend’s intention to increase the transparency of limited partnerships. I stress again that there is a difference between a limited partnership in Scotland, a limited partnership in England, Wales and Northern Ireland, a limited liability partnership across the United Kingdom and a limited company. They all operate slightly differently in the different jurisdictions. Please bear this in mind, as we have drafted this legislation to ensure that we have transparency across all the different concepts and principles in the right way.
I know that my noble friend Lord Agnew shares the same concerns that Dame Margaret Hodge has expressed previously. I have had the privilege of meeting her personally, as well as hearing her views, which have been extremely helpful in informing my knowledge base around this debate.
The proposed new clause would duplicate the Scottish Partnerships (Register of People with Significant Control) Regulations 2017. Scottish limited partnerships have legal personality, as noble Lords will know, which means that, among other things, they are able to own assets, enter into contracts and hold bank accounts. This results in a greater degree of opacity around Scottish limited partnerships, which is one of the features that the Bill is specifically designed to tackle.
However, as noble Lords will know, English, Welsh and Northern Irish limited partnerships are required to register with Companies House. While they are, they do not possess a legal personality separate from that of their partners. This means that it is the general partners themselves who transact on behalf of the partners. One of our senior officials likened it to a marriage, if that helps to clarify that point, in the sense that, if you are married and you own a home, the marriage does not own the home, nor does the couple; the partners—the husband and wife—own the property. I hope that that makes it clearer to some extent; it certainly did for me, although I will not go into my own home ownership percentages during this debate.
I stress that this Government completely agree with the principle that we should have greater transparency over who is managing and controlling a limited partnership. There is much in the Bill that will achieve exactly that. This is very important. I know that my noble friend Lord Agnew and the noble Lords, Lord Coaker and Lord Fox—indeed, all noble Lords in the Committee—take this extremely seriously. In fact, it is the core principle of the Bill, which includes, to go back to the specific moment, a range of measures that will make it mandatory for limited partnerships to submit a much greater range of information about their partners, including their current and former names, addresses and dates of birth.
The general partners of limited partnerships who have management responsibility—there is, of course, a difference—will be required to have their identities verified. Where a general partner is a corporate entity, it must name a managing officer with a verified identity who can be contacted about the limited partnership. That is very important as well and goes significantly further.
Lord Agnew of Oulton (Con)
Can my noble friend confirm that all the information he has just listed will be available for public inspection so that we do not get back into this cul-de-sac of my earlier concerns?
Lord Johnson of Lainston (Con)
I believe that I can confirm that but I will ensure that those facts are properly presented. It is clearly helpful for us to be specific on that.
Lord Coaker (Lab)
If somebody fails to comply properly with registering their PSC, that is a criminal offence, as I understand it. Can the Minister confirm that failing to register the PSC properly is a criminal offence? Secondly, what are the penalties for that offence?
Lord Johnson of Lainston (Con)
I am going through a slightly different point in this amendment, if the noble Lord will forgive me. I can confirm that it is a criminal offence. There is a published tariff that varies according to jurisdiction. If noble Lords do not mind, we will present that. I believe that there might be sections of the criminal tariffs in the Bill, but it is important as this is criminality. Perhaps one of the noble Lords in the Committee will be able to extract the tariff from the Bill but I will certainly write to noble Lords. They are significant penalties and fines; it is more than six months in prison in some jurisdictions. It depends on whether it is tried in Scotland and so on. I do not have all those details to hand but we will clarify that.
This is very serious. Criminality in the corporate world is an important element of what we are trying to prevent. As noble Lords know, we will discuss the “failure to prevent” principles in the next day of Committee. It changes significantly, as has been seen to be successful, in jurisdictions such as the United States of America. As the noble Lord has raised before in terms of public participation in our belief in a liberal, democratic, property-owning capitalist system, it is felt that, if we do not punish the perpetrators of financial crimes and it is felt that they are getting away with it, through either their being unable to easily prosecuted or their not being punished severely, it brings the system into disrepute and causes significant long-term philosophical and societal damage.
We look across the Atlantic at the United States and feel that it takes a different view. Financial crime is treated there as serious and significant crime, and commensurate penalties go with it. The case of Madoff was raised, where the initial tariff was a pretty significant landmark sentence—many hundreds of years, if I am not mistaken. It was certainly over 100 years or close to it, which obviously shows the principles by which that country approaches this point. While we are not operating under similar tariffs, it is important that we see criminal acts in financial crimes as significant. The tariffs around that need to reflect it, but I am happy to provide further information.
Perhaps I may finish this piece, because I hope it is relatively straightforward and that Committee members will be reassured by what we are doing. We will not support this amendment and I will ask the noble Lord to withdraw it, but the principles around making sure that we have transparency and identifiable actors in corporate structures are clearly made.
On the case of the two month-old married individual who was registered as a beneficial owner of the entity that my noble friend Lord Agnew cited, the point actually raised is that it has been recorded. It will certainly now be possible, if not essential—to some extent, with a situation as significant as that, it should have been possible—that Companies House now investigates that type of registered entry. I raise that in the sense that we are trying to ensure that the information is provided, which will set off alarm bells and allow for inquiry. We cannot prevent people from false entry. What we can do is to ensure that the penalties are there to discourage it, the investigative powers and data-scraping are sufficient to enable us to pursue it, and the data we have is clean and clear.
I do not have too long to go on these two amendments, if noble Lords will indulge me. I wish to stress to my noble friend Lord Agnew that this Government completely agree with the principle that we should have greater transparency over who is managing and controlling a limited partnership. There is much in this Bill which will achieve exactly that. The Bill includes a range of measures that will make it mandatory—I restate this—for limited partnerships to submit a much greater range of information about their partners, including their current and former names, addresses and dates of birth.
The general partners of limited partnerships will be required to have their identities verified. The PSC regulations apply to certain legal entities, including incorporated bodies such as companies and LLPs, and are about exposing who controls them. This can be otherwise unclear, given the corporate structure of those entities. While companies and partnerships share many similar characteristics, they are nevertheless fundamentally different. A limited partner, for example, does not have voting rights in the way that a shareholder does and, unlike an LLP, there is nothing in law which would force a limited partnership to have a written partnership agreement—I think this dates back to the 1880s—though many will have one.
As I have said, partnerships in England, Wales and Northern Ireland are registrable business relationships, not separate legal personalities. As such, they cannot be beneficially owned in the same way that companies and LLPs can. It would take a fundamental review of partnership legislation more broadly to apply beneficial ownership-style transparency measures to English and Welsh, and Northern Irish, limited partnerships in the way that my noble friend intends. For these reasons, I ask my noble friend to withdraw his amendment but I am very comfortable about discussions to ensure that he and any other members of the Committee are comfortable that what we are doing achieves these ends.
Amendments 75 and 76, also tabled by my noble friend Lord Agnew, would require limited partnerships and limited liability partnerships to have at least one partner who is a natural person. The Government consulted extensively on the reforms to these corporate structures. It was clearly found that corporate partners can be a legitimate and critical part of certain UK fund structures, allowing them to operate effectively. While I understand the intent of these amendments and share the desire to tackle opaque chains of corporate partners in partnerships, as with companies, having discussed the principles of these structures, it is difficult to suggest that now would be an appropriate time to make such a change.
Clause 144 already contains powers which will enable restrictions to be placed on corporate partners, as with corporate directors of companies. However, limited partnerships and limited liability partnerships have very different corporate structures to companies. Therefore we must have careful consideration and consultation is needed before any restrictions are made.
Lord Agnew of Oulton (Con)
I thank my noble friend the Minister for his comprehensive answer. He has been very reassuring.
I just want to re-emphasise the important points made by the noble Lords, Lord Coaker and Lord Fox, about the principle of accountability. If we go back to my slightly specious example of the two month-old child, we have the identity of that child so we have transparency but where is the accountability? That is what I am worried about. However, I accept that my noble friend is committed to both transparency and accountability and believes that this Bill, accompanied by the other partnerships Bill that he mentioned, will deliver them, so I beg leave to withdraw my amendment.
Lord Johnson of Lainston
Member’s explanatory statement
This amendment is consequential on the amendment to page 95, line 23, which is tabled in the Minister’s name.
Member’s explanatory statement
This amendment is consequential on the amendment to page 95, line 39, which is tabled in the Minister’s name.
Lord Johnson of Lainston
Member’s explanatory statement
This amendment is consequential on new section 29C of the Limited Partnerships Act 1907 which is inserted by new Clause (Winding up of limited partnerships: concurrent proceedings)(which is inserted after Clause 130 of the Bill).
Lord Johnson of Lainston
Member’s explanatory statement
This amendment allows the Department for the Economy to make regulations under new Article 25D of the Company Directors Disqualification (Northern Ireland) Order 2002.
“(2A) The Secretary of State must obtain the consent of the Department before making regulations under this Article.”Member’s explanatory statement
This amendment requires the Secretary of State to obtain the consent of the Department for the Economy before making regulations under new Article 25D of the Company Directors Disqualification (Northern Ireland) Order 2002.
Member’s explanatory statement
This amendment means that regulations made by the Department for the Economy under new Article 25D of the Company Directors Disqualification (Northern Ireland) Order 2002 cannot amend an Act of Parliament.
“(6A) The provision which may be made by regulations made by the Department by virtue of paragraph (5) includes provision amending provision made by or under Northern Ireland legislation, whenever passed or made.”Member’s explanatory statement
This amendment means that regulations made by the Department for the Economy under new Article 25D of the Company Directors Disqualification (Northern Ireland) Order 2002 can amend Northern Ireland legislation.
Member’s explanatory statement
This amendment is consequential on the amendment to page 136, line 10, which is tabled in the Minister’s name.
Member’s explanatory statement
This amendment is consequential on the amendment to page 136, line 10, which is tabled in the Minister’s name.
“(9) Regulations made by the Department under this Article are subject to negative resolution.”Member’s explanatory statement
This amendment is consequential on the amendment to page 136, line 10, which is tabled in the Minister’s name.
Lord Johnson of Lainston
“Registration of information about trusts
(1) Paragraph 8 of Schedule 1 to the Economic Crime (Transparency and Enforcement) Act 2022 (required information) is amended as follows.(2) In sub-paragraph (1), for paragraphs (d) to (f) substitute—“(d) the specified details of each beneficiary under the trust;(e) the specified details of each settlor or grantor and, in relation to any settlor or grantor that is a legal entity, the specified details of any person who at the time at which the trust is settled—(i) is a registrable beneficial owner in relation to that entity (if it is overseas entity), or(ii) would be a registrable beneficial owner in relation to the entity if that entity were an overseas entity;(f) the specified details of any interested person under the trust and the date on which they became an interested person.”(3) After sub-paragraph (1) insert—“(1A) In sub-paragraph (1)(d) to (f)“the specified details”—(a) in relation to a person who is an individual, means—(i) name, date of birth and nationality;(ii) usual residential address;(iii) a service address;(b) in relation to a person that is a legal entity, means— (i) name;(ii) principal office;(iii) a service address;(iv) the legal form of the entity and the law by which it is governed;(v) any public register in which it is entered and, if applicable, its registration number in that register.”(4) In sub-paragraph (2), for “sub-paragraph (1)(c)” substitute “sub-paragraphs (1)(c) and (1A)(a)”.”Member’s explanatory statement
This clause extends the information that must be provided in connection with the registration of overseas entities where a person is a beneficial owner by virtue of being a trustee.
Lord Johnson of Lainston (Con)
My Lords, I shall speak to government Amendments 76H, 77A, 77B, 77E, 77F, 77G, 77H, 77J, 77K and 77L, on the register of overseas entities provisions in Part 3 of the Bill—I am just checking that I read out the right amendments.
Lord Johnson of Lainston (Con)
I thank noble Lords; at this stage, I feel that we are operating as one team to make sure that we are creating good legislation, which is very important. I am grateful to all Members of the Committee for their helpful interventions and constructive collaboration as we come to the conclusion of the Companies House section of the Bill.
The register of overseas entities—“the register”—was created by the Economic Crime (Transparency and Enforcement) Act 2022, which I will refer to as “the 2022 Act”. This was expedited through Parliament as part of the government response to Russia’s invasion of Ukraine, as I am sure all noble Lords are aware. Overseas entities owning land in the UK must provide information about themselves and their beneficial owners to Companies House in order to retain their ability to freely transact with their land or property, which noble Lords have already discussed in some detail.
These requirements are retrospective. Overseas entities owning land in England and Wales from 1 January 1999, and in Scotland from 8 December 2014, must register with Companies House. A transitional period of six months was provided. The register went live on 1 August 2022 and the transitional period ended on 31 January 2023. At the time that the register opened, there were an estimated 32,000 overseas entities in scope, which noble Lords have discussed. Well over 27,000 entities are now registered. Given the emerging finding that a number of entities registered as proprietors may now be dissolved or struck off and the inherent challenge of contacting overseas entities, we think that this is a high compliance rate. Overseas entities seeking to acquire land or property since 5 September 2022 must provide an overseas entity ID number issued by Companies House or their application to any of the UK’s three land registries will be rejected.
I turn to the related amendments and shall speak first to government Amendments 76H, 77A, 77E, 77F, 77G, 77H, 77J and 77L, which require overseas entities that had to register on the register of overseas entities by 31 January 2023, in particular where there is a trust involved, to provide further information to the register of companies in order to counter avoidance. I believe that this amendment was raised earlier in Committee proceedings in relation to trust transparency, which, as I hope to explain, is not specifically accurate. However, noble Lords will be pleased with our efforts to ensure that we are always aware of ways in which companies can use loopholes to create avoidance and by how firm we are intending to be. As I have said, Amendment 76H is a very good amendment and I hope your Lordships share the Government’s view of that.
Overseas entities owning land in the UK are required to provide details about their beneficial owners to Companies House. Where a beneficial owner has this status because they are the trustee of a trust, the entity is required to also provide information about the trust. The kinds of arrangements that are used to hold property in the UK can be complex and difficult to penetrate, none more so than arrangements that include one or more trusts in the ownership chain.
The Government heard a lot of concern about trusts during the passage of the 2022 Act and have done so again during the passage of this Bill. The Government have listened, and this set of amendments is designed to address some of those concerns. The amendments are complex, as are the structures they seek to look through. They have been tabled to ensure that those entities that are associated with a trust cannot circumvent the requirements.
Where there have been changes to the beneficial owner of an overseas entity, to the beneficiaries of a trust, or to which trust owns the overseas entity between 28 February 2022, which is the date the Act was first published, and 31 January 2023, the end of the transitional period, these amendments require the entity to provide additional information. If changes have been made in a deliberate attempt to avoid transparency requirements, they will have been futile because under these amendments the overseas entity will be required to provide the information anyway.
Although information about trusts is not publicly available, it is a valuable and rich source of data for law enforcement agencies, including HMRC. These amendments will enhance the information held about trusts associated with overseas entities and prevent those seeking to disguise their involvement in property-owning arrangements from doing so. The amendments also make a number of consequential changes to the Act so that the new provisions can be properly inserted into the Act.
Amendment 77L provides a power for the Secretary of State to make regulations to exclude certain registrable beneficial owners from these anti-avoidance provisions. The purpose of providing this power is to ensure that the new provisions do not impose undue burdens on businesses. For example, many overseas entities holding UK land are in turn owned by large, legitimate pension funds which are trusts. It would be disproportionate to expect large pension funds to report every change in beneficiary for the relevant period, as I am sure we are all aware. The overseas entities in question will still be required to provide information about the pension fund trust and to update that information annually. The new requirements will strengthen the regime and demonstrate our intent to leave nowhere to hide.
Amendment 77A ensures that an overseas entity cannot remove itself from the live register without providing any scheduled annual update. This will help to prevent any attempt to circumvent the disclosure requirements by selling up and applying to remove the entity—I notice that the noble Lord, Lord Vaux, is nodding enthusiastically—from the register without providing the required information. This strengthens the updating requirements further and will increase the robustness of the register.
When an overseas entity is removed from the live register, the information relating to it will remain publicly visible, but there will no longer be a requirement to update it on an annual basis, as seems sensible. An entity can successfully apply for removal only if it has disposed of all its land and property assets in the United Kingdom. I hope that noble Lords will welcome and support these amendments.
Amendment 77K amends the power in Clause 166 of the Bill to provide a consent mechanism for devolved Administrations. We have included in Clause 166 a power to amend the Economic Crime (Transparency and Enforcement) Act 2022 in line with amendments made by Part 1 of the Bill to the Companies Act 2006, which relate to corresponding provisions in the 2022 Act. This power has been included to ensure that, as far as possible, we maintain consistency between the two Acts and in the way in which Companies House operates its registers.
When the 2022 Act was passed, it required legislative consent from the Scottish Parliament and the Northern Ireland Assembly because some of its provisions engaged areas of devolved competence. We have provided for Scottish Ministers or the Department of Finance in Northern Ireland to consent to any regulations made under this power that engage areas of devolved competence in Scotland and Northern Ireland respectively, as with the similar mechanisms in the amendments linked to winding-up of limited partnerships. This is a bespoke solution for this specific regulation-making power. I trust that noble Lords will support this amendment.
Lord Vaux of Harrowden (CB)
My Lords, I rise to speak to the three amendments in my name in this group, Amendments 77AA, 77C and 77D. I thank the noble Baroness, Lady Bowles, for her support for the latter two. This group addresses flaws in the original economic crime legislation, the Economic Crime (Transparency and Enforcement) Act, and makes improvements to it. That Act was rushed through as emergency business, so I welcome the Government making these improvements, and I hope that the noble Lord recognises that my amendments are trying to do the same thing.
The noble Lord has said several times now that his Amendment 76H is very good. I echo the words of the noble Lord, Lord Agnew, that it is very good but could be so much better if this information was made public by default—but we have already been there.
With these amendments, I acknowledge that I am revisiting discussions that we had during the passage of the Economic Crime (Transparency and Enforcement) Act, and I apologise to noble Lords who may feel a sense of déjà vu in that respect. Normally, I would not revisit things that we have already discussed, but I am relying on the very clear commitment from the noble Lord, Lord Callanan, who reassured us at the time that we would be able to use this Bill as an opportunity to revisit matters that would perhaps have been the subject of Divisions in less of an emergency situation than last time. I remind noble Lords that he specifically indicated a willingness to revisit the matter that my amendments in this group are trying to address. So, while it is unusual to come back to the same thing, that is why I feel justified in doing so.
Amendments 77C and 77D are aimed at removing an anomaly, or loophole, in the overseas entities register. Amendment 77AA, which is an amendment to the Minister’s Amendment 77A, follows on from the same issue. Currently, if the details on the overseas entities register are changed—for example, if there is a change in beneficial ownership—that needs to be updated on the register only annually. This means that a person could register an entity, filing all the necessary details, and could then change the ownership or other details the very next day, but they would not need to inform the registrar until the end of the year. In my view, that is an unacceptable length of time for a register to remain out of date and inaccurate. Properties could be bought and sold during that period, without anyone knowing who is really behind those transactions.
As a comparison, the PSC rules require an update within 14 days of the company becoming aware of a change. Amendment 77C aims to bring the overseas entities register into line with the PSC register and require an update within the same 14 days. This amendment is identical to one that I tried to put to the previous Bill.
This matters for two reasons. The whole point of the register is to ensure that we know who the beneficial owner of the property held by the overseas entity is. If the information can be up to a year out of date that means we do not know. More importantly, this could lead to the risk of an innocent party who buys a property from an overseas entity unwittingly enriching a criminal or sanctioned person. That cannot be desirable.
The argument against accepting this amendment that the noble Lord, Lord Callanan, made last time we debated it was that, if there was a 14-day updating duty, a person buying a property from an overseas entity could not know if the entity would be in breach of the updating requirement. Because of the way the Act works, that could mean that the innocent party might not be able to register ownership of the property that they acquired. That is obviously very serious and it is a valid concern, which is why I did not push the matter last time round.
However, the Act actually includes a solution, in that it is possible for an overseas entity to shorten the annual reporting period, so a purchaser of the property could make it a condition of the purchase that the entity shortens the period and files an update before the purchase goes ahead. That would solve the problem, but I acknowledge that that requires the purchaser to be well advised and puts the onus on the purchaser, which is not right.
This time round, I have tried to address that problem by tabling Amendment 77D, which would require that, before an overseas entity can enter into an agreement to buy or sell a UK property, it must update the register no more than 14 days before entering into such an agreement. That would both safeguard any innocent purchaser and, combined with Amendment 77C, ensure that the register is kept up to date in the same way as the PSC rules are. I hope that would solve the problem that the noble Lord, Lord Callanan, highlighted last time round so that we can bring the overseas entities register into line with the PSC register to ensure that it is kept up to date and is not up to 12 months out of date at any one time.
Amendment 77AA aims to close the same loophole when an overseas entity applies to be deregistered. I welcome the Minister’s Amendment 77A—he said that I was nodding enthusiastically and he was right—but although that amendment would require any outstanding updates to be made before an entity can be deregistered, the same loophole exists. If no update is pending, the information on the register could be a whole year out of date because there is no requirement to update the register for a year.
Amendment 77AA would simply add a requirement that an entity should make a statement that the information on the register is up to date and accurate before deregistration can be accepted. That seems an incredibly simple way of ensuring that the register is up to date before the deregistration can happen, which is important.
I hope the Minister will see these amendments as helpful and intended to improve the overseas entities register, to remove a loophole and to make it the same as the PSC rules. It is very hard to see why it should not be. I hope he feels able to accept them.
Lord Agnew of Oulton (Con)
I strongly support these very sensible proposals from the noble Lord, Lord Vaux, which really show why hereditary Peers still have such an important role in this House. It will be very interesting to hear from my noble friend the Minister why he might wish to dismiss these amendments, because they make such a lot of sense: if you are buying from one of these opaque entities, why should all the responsibility lie with the buyer, not the seller?
Lord Macpherson of Earl’s Court (CB)
My Lords, I will very briefly support the proposals. It makes sense to ensure that people who think that they are buying something legitimately are adequately informed. I like the series of amendments from the noble Lord, Lord Vaux, to solve the problem that was pointed out on a previous day.
The fact is that those of us involved with companies and so on regularly have to update the Companies House register very quickly indeed. Fortunately, because of modern technology, that is relatively easy to do. Similarly, we have to update our register of interests on a regular basis, so I see no reason why this should not apply in this important, specific case.
Lord Faulks (Non-Afl)
My Lords, the Joint Committee was certainly very concerned with the need to update when it provided its report in respect of the register of overseas entities. It particularly acknowledged that an event-driven update requirement was a much better way of securing the accuracy of the register. I entirely endorse what the noble Lord said.
Lord Fox (LD)
I thank the Minister for introducing his amendments. I broadly support them from these Benches. I note, not churlishly, that this again boosts what Companies House knows but not what it publishes. I make the point again that perhaps the default position should be the other way around.
I particularly welcome Amendment 77K. Consultation with the Scottish and Northern Ireland Governments is an important feature of what should happen.
My noble friend Lady Bowles of Berkhamsted co-signed two of the amendments and, were she here, I am sure that she would have something important to say in addition to what the noble Lord, Lord Vaux, said, but I do not. However, I have a memory of history which the Minister did not experience because he was not here at the time—namely, the process we went through to pass the precursor to this Bill.
The reason why many of us stayed our hands on this issue at the time was that the Government intended to put this through in two days: one day in the Commons and one day in the Lords. We went through all the processes in one day. The passing of amendments would have seriously jeopardised that process and none of us on opposition Benches, the Cross Benches or indeed the Government Benches wanted to do that. The Government made one or two changes to the Bill on their own account, but the promise was that, come this Bill, we would have the opportunity to revisit some of those issues.
To accommodate the point made by the noble Lord, Lord Vaux, the noble Lord, Lord Callanan, was pretty explicit about the opportunity we would have in this Bill to have the debate. That is why we are having this debate and why we all have some expectation that the Minister should be able to help us along these lines.
Lord Coaker (Lab)
My Lords, I will very briefly support the remarks made by the noble Lords, Lord Faulks and Lord Fox, and the amendments tabled by the noble Lord, Lord Vaux. I look forward to the Minister’s response.
I also broadly welcome the Minister’s amendments. I have just one question, on Amendment 77L, to which I am sure there is an easy answer. It says:
“In this Schedule ‘the relevant period’ means the period … beginning with 28 February 2022 … ending with 31 January 2023”.
How were those dates arrived at?
Lord Johnson of Lainston (Con)
I appreciate the input of all noble Lords in this Committee. That period comprises the implementation, when the Act came into force, and the compliance date. Effectively, the law announced that you had to be compliant by a certain date. There is a seven-month lead-in time and the Government are concerned that people used that time to avoid the date at which they have to declare. We are, in effect, backdating the transparency, which is very sensible. I hope the noble Lord supports that.
Lord Vaux of Harrowden (CB)
There are two elements to my amendments. One is that, if there is a change of beneficial ownership, it should be registered within 14 days, in the same way as the PSC works, because of the way that the Act works in relation to the ownership of property, the inability to dispose of property and, therefore, the risk to a potential buyer if they did not know that the company should have given an update. The second is based on the transaction. If there is to be a transaction, the information must be updated before then, which gets around the issue that the noble Lord, Lord Callanan, quite rightly raised last time. So there are two elements: one is the 14 days—we should keep the thing up to date at all times, regardless of whether there is a transaction—and the second is that we should update it if there is a transaction.
Lord Johnson of Lainston (Con)
I am grateful to the noble Lord for that further clarification. As I said, I am very aware of our desire to make sure that the register is clear and transparent, and to make sure that people, corporations, individuals and beneficiaries cannot move ownership and obfuscate the intention of transparency. What I will say is that there has to be a record of activity during the year. It is not a snapshot but a story in terms of beneficial ownership, so any beneficial ownership change has to be catalogued in that period of time.
Lord Vaux of Harrowden (CB)
That may be true, but Companies House is informed of it only at the end of the 12-month period. Therefore, the point remains that if you register a company on 1 January, change the beneficial ownership on 2 January and then do lots of transactions on 3 January, 4 January, 5 January or whatever, you can then tell Companies House that it has changed on 31 December. It could have changed multiple times in that period.
Lord Johnson of Lainston (Con)
I was coming on to make that point. I do not disagree with the philosophy of the noble Lord’s points; my point is that it is reasonable to look at this from every angle. I think that is right. We do not want to create hasty legislation, certainly not at the Dispatch Box, so I am very reluctant—as your Lordships can imagine—to support an amendment that would put me in that position. I am not unreluctant at all to try to intellectualise further how we make sure that there is a sufficient degree of transparency of overseas entities’ beneficial ownership, without putting at risk the necessary level of confidence that transactors have to have over the compliance of the transacting party. I mean no disrespect to the noble Lord by my phraseology, but it may sound like a good idea to bring these changes to bear, but I am advised that it is more complicated than it looks and it may not give us the security or transparency that we wish.
Lord Fox (LD)
I think we welcome the tone of the Minister’s comments to some extent. I wonder whether he expects to have completed the intellectual and practical investigation of this in time for Report, so as to bring forward amendments of the Government’s own making that address the issue he has signed up to intellectually. Or do the Government feel that there would be some other vehicle to deliver this?
Lord Johnson of Lainston (Con)
I thank the noble Lord, Lord Fox, for his question, which I am not able to answer as conclusively as he might wish. There may be alternative mechanisms to approach this if so desired, and if the Government believe it is the way forward and the House decides accordingly. I hope the Committee will forgive my language at the Dispatch Box and that they hear the tone of—
Lord Agnew of Oulton (Con)
I am sorry to interrupt my noble friend but, given that he is now embarking on an intellectual journey on this subject and that we are not sure when that journey may conclude, I want to add a couple of nuances. First, he is right to ask what the unintended consequences are of introducing a new step. I accept that that needs to be challenged but, to give a simple example, if you are buying a property and the conveyance has dragged on a while, I think the buyer is required to carry out further searches at the last minute to ensure that a new Tube line has not suddenly been announced under the building they are buying. There is a mechanism to do it.
The other area of interest to me goes back to the point I made earlier about the great things that have been achieved with the register of overseas entities, with its high level of compliance. None the less, Transparency International thinks that there may be up to 7,000 entities and that, although we might know their names, we do not know what they really are. The proposal of the noble Lord, Lord Vaux, would flush them out before the sale. I am sure that HMRC might be very interested in a lot of these organisations, so there would be a beneficial element which has not necessarily been thought about at the moment. I would like my noble friend to add to that to his contemplation.
Lord Faulks (Non-Afl)
To add further to the intellectual challenge, and in support of what the noble Lord, Lord Agnew, said, when you transfer land quite a lot of formalities have to be gone through, in terms of conveyancing and the like. We are just talking about another formality that needs to be complied with. I do not understand that to be particularly onerous and it is consistent with what is expected. An event-driven matter was what we raised in our report; I am not sure that it should come as a great surprise that we think this is a sensible idea.
Lord Johnson of Lainston (Con)
As I hope I have illustrated, my enthusiasm for intellectualisation is paramount, even after an enjoyable light afternoon of committee debate. If I may expand further on the difference with the legislation relating to overseas entities and other types of purchase, using my noble friend Lord Agnew’s concept about the bus route or discovering moments before one buys a house that they are going to build past it some terrible thing—I was going to say a high-speed rail line, but of course we are enthusiastic here about building high-speed rail lines in this country—that is not the same thing at all.
Here, we are talking about the concept of overseas entities and the whole principle around this is to ensure that non-compliant entities are unable to transact. That is the only way to make this process workable. It is not a question of caveat emptor or something that can be corrected later, or whatever. This will prevent a transaction from happening. If a noble Lord purchases something—we were hearing earlier about the noble Lord, Lord Wallace, going to Battersea Power Station to purchase himself a downsized retirement villa, which seemed to be an upgrading, certainly for the Johnson household—is it reasonable to have a situation in which you cannot be sure whether the party you are dealing with is compliant?
I can see the noble Lord, Lord Vaux, waiting to leap up from his seat to tell me how it is possible. If it is possible to find a solution to this principle, I would be happy to have a discussion, but I am extremely reluctant to make a decision at the Dispatch Box.
Lord Vaux of Harrowden (CB)
I do not think anyone disagrees with the Minister. I said as much when I introduced my amendments, as I am conscious that the way that the Bill works means that there is a risk to the purchaser. We need to make sure that does not happen, and I have attempted to deal with it with these amendments. If that does not work, I am open to discussions, but it would be helpful to hear the Minister confirm, as I think I understand it, that he is sympathetic to the concept of making sure that the register is updated on a timely basis. That is the core thrust of these two amendments—a way to get around that and solve the very problem that the Minister is talking about. Therefore, I am looking for confirmation that he is sympathetic to keeping the register updated, if it is possible to do that and if we can solve the property ownership problem and bring it into line with the PSC rules.
Lord Johnson of Lainston (Con)
As always, I am grateful to the noble Lord, Lord Vaux, for his comments. I just repeat the point that we have been involved in markets where there has been misregulation. If it is believed that you cannot, in effect, undertake a transaction with a registered overseas entity because it is not possible to confirm compliance, whether Companies House is able—
Lord Vaux of Harrowden (CB)
The Minister is just repeating what he said before. I am looking for something more. The thrust of these amendments is that the register should be updated more regularly than annually. It should be updated when the information changes. Is he sympathetic to that and will he accept something along those lines, as long as we can find a solution to the property ownership issue?
Lord Johnson of Lainston (Con)
I hope noble Lords will forgive me if I thought myself entitled to a small preamble to my answer. Simple yes or no answers at the Dispatch Box are rather blunt instruments for creating finely tuned legislation. Noble Lords would not respect that process if that was the case.
I hope I am not repeating but clarifying the point, for me and my officials as much as for the Committee. What is worrying the Government, and should worry us all in this Room, is the chilling effect of our regulation. We must make sure that we balance our intended ambitions with the need to ensure that business functions properly. That is what this is about. If it does not do that, it will counter the effect that noble Lords want. That is the concern.
I am coming to answer the noble Lord’s question, if he will indulge me for a few more minutes. The question of non-compliance, which is at the core of this legislation, is not the same as a caveat emptor, additional, post-purchase risk. It is totally different. If the concept of these amendments makes it difficult to be assured of the compliance of a registered overseas entity, it makes it very difficult to welcome them. If it is possible, I am open to having a discussion around ensuring a timely mechanism—I do not wish to commit to anything specific—for matters of key interest, which are more than recorded data but are relevant to the intentions that we will bring to bear in our Bill and can be managed appropriately. I am always open to discussions about how we can make that process more transparent, cleaner and easier to manage. With that very clear commitment, I ask the noble Lord to withdraw his amendment.
Lord Vaux of Harrowden (CB)
The Minister has not actually addressed Amendment 77AA, which is an amendment to his Amendment 77A. I apologise for amending his amendment again.
Lord Johnson of Lainston (Con)
If the noble Lord will allow me, I will turn to my notes on Amendment 77AA. I thank all noble Lords for their valued contributions during this debate, as I have done consistently. I know that the register of overseas entities remains an issue of keen interest to all of us—it is at the core of much of the well-placed description from the noble Lord, Lord Coaker, of public anger at what has happened over the past decades—not least the noble Lord, Lord Faulks, who I know was involved in the issues in the debate two years ago now, I believe, and others who led the pre-legislative scrutiny of the original draft legislation.
Lord Vaux of Harrowden (CB)
I am not sure that the Minister has done so because, as things stand, as I understand it, all his amendment requires is the information that is already required—that is, the annual statement. In other words, there are no statements that have not been made. Even if no pending statements are required, information can still be up to a year out of date. The whole point of this is to try to ensure that, at the point of deregistration, the information is fully up to date and has been completely updated before that happens. It is the same as when you sell a property. Even if there are no updates pending, that information could be up to a year out of date.
Lord Johnson of Lainston (Con)
I apologise to the noble Lord if I have got this wrong but, as I understand it, to be given approval to be removed from the register, an entity has to provide final information. If that is not correct, I will certainly return to the noble Lord. I am looking at my officials to see whether I have misinterpreted this but I am very grateful to noble Lords in assisting us in ensuring that we have drafted our legislation properly.
Lord Fox (LD)
Further clarification on that would be very helpful because I have lost track of where we are on that. However, I have another question for the Minister. He has on a number of occasions talked about the chilling effect. Could he enlighten us, perhaps in writing, as to how that is measured or assessed? If it is by anecdote, how many anecdotes are required to know that there is a chilling effect? If it is by objective determination, I would like to know what that objective determination is. If it is by consultation—the Minister has mentioned a number of times on a number of occasions that there has been detailed consultation but I have been unable to find any evidence of that—I think your Lordships would be pleased to be told where they can find the results of that consultation. All this would help us to understand a little bit how decisions are being made on what to put into and what not to put into the Bill.
Lord Johnson of Lainston (Con)
I am grateful to the noble Lord for that point. It inspires and helps us to come to good conclusions. We have consulted widely on a wide range of issues to ensure that we come to the right conclusions in this legislation. We also rely on the good counsel, great knowledge and intellectual capabilities of noble Lords in this Committee to help us draft, shape and form our legislation.
On the question of how we decided whether something may have a chilling effect, clearly that is a figure of speech—perhaps it has no place in such an intellectual crucible as this Room—but I reassure the noble Lord that if someone have a significant counterparty risk they will not be able to make a transaction. There are numerous organisations, companies, corporates and individuals that simply will not transact if they feel that there is no transaction security.
Lord Fox (LD)
I think I was minded to recognise that. What I was interested to receive was the input that the Minister is using to make that point—in other words, for the results of the consultations to which the Minister has referred to be shared more widely than simply the Minister’s circle and team. As far as I can tell, they have not been published. I am quite happy to keep them confidential if they need to be, but for us to empathise properly with the point that the Minister is making we need to be singing from the same hymn sheet.
Lord Johnson of Lainston (Con)
I appreciate that comment; I had not thought about that. We have not done a government impact assessment that could be published, such as the ones relating to the trade Bills that I have worked on, but if we can provide useful feedback on how we have come to some of our conclusions it would be helpful to do that. I would have thought that, in the lead-up to this, noble Lords would have made inquiries from some of the key sectors to gain good information from them, as we have.
I know for a fact that not every element, clause or amendment has been specifically consulted on because that would be impractical but, broadly speaking, we have received a great deal of information, as I understand it. My noble friend Lord Leigh’s amendment, on the publication of auditor changes, which we discussed earlier, came from our consultation with whatever august body of auditors it was that we discussed. As all noble Lords here know, I am comfortable being as open as possible. However, if I may, I will bring us to a conclusion because I would like to finish our last piece of business today, without a cost to democratic scrutiny.
I will attend to the comment from the noble Lord, Lord Vaux, about Amendment 77AA. I refute his point that this information can be a year old because that cannot be the case. The application for removal must contain information about the state of affairs at the date of the application. I do not mean to be pugnacious, but I believe that I am correct in saying that, in terms of removal from the register, the information that the noble Lord wishes to see—as we do—to prevent exactly the sorts of things that he is talking about will be there. I am very happy to double-confirm after the debate that, broadly speaking, I am right in my commitment. I would not like to give false promises, but the assumption—I have been reassured by officials during this debate—is that we are in line.
Lord Coaker (Lab)
May I just make one point about process? I think my noble friend Lord Ponsonby made this point earlier, and we have just heard it again. On quite a large number of occasions the Minister has said that he will write, provide reassurances, come back to Peers, and share letters, information, how various conclusions have been arrived at and what consultations there have been. I know that the Minister and his officials will do that but, to help move us to Report, I ask them to reflect on how to do all that in as short a period of time as possible to allow those of us who want to to consider what happened in Committee and the various conclusions. That is important so that we have a manageable Report and we deliver the sort of Bill that we want.
Lord Johnson of Lainston (Con)
I am grateful to the noble Lord for those points. As I have made clear, I hope noble Lords do not think that I am kicking the can down the road.
Lord Coaker (Lab)
I honestly do not think that the Minister is doing that; I was just trying to stress to him the importance of that process.
Lord Johnson of Lainston (Con)
Fair enough; I totally agree. Our officials are very much working on making sure that we have not missed anything. Please forgive us if we do, but I do not believe we will. My point about further discussion, as I say, is that I am convinced we are correct and there is no need for this amendment. I am convinced that we have the information that will be provided at the time of removal from the register—but I am always cautious to make sure that the exact specificity of my comments is backed up in facts. If that is not the case, I am very comfortable coming back to the Committee and being clear about it. With that in mind, I ask noble Lords not to press their amendments.
Lord Johnson of Lainston
“Applications for removal
(1) Section 10 of the Economic Crime (Transparency and Enforcement) Act 2022 (processing of application for removal) is amended as follows.(2) In subsection (2), after “land” insert “and there are no updates pending”.(3) In subsection (3), after “land” insert “or there is an update pending”.(4) After subsection (3) insert—“(3A) For the purposes of subsections (2) and (3) an update is pending if—(a) an update period for the entity has ended and the entity has not yet complied with the duty under section 7 in respect of that period, or(b) the entity is required to deliver information under Schedule 6 but has not yet done so.””Member’s explanatory statement
This requires the registrar to refuse an application for the deregistration of an overseas entity if it has not yet filed an update or certain other information that is due.
Lord Johnson of Lainston
“Verification of registrable beneficial owners and managing officers
(1) Section 16 of the Economic Crime (Transparency and Enforcement) Act 2022 (verification of registrable beneficial owners and managing officers) is amended as follows.(2) In subsection (2)—(a) after paragraph (a) insert— “(aa) about how the information is to be verified (including provision about the kinds or sources of evidence to be used);(ab) about the standard to which verification is to be carried out;”;(b) after paragraph (b) insert—“(ba) about the records that must be kept in connection with verification;”;(c) after paragraph (d)(inserted by section 156 of this Act) insert—“(e) about the information that must be provided to the registrar to enable the registrar to monitor compliance with any requirements imposed by the regulations.”(3) After subsection (2) insert—“(2A) Regulations under this section may create offences in relation to failures to comply with requirements imposed by virtue of subsection (2)(ba) or (e).(2B) The regulations must provide for any such offence to be punishable—(a) on summary conviction in England and Wales, by a fine;(b) on summary conviction in Scotland, by a fine not exceeding level 5 on the standard scale;(c) on summary conviction in Northern Ireland, by a fine not exceeding level 5 on the standard scale.””Member’s explanatory statement
This amendment makes it clear that regulations about verification can make provision about how it is carried out and the standard to which it is carried out. It also allows requirements imposed about the retention of records etc to be enforced by the creation of a summary-only offence.
Lord Johnson of Lainston
Member’s explanatory statement
This is consequential on Schedule (Overseas entities: further information for transitional cases), which is inserted before Schedule 6.
Member’s explanatory statement
This is consequential on Schedule (Overseas entities: further information for transitional cases), which is inserted before Schedule 6.
Member’s explanatory statement
This is consequential on Schedule (Overseas entities: further information for transitional cases), which is inserted before Schedule 6 to the Bill.
(b) any information required by paragraph 4(2)(c) of Schedule 6 (information about beneficiaries).” Member’s explanatory statement
This is consequential on Schedule (Overseas entities: further information for transitional cases), which is inserted before Schedule 6 to the Bill.
Lord Johnson of Lainston
“Overseas entities: further information for transitional cases
Schedule (Overseas entities: further information for transitional cases) (overseas entities: further information for transitional cases) amends the Economic Crime (Transparency and Enforcement) Act 2022 to impose further duties on overseas entities to deliver information to the registrar.”Member’s explanatory statement
This introduces Schedule (Overseas entities: further information for transitional cases).
Lord Johnson of Lainston
“(2) The Secretary of State must obtain the consent of the Scottish Ministers before making regulations under this section that contain provision that would be within the legislative competence of the Scottish Parliament if contained in an Act of that Parliament.(3) The Secretary of State must obtain the consent of the Department of Finance in Northern Ireland before making regulations under this section that contain provision that—(a) would be within the legislative competence of the Northern Ireland Assembly if contained in an Act of that Assembly, and(b) would not, if contained in a Bill in the Northern Ireland Assembly, result in the Bill requiring the consent of the Secretary of State under section 8 of the Northern Ireland Act 1998.”Member’s explanatory statement
This amendment requires the Secretary of State to obtain consent before making regulations under clause 166 that contain provision within the legislative competence of the Scottish Parliament or the Northern Ireland Assembly.
Lord Johnson of Lainston
“SCHEDULE 5A OVERSEAS ENTITIES: FURTHER INFORMATION FOR TRANSITIONAL CASES1_ The Economic Crime (Transparency and Enforcement) Act 2022 is amended as follows.2_ In section 16 (verification of registrable beneficial owners and managing officers), in subsection (1), after paragraph (c) insert—“(d) complies with the duty under Schedule 6 (duty to deliver further information about transitional period).”3_ After section 43 insert—“43A Duty to deliver further information for transitional casesSchedule 6 (duty to deliver further information for transitional cases) imposes further duties on overseas entities to deliver information.”4_ After Schedule 5 insert—“SCHEDULE 6 DUTY TO DELIVER FURTHER INFORMATION FOR TRANSITIONAL CASESApplication of this Schedule1_(1) This Schedule applies in relation to an overseas entity if—(a) the entity—(i) is registered as an overseas entity when this Schedule comes into force or has been so registered at any earlier time, and(ii) was registered as the proprietor of a relevant interest in land in England and Wales or Scotland at any time during the relevant period, or(b) the entity has committed an offence under paragraph 5 of Schedule 3 or paragraph 10 of Schedule 4 (duty to register as overseas entity in certain transitional cases).(2) For the purposes of sub-paragraph (1)—(a) an overseas entity is registered as the proprietor of a relevant interest in land in England and Wales if the entity is registered in the register of title kept under the Land Registration Act 2002 as the proprietor of a qualifying estate within the meaning of Schedule 4A to that Act;(b) an overseas entity is registered as the proprietor of a relevant interest in land in Scotland if the entity—(i) is entered, on or after 8 December 2014, as proprietor in the proprietorship section of the title sheet for a plot of land that is registered in the Land Register of Scotland,(ii) in relation to a lease that was recorded in the General Register of Sasines or registered in the Land Register of Scotland before that date is, by virtue of an assignation of the lease registered in the Land Register of Scotland on or after that date, the tenant under the lease, or(iii) is the tenant under a lease that was registered in the Land Register of Scotland on or after that date.(3) Expressions used in sub-paragraph (2)(b) are to be construed in accordance with section 9(11) and (12).(4) In this Schedule “the relevant period” means the period—(a) beginning with 28 February 2022; (b) ending with 31 January 2023.Duty to deliver statements and information2_(1) The overseas entity must deliver to the registrar—(a) any statements or information required by—paragraph 3 (changes in beneficial ownership of overseas entity),paragraph 4 (information about trusts and changes in beneficiaries under trusts),paragraph 5 (information about changes in trusts in which beneficial owners trustees),(b) a statement that the entity has complied with paragraph 8 of this Schedule (duty to take steps to obtain information), anything required by regulations under section 16 (verification of information) to be delivered to the registrar, and(d) the name and contact details of an individual who may be contacted about the statements and information.(2) If an overseas entity is registered as an overseas entity when this Schedule comes into force it must deliver the statements and information required by this Schedule—(a) at the same time as it delivers the statements and information required by section 7 on the first occasion after the end of the period of 3 months beginning with the day on which this Schedule comes into force, or(b) if it applies under section 9 for removal before then, at the same time as it delivers the statements and information required by that section.(3) If an overseas entity is not registered as an overseas entity when this Schedule comes into force it must deliver the statements and information required by this Schedule within the period of 3 months beginning when it comes into force.Information about changes in beneficial ownership3_(1) The overseas entity must deliver to the registrar the statement in row 1 of the following table or the statement and information listed in row 2.
Statement | Information | |
1 | A statement that the entity has no reasonable cause to believe that anyone became or ceased to be a registrable beneficial owner during the relevant period. | |
2 | A statement that the entity has reasonable cause to believe that at least one person became or ceased to be a registrable beneficial owner during the relevant period. | 1. The required information about each person who became or ceased to be a registrable beneficial owner during the relevant period, or so much of that information as the entity has been able to obtain. 2. The date on which each of them became or ceased to be a registrable beneficial owner if the entity has been able to obtain that information. |
Statement | Information | |
1 | A statement that the entity has no reasonable cause to believe that anyone became or ceased to be a beneficiary under the trust during the relevant period. | |
2 | A statement that the entity has reasonable cause to believe that at least one person became or ceased to be a beneficiary under the trust during the relevant period. | 1. The information specified in paragraph 8(1)(d) of Schedule 1 about each person who became or ceased to be a beneficiary under the trust during the relevant period, or so much of that information as the entity has been able to obtain. 2. The date on which each of them became or ceased to be a beneficiary under the trust, if the entity has been able to obtain that information. |
This requires overseas entities to deliver to the registrar further information about events occurring during the period beginning on 28 February 2022 and ending with 31 January 2023.
House of Lords
Leave of Absence: The Lord Speaker
The Lord Speaker (Lord McFall of Alcluith)
My Lords, I wish to inform the House that on Monday 24 and Tuesday 25 April, I will be attending the Conference of Speakers of European Union Parliaments in Prague, at which the UK has observer status. I therefore seek the leave of the House to be absent until Wednesday 26 April.
Schools: Financial Literacy
(1 year, 8 months ago)
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The Lord Bishop of St Albans
To ask His Majesty’s Government what steps they are taking to promote financial literacy in schools.
The Parliamentary Under-Secretary of State, Department for Education (Baroness Barran) (Con)
My Lords, we work closely with the Money and Pensions Service and the Treasury to support the effective teaching of financial education in schools. The Money and Pensions Service has published financial education guidance for primary and secondary schools and we will deliver webinars for schools in due course. Our national network of 40 maths hubs also supports schools to improve their mathematics teaching, including financial content in the mathematics curriculum, based on best practice from east Asia.
The Lord Bishop of St Albans
I thank the Minister for her reply and I am glad to hear what His Majesty’s Government are doing. I do not know whether the Minister is aware, but the Church of England has been working on a project called Lifesavers, which came out of one of the Archbishops’ Commissions. It has so far delivered financial literacy training for 30,000 school pupils and trained 2,000 teaching staff. Given that only 5% of parents believe that their children are leaving school with adequate financial literacy, what assessment have His Majesty’s Government made of Lifesavers and other similar school projects, such as GoHenry, and how can they help these projects as we are seeking to roll them out and increase financial literacy?
Baroness Barran (Con)
The Government are very grateful to organisations such as Lifesavers for the important work they do providing very useful support to teachers and schools. According to the Money and Pensions Service, about 6.3 million children between the ages of five and 17 received some form of financial education across just over 100 programmes, so there is a great variety on offer across the country.
Baroness Lampard (Con)
My Lords, I draw attention to my registered interest as chair of GambleAware. Research shows that 96% of 11 to 24 year-olds are exposed to gambling marketing and advertising, and that exposure to gambling marketing can influence their attitudes towards gambling and the likelihood of them gambling in the future. In the light of that, what specific measures are the Government taking to ensure that schoolchildren are educated about the financial as well as other risks associated with gambling?
Baroness Barran (Con)
My noble friend makes a very important point. Risks relating to gambling are part of the RSHE curriculum and there are two main aspects of this. One is supporting pupils to manage risk and make informed decisions in relation to their mental well-being and their behaviour online. The second area relates to internet safety and harms and addresses exactly my noble friend’s point: pupils are taught about the risks relating to online gambling, including how advertising and information is targeted at them, the risks of accumulating debt and how to be a discerning consumer of information online.
Lord Davies of Brixton (Lab)
My Lords, I am glad that the Minister stressed the importance of mathematics in this context. Will she take the opportunity to inform the Prime Minister that it is facile to suggest improving maths in our schoolchildren without paying mathematics teachers enough money to encourage them to join and stay in the teaching workforce?
Baroness Barran (Con)
I have to say that I do not really have any intention of saying to the Prime Minister that his plans are facile. More importantly, I point the noble Lord to the pickup in recruitment of maths teachers following our interventions over the last three years.
Lord Storey (LD)
My Lords, those children and young people who are financially literate are less likely to make poor financial decisions. Unfortunately, we see many children, particularly those from poorer backgrounds, who are not able to make those correct financial decisions. It is not just about teaching maths; it is actually about having practical opportunities and experiences. Will the Minister reflect on how we might do that in a more coherent way across all schools, particularly starting in primary schools?
Baroness Barran (Con)
The Government agree with the noble Lord that it is that combination of the fundamental knowledge in relation to mathematics and reading that support financial literacy and that can be taught in schools, having really high quality materials for schools to use. But, beyond that, they should have the experiences that the noble Lord refers to. That is why we are grateful to organisations such as Young Enterprise and the Money and Pensions Service for the work they do outside schools to complement what goes on inside.
Lord Vaux of Harrowden (CB)
My Lords, the Fraud Act 2006 and Digital Fraud Committee heard a lot of evidence that young people are particularly susceptible to fraud and also to being conned into becoming money laundering mules. Can the Minister assure us that the financial education will include fraud to enable young people to protect themselves from becoming either victims or unwitting criminals?
Baroness Barran (Con)
Certainly, the aspects of the curriculum that relate to how to operate safely online include fraud, which is a growing and terrible problem, as the noble Lord points out.
Baroness Thornton (Lab)
My Lords, the United Kingdom strategy for financial well-being sets a national goal to ensure that 2 million more children and young people across the UK receive meaningful financial education by 2030. I have not found any evidence yet that the Government have dropped this goal, although I have yet to find any evidence that the Government are on track to deliver it. But I would like the Minister to wonder how that goal can be achieved, given that research from the APPG on Financial Education for Young People suggests that two in five teachers are completely unaware of the legal requirement to teach financial education.
Baroness Barran (Con)
I understand the direction of the noble Baroness’s question. I would say that the data from the APPG report, which is extremely valuable, is none the less from a very small sample. It was from, I think, 401 teachers across the four nations. So, I think we have to be careful about extrapolating from that. The Money and Pension Service, which is responsible for delivering the additional 2 million children receiving good financial education has a wide range of programmes, including support for teacher training, communication and support for parents as well.
Lord Holmes of Richmond (Con)
My Lords, I declare my financial services interests as set out in the register. Would the Minister agree that, alongside financial literacy, we should also revolutionise the curriculum with data literacy, digital literacy and data privacy literary, to have a curriculum fit for the future and fit for now? Further, would she join with me in congratulating the right reverend Prelate the Bishop of St Albans? With the financial literacy initiative from the Church of England, it is clear that the bishop and his colleagues are rightly engaged in both LifeSavers and afterlife savers.
Baroness Barran (Con)
I am happy to congratulate the right reverend Prelate on his and his colleagues’ contribution before, during and after life. In relation to my noble friend’s question, data and digital literacy already feature within compulsory national curriculum subjects. Data literacy is covered within mathematics, science, computing and geography and digital literacy within computing and RSHE. They also feature within the subject content of GCSEs, which are counted in the English baccalaureate.
Lord Brooke of Alverthorpe (Lab)
The noble Baroness will be aware that children are particularly susceptible to advertising, especially online advertising. Could she say when the Government are going to do something about gambling advertising and the effects it has on children?
Baroness Barran (Con)
I think I already, in response to my noble friend’s question, addressed, in part, the noble Lord’s question, namely in that we already teach children about the risks relating to advertising, and in particular the advertising of online gambling.
Lord Weir of Ballyholme (DUP)
My Lords, the Minister has rightly identified that there are a variety of good programmes out there, such as LifeSavers. But in my experience in this field and other fields, sometimes within schools there is not always the greatest awareness of what is there. In light of one of the earlier questions which talked about coherence in the system, what actions are the Government taking to ensure that schools are made aware of best practice in this field to ensure they get the best possible provision for their young people?
Baroness Barran (Con)
We are doing quite a lot to support schools in teaching financial literacy. So, as I mentioned, we will be delivering webinars for schools in the next academic year, which will help teachers deliver the most practical and engaging content. The Money and Pension Service has already published financial education guidance for schools, and there is a quality mark accreditation scheme. Also, the Oak National Academy will be producing curriculum packages in this area.
UN: Individuals Displaced by Conflict
(1 year, 8 months ago)
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Lord Singh of Wimbledon
To ask His Majesty’s Government what discussions they have had at the United Nations about the case for introducing an obligation on countries intervening in conflicts to accept a moral and legal responsibility for the safety and wellbeing of individuals displaced by such conflicts.
The Minister of State, Foreign, Commonwealth and Development Office (Lord Goldsmith of Richmond Park) (Con)
My Lords, a range of obligations exist in international humanitarian law and international refugee law concerning the safety and well-being of civilians displaced by conflict. The UK consistently uses its diplomatic influence to uphold these protective laws and hold those who violate them to account. We work tirelessly with the UN High Commissioner for Refugees and other relevant agencies to ensure protection and humanitarian assistance are provided to individuals displaced by conflict.
Lord Singh of Wimbledon (CB)
My Lords, I thank the Minister for his Answer, but it does not go as far as I would like. It is important that any country contemplating military action in today’s world accepts full responsibility for its action. Twenty years ago, we invaded Iraq and toppled Saddam Hussein on the pretext that he was accumulating weapons of mass destruction. His removal resulted in brutal civil war between Shia and Sunni and a mass exodus of terrified refugees, genocide against the Yazidis and the emergence of ISIS and the Islamic State, leading to further mass killings and a still continuing flight of traumatised refugees to a hostile world. Then there was the debacle of Afghanistan. My request to the Minister is that the UK take a moral lead in working through the UN to make it mandatory for any country that embarks on conflict, causing an exodus of refugees, to accept full responsibility for their care and well-being, not only for humanitarian reasons but also to deter other countries from strutting their importance through the use of force in a smaller, interdependent world.
Lord Goldsmith of Richmond Park (Con)
I thank the noble Lord for raising this issue and for the points that he has made, but we believe there is already a robust and comprehensive ecosystem of laws and norms to protect civilians displaced by conflict. However, he is right that the UK should use our position of leadership to highlight this issue politically and raise it on the global stage—and we do so. We regularly engage in UN discussions, including at UNGA and the UN Security Council, and underline the responsibility of all states engaged in armed conflict to respect international humanitarian law and international refugee law and act in accordance with our obligations under them. The UK has been one of the most consistent and loudest voices on the subject for some time.
Baroness Chakrabarti (Lab)
My Lords, I am grateful to the Minister for—I think—being clear that His Majesty’s Government still support the refugee convention, as I think he suggested that they are promoting it on the world stage. Will he commit to promoting it with his Home Office colleagues as well?
Lord Goldsmith of Richmond Park (Con)
My Lords, the UN High Commissioner for Refugees is a key partner for the UK. It provides protection and humanitarian assistance to refugees and other displaced persons. We have provided the UNHCR with more than £70 million in 2022-23, including £25 million for the Ukraine response.
Lord Bellingham (Con)
My Lords, does the Minister agree with me that the most evil and brutal invasion or intervention in recent years is Putin’s invasion of Ukraine? Does he agree that there is now a major moral responsibility on Russia to make sure that grain exports are facilitated?
Lord Goldsmith of Richmond Park (Con)
The noble Lord makes a key point. We have repeatedly called on Russia through the United Nations to cease targeting civilians and civilian infrastructure and allow unfettered humanitarian access to civilians impacted by this illegal invasion. The lack of compliance with international humanitarian law contributes to displacement in Ukraine. As the noble Lord suggests, pressure must be mounted on Russia to take responsibility.
Lord Purvis of Tweed (LD)
My Lords, I declare a voluntary interest as the UK chair of the peacebuilding charity Search for Common Ground. The UK is and continues to be a world leader in the “do no harm” principle, but the Independent Commission for Aid Impact highlighted a concern in its December report that:
“The UK government’s poor donor practice weakened results and increased the risk of doing harm”.
Has the FCDO had an opportunity to reflect on the ICAI report, and how will it ensure that we improve our delivery of peacebuilding services to ensure that we do not undermine the “do no harm” principle?
Lord Goldsmith of Richmond Park (Con)
My Lords, the FCDO is a permanently evolving organisation. We always try to refine and improve the manner in which we make substantial annual investments. Despite the cuts to spending, which the noble Lord rightly raises on a regular basis, we remain a major partner to the UN and other multilateral organisations, while spending more bilaterally to allow us to focus on the UK’s highest priorities. We are providing £108 million in core funding to UN humanitarian agencies this year, which makes us one of the top contributors of unearmarked support. That includes £33 million to the UNHCR and £6 million to the International Organization for Migration, and we will provide a far higher figure through country-specific programmes.
Lord Collins of Highbury (Lab)
My Lords, the noble Lord mentioned the work of the United Nations General Assembly. In 2018, it affirmed the global compact on refugees, a framework for responsibility-sharing and international co-operation. Given that 83% of people who have been forcibly displaced are hosted in low and middle-income countries, can the Minister tell us how the Government will build on that compact at the Global Refugee Forum later this year?
Lord Goldsmith of Richmond Park (Con)
I draw the noble Lord’s attention to the Integrated Review Refresh and the international development strategy, both of which were published recently, in which we reiterated our commitment to championing international humanitarian law. We are focused on protecting those most at risk, including from gender-based violence, and on barriers to accessing humanitarian assistance. We work closely with the UN humanitarian agencies, the UN General Assembly and the UN Security Council to promote compliance with international law, and will continue to do so.
Lord Forsyth of Drumlean (Con)
My Lords, given the atrocities being committed in Ukraine, can it be right that the presidency of the Security Council is held by the Russians?
Lord Goldsmith of Richmond Park (Con)
The noble Lord makes an important and valid point.
Lord Griffiths of Burry Port (Lab)
My Lords, I hope that I may make a valid point too, on the noble Lord’s assertion a moment ago on the amounts of money given by the Government to the UNHCR. I am off to Strasbourg on Sunday and will be debating the United Kingdom’s current immigration policy in its migration committee and in plenary. Granted the levels of support that have just been mentioned, I am interested to know why the UNHCR repeatedly, at length, in detail and according to law has set itself so fiercely against present proposals in the immigration Bill.
Lord Goldsmith of Richmond Park (Con)
My Lords, there can be no doubt that there is an urgent humanitarian need to stop the small boat crossings. The UK Government have introduced legislation to prevent further loss of life by disrupting the business model of people-smuggling networks. Clearly, a system that enriches those smugglers and people traffickers is one that needs improvement. That is what we are trying to do. New approaches to these kinds of issues will raise new questions for the interpretation of international law. The UK will work openly and constructively to ensure that its new approach is fully compliant with international human rights, refugee and human trafficking protections. The legislation is about ending dangerous and unnecessary routes to the UK; it is not about denying protections to those in immediate, genuine need. We will continue to work with the UNHCR, not least through the financial contribution that I mentioned earlier, to ensure that those most in need can find sanctuary in the UK.
Baroness Smith of Newnham (LD)
Do the Government believe that sufficient has been done to support those who were displaced in Afghanistan when we left so ignominiously in August 2021?
Lord Goldsmith of Richmond Park (Con)
My Lords, the manner in which the situation in Afghanistan was allowed to change caused appalling humanitarian problems on a scope and scale that has rightly taken the attention of this House on many occasions. I make the broader point that, as we restrict illegal migration through the legislative pathway that I was just describing, we will do more to help people at risk of war and persecution by setting up safe and legal routes, as we have done in the cases of Syria, Afghanistan, Hong Kong and Ukraine. Since 2015, the UK has offered places and safety to nearly 480,000 people. The Government will commit to resettle a specific number of the most vulnerable refugees from around the world every year, working with local councils to understand their capacity for accommodation and support first and providing for the annual number to be agreed by both Houses.
Yemen and South Sudan: Humanitarian Crises
(1 year, 8 months ago)
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Baroness Anelay of St Johns
To ask His Majesty’s Government what assessment they have made of the progress towards resolving the humanitarian crises in Yemen and South Sudan; and what assistance they have provided, along with international partners, to ensure that children and families in those countries have adequate access to food, water, and medical supplies.
The Minister of State, Foreign, Commonwealth and Development Office (Lord Ahmad of Wimbledon) (Con)
My Lords, I begin by referencing the devastating events in Sanaa last night. I offer the sincere condolences of the whole House to the families of those who lost their lives. The sadness of the loss of life is heightened by being so close to Eid ul Fitr. Reportedly, more than 80 lives were lost and many more were injured during a stampede at a charity event designed to provide cash and food to those most in need at Eid ul Fitr. Inna Lillahi wa inna ilayhi raji’un—to God we belong, to God we will return.
Resolving the dire humanitarian crisis in Yemen and South Sudan requires peace. The South Sudanese Government should implement their peace agreement and road map, end the violence and provide more of their own resources to alleviate the humanitarian crisis. Similarly, the de facto truce in Yemen continues to hold. Long-term stability will come only with a Yemeni-led political settlement under the auspices of the UN, but the UK will continue to support millions of vulnerable people in both Yemen and South Sudan.
Baroness Anelay of St Johns (Con)
My Lords, I join my noble friend in expressing distress at the events in Sanaa. I am grateful to him for his words. The humanitarian aid allocated by the international community to Sudan and Yemen has been essential. It is also essential to ensure that it reaches those in need there. My noble friend will be aware that, over the last six months or so, there has been a dramatic surge in the level of attacks on humanitarian aid workers and in the theft of their aid. Can he tell the House what work Ministers have been doing with our colleagues in the international community, particularly the African Union, IGAD and the troika, to ensure that the combatants eventually give way to humanitarian workers instead of, as at the moment, killing them?
Lord Ahmad of Wimbledon (Con)
My noble friend speaks with great insight and experience, and I am grateful for her work in this area. I totally agree with my noble friend about the importance of humanitarian corridors. Only yesterday, during the repeat of the Statement on Sudan, we discussed the appalling and abhorrent situation where not only aid workers but also UN aid agencies and senior diplomats are being attacked in Sudan. That has a natural impact on South Sudan, in terms of humanitarian assistance, because of the routes through, and the situation remains extremely dire.
There has been some more positive development in Yemen, with this truce led by the Kingdom of Saudi Arabia. We have engaged with all relevant governments in the near neighbourhood, as well as the key UN agencies and all international organisations. We remain very committed to continuing our support for humanitarian assistance but also to opening up key corridors to allow aid to reach the most vulnerable.
Baroness Ritchie of Downpatrick (Lab)
My Lords, considering the level of the humanitarian crisis in both Yemen and Sudan, will the UK Government now consider reinstating the overseas aid budget, which was reduced some two years ago to 0.5% of GNI, and returning it to the original amount of 0.7%?
Lord Ahmad of Wimbledon (Con)
My Lords, I have often said from the Dispatch Box that we seek to return to the 0.7%, but notwithstanding the reduction in 2022-23, the UK Government have continued to provide emergency food aid for an estimated close to 200,000 people, including daily water and sanitation provision in South Sudan. We have continued our support and at the UN-led humanitarian pledging conference in March 2023 retained £88 million of aid to Yemen. We remain amongst some of the primary donors when it comes to bilateral support. The difficulty on the ground, as highlighted by my noble friend Lady Anelay, has impeded vital aid reaching the most vulnerable.
Lord Kamall (Con)
My Lords, it is important that we look at how we can intervene in many ways, and the Minister has mentioned the role of international organisations. Given that South Sudan has expressed an interest in joining the Commonwealth, has my noble friend spoken to his Commonwealth counterparts about perhaps providing assistance via the Commonwealth?
Lord Ahmad of Wimbledon (Con)
My Lords, I know of my noble friend’s interest in the Commonwealth, which is an organisation that I know well. During the PSVI conference back in November, there was some hope about the situation in South Sudan. My right honourable friend the Foreign Secretary and I met with the then Defence Minister on various issues concerning how we could strengthen South Sudan, including its place in the international community. However, things have since taken a rather regressive path—indeed, the Defence Minister herself is no longer in place. First and foremost, we need unity among the different parties in South Sudan, and then I am sure we can move forward on other considerations as well.
Lord Purvis of Tweed (LD)
My Lords, as the Minister alluded to, humanitarian aid and co-ordination for South Sudan and Juba is through Khartoum and Khartoum Airport. I repeat my interest that I was in Khartoum over the Easter Recess, and in my March visit I met separately with Generals Burhan and Hemedti. Last night I had an opportunity to speak to the deputy head of the doctors’ union from Khartoum, who relayed to me the sheer horror of the medical crisis in Khartoum at the moment, and the problem of getting supplies into Khartoum Airport. He asked me to make a direct appeal, at Heads of Government level, to seek a monitorable cessation of hostilities in Khartoum to secure the airport open, which would allow medical assistance in and let co-ordinators for South Sudan and Juba to continue their much-needed work.
Lord Ahmad of Wimbledon (Con)
I assure the noble Lord we are very seized of this. The discussions around the situation in Sudan took place at the G7 Foreign Ministers meeting. My right honourable friend the Foreign Secretary has engaged with key partners, including the troika who have key responsibility in Sudan. We are also engaging directly at senior level, as my right honourable friend has with Foreign Ministers in the near regions, particularly countries such as the UAE, the Kingdom of Saudi Arabia and Egypt, which have obvious influence on the ground in South Sudan.
Lord Collins of Highbury (Lab)
My Lords, the noble Lord mentioned the promising discussions and the exchange of prisoners leading to a permanent ceasefire, and the lifting of the Saudi-led blockade of Yemen, but that pathway towards peace remains incredibly shaky. The noble Lord stressed the importance of a Yemeni-led political solution. As we have a special responsibility as a Security Council penholder, can the Minister tell us what we are doing to support Special Envoy Grundberg’s mediation efforts? And can he update us on our work at the Security Council to ensure that the political process delivers the peace the people of Yemen deserve?
Lord Ahmad of Wimbledon (Con)
My Lords, I agree with the noble Lord that we all welcome what is a truce of some kind, but it is holding—that is the important thing. When I visited the Kingdom of Saudi Arabia recently, I saw quite directly the important role being played by Saudi Arabia, particularly by their ambassador Mohammed Al-Jaber who talked me through some of the reconstruction in the government-held areas. We have seen some progress through certain talks that took place directly, both with the UAE, the Kingdom of Saudi Arabia and Yemen, which have brought progress. I have engaged directly with the Foreign Minister of Yemen, as has my right honourable friend, and we are meeting with key personnel from the United Nations to ensure that the current truce can build into something much more substantial that will stand the test of the current challenges we face. It is tragic that, as I said, where aid does get through, such events can occur very quickly—we are still getting the full details, but it appears to have been an accidental firing that then caused havoc, which shows the sense of insecurity that people, including the most vulnerable people, in Yemen feel currently.
Prepayment Meters: Code of Practice
(1 year, 8 months ago)
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Baroness Brinton
To ask His Majesty’s Government how they will ensure that the new Ofgem Code of Practice regarding installing pre-payment meters for vulnerable and disabled customers will be enforced.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, the code of practice is a step in the right direction, with better protections for vulnerable households, increased scrutiny of supplier practices, and redress measures when prepayment meters were wrongly installed. Ofgem has now confirmed that it will put strengthened rules into energy company licences so that they can be enforced. The Government will monitor very closely the behaviour of suppliers and regulators and will not hesitate to intervene again if necessary.
Baroness Brinton (LD) [V]
My Lords, after the appalling behaviour of energy suppliers forcibly installing prepayment meters at the homes of the most vulnerable and disabled, why is Ofgem’s new voluntary scheme not compulsory? Worse, the categories “High Risk—Do not install” and “Medium Risk—Further assessment required” are confused and rely on energy supplier staff to make medical judgments. Someone awaiting a transplant is high risk but, post transplant, when they are medically still very vulnerable, they may not be. As Scope pointed out, does a customer with dementia even have the capacity to respond to chasing calls and emails? Does the Minister think that staff from energy suppliers should be making these medical decisions, and how will safe practice be enforced?
Baroness Bloomfield of Hinton Waldrist (Con)
The noble Baroness asked a number of questions. First, Ofgem does not have the right to impose rules without consultation. It is an independent regulator accountable to Parliament, but this voluntary code is agreed by all suppliers; it will be put into their contracts by October. There were some nuances and details perhaps lost in the Ofgem announcement on Tuesday about the code of practice. The medium-risk group is always protected by the precautionary principle so, if there is any doubt that the consumer is financially vulnerable or likely to disconnect, they must not install a prepayment meter. The vulnerable group includes any family with children under five, the elderly over 65, those with many other serious medical conditions including Alzheimer’s and Parkinson’s, and those in temporary situations such as pregnancy and bereavement. Ofgem has worked very hard to try to include everybody in the prevention of installation of prepayment meters and will continue to do so. They have all been paused for the moment.
Baroness McIntosh of Pickering (Con)
My Lords, I refer to my interest as honorary president of National Energy Action. Could my noble friend address two vital issues that the code of conduct does not cover? First, prepayment customers pay more per unit than any other customer, regrettably, and that has so far not been addressed by the Government. Will she urgently address it? Secondly, the standing charge is increasing, often every six months, by up to 20% a time. That is a charge over which customers have no control whatever at a time when there is a cost of living crisis.
Baroness Bloomfield of Hinton Waldrist (Con)
My noble friend is not quite correct, in that we are doing a lot to tackle the higher costs that PPM users pay, and the Government are taking action to end the prepayment penalty. There are specific costs associated with prepayment meters, not least that the Post Office is often used as a conduit for payment and charges, and there are some regulatory and system costs. We have acted, we are continuing to take action, and we are introducing reforms to the energy bills to remove this premium paid. For the moment, that will be covered by the energy price guarantee and there will be permanent resolution to the issue in April 2024.
Lord Berkeley (Lab)
My Lords, does the Minister think that the use of the precautionary principle by those who install the prepayment meters is rarely the kind of judgment that these people are expected to make? Are they expected to make a judgment on whether somebody is 85 or 84? Does it not need to be much more clear cut as to who can have the exemption and who cannot?
Baroness Bloomfield of Hinton Waldrist (Con)
The noble Lord makes a fair point but, once all the conditions of the code of practice have been met, there must be at least 10 attempts to contact the customer before a prepayment meter is installed. Then when it is installed, which is often with a bailiff, there has to be body camera footage to show that it has been done correctly. The precautionary principle is a very strong bar. If there is any doubt that the consumer is financially vulnerable, cannot pay, and is at risk of being cut off, the meter must not be installed.
Baroness Lister of Burtersett (Lab)
My Lords, notwithstanding what the Minister said about the precautionary principle, and following my noble friend, are the Government really satisfied that the firm ban on enforced prepayment meters will not cover high-risk groups such as lone parents of a newborn babies, people with Alzheimer’s, and those aged 80 to 84? Surely they are at high risk and should not have to rely on the exercise of the discretion—the precautionary principle—of the installers.
Baroness Bloomfield of Hinton Waldrist (Con)
The noble Baroness mentions some temporary conditions covered by the precautionary principle, which can include pregnancy and bereavement. But if a supplier concludes, taking into account the meter type, the aftercare support, and reasonable energy-saving assumptions, that the household will frequently or for prolonged periods self-disconnect and risk causing significant consumer harm, the supplier must consider the prepayment meter not to be safe or reasonably practical and must not install it.
Baroness Eaton (Con)
My Lords, there is understandably grave concern about the effect of prepayment meters on the vulnerable and disabled. Can my noble friend clarify whether the social tariffs are still an option? Additionally, what is being done to improve the energy bill support scheme voucher take-up?
Baroness Bloomfield of Hinton Waldrist (Con)
My noble friend refers to a number of policies that the Government have put in place to give financial support to consumers, and social tariffs are indeed still an option. Following the Government’s Autumn Statement commitment, we are working with consumer groups and industry to consider the best approach from April 2024 when the energy price guarantee comes to an end, and this could include social tariffs. As for the energy bill support scheme voucher take-up, we have a problem in that, as of 1 March, 97% of vouchers have been delivered since the scheme launched, but only 78% of these have been redeemed. This means that at this time 2.1 million vouchers have been issued to suppliers but not redeemed by households, so we are carrying out extensive communications, including through the Help for Households, to encourage people to redeem these vouchers. We are making announcements through local radio, charities, consumer groups and the media generally to encourage people to take up this support.
Baroness Blake of Leeds (Lab)
My Lords, we have all heard the harrowing stories that come from forced entry into the homes of the most vulnerable people in this country. I would like some more clarification. Surely discretion from the energy companies is not the answer, as we have heard. Why do the Government not take responsibility and continue the ban on installations until a better system is in place protecting the vulnerable. Is not failure to act on this a dereliction of duty?
Baroness Bloomfield of Hinton Waldrist (Con)
The Government were very quick to take action following the Citizens Advice report in mid-January. The Secretary of State responded in late January by writing to Ofgem and all suppliers, and forced installation of PPMs was then stopped within weeks—even before the take-up by the national press campaign—so I do not agree that we have not done enough, quickly enough. The energy, markets and consumer team in the Department for Energy Security and Net Zero is responsible for this. We will monitor Ofgem very closely to make sure that all the provisions that we have put in place to protect vulnerable customers are indeed practicable and enforced.
Baroness Altmann (Con)
My Lords, I congratulate the Government on their scheme to help people with energy costs. That was clearly an appropriate response. But in connection with these forced prepayment meter—or smart meter—installations, will the code of practice include how the meters are installed, whether they are installed in places that are accessible, and whether those who have them are trained in how to use them? It should surely be part of the code to ensure that putting in a meter which elderly and disabled people do not know how to operate does not happen. Installing it at the top of a high cupboard which, if people are elderly and cannot reach it safely but need to stand on a stepladder to press that button and restore their energy supply, should not happen either.
Baroness Bloomfield of Hinton Waldrist (Con)
The noble Baroness makes some very good points. The aim of the code of practice is to set out very clearly how suppliers should protect customers in vulnerable circumstances. This will include minimum steps that suppliers need to take to conclude whether it is actually safe to install a prepayment meter, with greater prescription—as we have heard—about how vulnerability is defined, and enhanced aftercare for PPM users. Additionally, the supplier will have to carry out a site welfare visit before a PPM is installed. As I have said before, all installations of prepayment meters have been paused until suppliers can prove that they are compliant and have given redress measures to those whose prepayment meters have already been installed.
Top Secret Document Leaks
(1 year, 8 months ago)
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Lord Coaker (Lab)
My Lords, it is obviously of huge concern that top secret US documents were leaked, including files purporting to be on the war in Ukraine. In assessing what damage this may have done, are the Government looking into why the Wall Street Journal reported last week that the leak was first put out in January among a small group of posters on a messaging channel that trafficked in memes, jokes and racist talk? This posting in January of top secret files went, according to the Wall Street Journal, unnoticed for weeks by the outside world. If accurate, this is a very concerning matter, so can the Minister look into what did happen and whether that report is accurate? In the light of all this, can the Minister tell us what the MoD is doing to improve security, including data breaches?
The Minister of State, Ministry of Defence (Baroness Goldie) (Con)
I thank the noble Lord for his Question. I am not privy to the content and detail of the article to which he refers, and even if I were, I would be reluctant to comment. As the noble Lord is aware, an internal United States investigation is now taking place and the broader issue is now the subject of investigation by the United States criminal justice system and is sub judice, therefore I am unable to comment further on that. On data breaches, our MoD takes information and data-handling responsibilities very seriously. Following previous investigations, we have introduced measures to prevent breaches recurring—that is a targeted campaign of re-education and retraining. It might be helpful to the noble Lord to know that, for example, when I log on to my MoD desktop I am now immediately presented with an automatic message about keeping equipment safe, and we are now unable to send an email on MoD equipment without being prompted to add a sensitivity label. I must say that that makes me think very carefully about what I am sending and to whom I am sending it.
Baroness Manzoor (Con)
My Lords, I welcome the comments that the Minister made regarding some of the improvements. However, given the seriousness of the security breaches which have occurred within our MoD, what further improvements can she highlight today that have been made to combat this happening again?
Baroness Goldie (Con)
I think the most uncomfortable security breach for the MoD was in 2021, when papers were left at a bus stop. Following that event, the Secretary of State sent a metaphorical dose of syrup of figs through the department. That involved re-education and retraining, with an online security test to be sat, in which Ministers had to participate—I shall not share the results with the Chamber but it was a very pertinent wake-up call—and random bag searches were introduced in the main building for people accessing and leaving the department. I would also say to my noble friend that a risk assessment/risk evaluation exercise, introduced before the security leak in the United States of America, is currently ongoing, and that will be an important contributor to how we can improve further.
Baroness Smith of Newnham (LD)
My Lords, in the other place Dan Jarvis asked the Minister whether he was able to give assurances that data on our Armed Forces held by private sector contractors was fully secured. The Minister said that he assumed so but would go away, find out and write to Mr Jarvis. Can the Minister inform this House whether there is yet an answer to the question? If such data is not securely held, what work will the MoD be doing to ensure that security is improved?
Baroness Goldie (Con)
I do not have the response which my right honourable colleague promised in the other place, but I undertake to ensure that a copy is forwarded to the noble Baroness whatever that response is. Our private contractors operate under a very strict regime, not just in terms of vetting the people they have who have access to sensitive material, but also, in terms of undertakings, those individuals must comply with the Official Secrets Act and with the rules, protocols and all the security practices which we expect. There have been instances where these have been breached and prosecutions have ensued. Therefore measures are in place, but I will make the further detail promised by my right honourable friend in the other place available to the noble Baroness.
Lord Anderson of Swansea (Lab)
My Lords, the leaks reveal the US assessment that there will be an imminent vulnerability of Ukraine to Russian aircraft. What lessons have we learned in terms of early provision of aircraft and countermeasures to Ukraine?
Baroness Goldie (Con)
As I indicated yesterday in responding to a question about Ukraine, we are working in lockstep with our allies through forums such as the G7 and NATO and efforts such as the UK-led International Fund for Ukraine to get Ukraine the firepower it needs to rapidly regain its territory. We are in daily contact. Tomorrow the Secretary of State for Defence will be at Ramstein, the airbase in Germany, at a meeting hosted by the United States. We are also anticipating the NATO summit in Vilnius in July, and we have constant bilateral engagement with our other partners. Everything is being done to ensure that we can respond as meaningfully as possible to what Ukraine thinks it needs.
Lord Craig of Radley (CB)
Media reports suggest that the individual originally responsible is an American of considerable youth who still had access to a great number of very sensitive files. Can the Minister confirm that that indeed is the case and further confirm, as regards the Ministry of Defence and our coverage, that it is not as exposed as the American one seems to have been?
Baroness Goldie (Con)
I can confirm to the noble and gallant Lord that the American criminal justice system has identified an individual, who I understand has been arrested and I presume is detained. On sharing information within our own MoD, we are very careful about where that information is, where it is stored and to whom it is transmitted. As I said in response to an earlier question, very detailed procedures are now in place to ensure that the correct balance is struck. We have to be careful not to obstruct this vital sharing of information, which may be incredibly important to inform discussion and decisions, while ensuring that we balance that with the need to store and manage the transmission of material responsibly and securely.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, given the increased threat from Russia, including recently in the Moray Firth area, which the Minister may wish to comment on, as well as from China, Five Eyes co-operation is even more important. Can the Minister give us an assurance that this unfortunate incident in the United States will not undermine and reduce our Five Eyes co-operation?
Baroness Goldie (Con)
I thank the noble Lord. On the Moray Firth, we have been careful to ensure that our surveillance of maritime activity by Russia is extensive, and we take the security and resilience of our national infrastructure very seriously. As the noble Lord will be aware, we have increased Royal Navy presence patrols and have invested £65 million in the first of our two multi-role ocean surveillance ships. On the relationships with our important allies such as Five Eyes, other NATO partners or other security organisations, going back to the question from the noble and gallant Lord, Lord Craig, we are absolutely clear that our ability to protect our own sovereign states and to act in concert to protect global security depend on acquiring and sharing sensitive information. We all understand the importance of that, but equally we all understand the obligations which attach to it, and the balance to which I refer is one of which all our allies and partners are cognisant.
Lord Bellingham (Con)
My Lords, further to the question from the noble and gallant Lord, my former constituent, the point he made goes to the absolute core of this crisis. The perpetrator, Jack Teixeira, was 21 years old, an airman in the Massachusetts Air National Guard, hardly a key unit at the very heart of the fight against terrorism and the war in Ukraine. He had access to top secret files and substantial Five Eyes intelligence but was a very junior official. Can the Minister make it clear that our Government will do all they can to impress upon the United States and Five Eyes partners that allowing this type of security intelligence to be dealt with by someone so junior is incredibly concerning?
Baroness Goldie (Con)
I do not think anybody would disagree with my noble friend’s assessment. As he will be aware, the Secretary of State for Defence was scheduled to be in Washington—that had been prearranged—but an opportunity will be taken to speak directly about this issue. As always with cases like this, there is something which every state can learn, whether it is a state directly involved or a partner or ally of that state. The gravity of what has happened is completely understood, and certainly we are very sensitive to that within our own MoD. I have indicated some of the measures that have been taken and, following the American incident, our Permanent Secretary immediately instigated action to check that the highest standards were being observed.
Chinese Police Stations in the UK
(1 year, 8 months ago)
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Lord Ponsonby of Shulbrede (Lab)
My Lords, yesterday in the Times newspaper there was a report into a Chinese businessman with links to an alleged Chinese secret police station in Croydon. This report raises serious questions about national security. This businessman, who has attended Chinese Communist Party political conferences, has also attended organised Conservative Party fundraising dinners and other events involving former Conservative Prime Ministers. Although we have raised this issue here before, after police stations were reportedly uncovered in Hendon, Glasgow and Croydon, we have received no update. Meanwhile, operations in New York and the Netherlands have taken action against Chinese police operations, and the Canadian and German Governments have expressed concern about operations in their countries.
Here, we have to contend with the additional dimension that one individual who has been linked to an operation here has links with the Conservative Party and has met Ministers. We know that the director-general of MI5 has warned that Chinese authorities are attempting to exert influence over our political system. Can the Minister tell us the extent of the contact this individual has had with Ministers? What action are the Government taking to look into this role within the Conservative Party and the involvement he has had with the Government? Have any other individuals connected with these operations been identified, and are their similar concerns about them seeking to influence British politics?
The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)
My Lords, I share the noble Lord’s concern about this threat to our democracy, but as the Security Minister said in a previous Statement on this matter in November last year, investigations are still ongoing and it would be inappropriate for me to comment any further on operational matters, as to do so could obviously jeopardise future prosecutions.
However, I take this opportunity to reassure the House of the Government’s resolve to protect every community in this country from transnational repression. As regards the internal party aspects of this, it is my understanding—and if I am wrong, I will obviously come back to correct myself—that this individual was prominent in a particular Chinese organisation within the Cities of London and Westminster. Beyond that, I do not think he had any involvement or contact with Ministers, and, as all noble Lords around the House know, prominent politicians are featured in photographs with very many people, most of whom they will not know.
Lord Wallace of Saltaire (LD)
My Lords, I recognise that it is difficult to comment on this immediate case. Therefore, I raise some slightly wider questions. China is not the only authoritarian state which attempts to catch up with and influence its nationals here. We all recall the occasion when a member of the royal family of one of the Gulf states was taken off the streets in Cambridge and taken back to the Gulf states. Can the Minister assure us that other states and their behaviour in Britain—including some with whom we are relatively closely allied, such as the Gulf states—are also in scope and that the Government are concerned about that?
Secondly, universities have a particularly sensitive role here—I speak as a former academic. Last year, one vice-chancellor told me that his biggest single problem in maintaining free speech in his university was keeping the peace between his Hong Kong students and his Chinese mainland students. I put that down as a marker for further discussion. The Defending Democracy Taskforce was mentioned several times in discussion in the other place yesterday. I tried to find out exactly what it is covering, how far it is intended to have some cross-party representation and what its plans are. It is very difficult to find out whether it really exists, how often it meets, what it is doing and what its strategy is. At a later stage, could the Minister’s department communicate to some of us what the Defending Democracy Taskforce’s intentions are?
Lord Sharpe of Epsom (Con)
The noble Lord raises a couple of very good points. Obviously, any attempt to coerce, intimidate or illegally repatriate any individual will not be tolerated; it does not matter where they are from. The Higher Education (Freedom of Speech) Bill and the National Security Bill both contain provisions to ensure that universities have the tools they need to deal with interference and threats to academic freedom. The noble Lord is quite right to draw the House’s attention to the Defending Democracy Taskforce, which my right honourable friend the Security Minister introduced in the other House in November last year. He has been asked for updates; I have not seen him since those were asked for, but I will make sure that the representations from this House, as well as the other place, are understood. I can also commit that higher education falls within the remit and scope of the Defending Democracy Taskforce, so there will be more to be said on that matter. Noble Lords will also appreciate that there are a number of other areas, including, as I said, the National Security Bill, where we will tighten up our ability to respond to some of these issues.
Lord Deben (Con)
Does my noble friend accept that in a democracy, it is very important that Ministers and Members of Parliament are available to the public as a whole, and it would be a great sadness if this kind of allegation, proven or unproven, becomes a way to ensure that people are unable to reach to the heart of government, as they ought? I hope the Government will continue to state that those who are malefactors should of course be prosecuted with great urgency; but it is very important that those who merely wish to get people in government to understand what is happening in the world—frankly, it is not always obvious that the Government know that—should have access.
Lord Sharpe of Epsom (Con)
I agree with my noble friend. As I said earlier, it is very difficult for any prominent politician of any party, within or outside government, to know precisely who is appearing in a selfie with them. We should be very cognisant of that fact. I also agree that if subsequent bad behaviour, illegal behaviour, is discovered, whatever it may be, the full force of the law should be brought to bear.
Lord Anderson of Swansea (Lab)
My Lords, I concede that the investigation is at an early stage, but is it the Government’s working assumption that this phenomenon is not confined to Croydon and there are other such so-called police stations around the country—looking particularly, I would guess, at Chinese students in the UK?
Lord Sharpe of Epsom (Con)
My Lords, again, it is difficult for me to comment on ongoing matters, but the noble Lord on the Opposition Front Bench mentioned a couple of other police stations that have been aired in the public domain in the past, so yes, it is fair to say that there is more than just one.
Lord Hannan of Kingsclere (Con)
My Lords the advance of autocracy in China since 2012 has been vertiginous. We have seen the creation of a panopticon state where face recognition and location technology are fused to follow and monitor every citizen, and where big online platforms such as Alibaba, Weibo and Tencent both proselytise for the regime and spy on its behalf. Although we often talk of it as Orwellian, I think a better metaphor would come from Huxley, in the sense that even when Chinese students in western universities are put in a place where they do not have censors and firewalls to worry about, they still tend not to look at “dangerous” websites. Will my noble friend confirm that one thing we can do to promote democracy in China is to support the China where democracy and freedom have advanced, especially since the 1990s, namely, Taiwan: a China on the doorstep of red China which shares its language and culture but rejects its totalitarianism?
Lord Sharpe of Epsom (Con)
My noble friend asks a very good question. The UK’s long-standing policy on Taiwan has not changed: we have no diplomatic relations with Taiwan but a strong unofficial relationship which is based, as my noble friend said, on deep and growing ties in a wide range of areas and is certainly underpinned by shared democratic values.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, can the Minister give more details about the situation in Glasgow? Scottish universities are taking in students from China to raise income because there are no fees from Scottish students, and some strange people from China may be getting in under the guise of being students. The Scottish Government have a very strange contract with a Chinese company that is causing grave concern among the public in Scotland. The Scottish Government have been trying to take a greater role in foreign affairs, without the kind of support that the Home Office and Foreign Office have from our intelligence agencies. Can the Minister give an undertaking that the UK Government will talk to the appropriate Scottish Ministers about this issue and make sure that they are dealing with it efficiently and safely?
Lord Sharpe of Epsom (Con)
The noble Lord will appreciate, as I said before, that I am unable to comment on ongoing operational matters and investigations. I listened carefully to what he said, and rather than make that commitment regarding the devolved Administration myself, I will certainly ensure that my noble friend Lord Offord is aware of his concerns and suggest that he looks into them.
Levelling-up and Regeneration Bill
Thursday 20th April 2023
(1 year, 8 months ago)
Lords ChamberRead Full debate Levelling-up and Regeneration Act 2023 View all Levelling-up and Regeneration Act 2023 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 84-XI Eleventh marshalled list for Committee - (20 Apr 2023)
Lord Berkeley
“Cycling, walking and rights of way plans: incorporation in development plans(1) A local planning authority must ensure that the development plan incorporates, so far as relevant to the use or development of land in the local planning authority’s area, the policies and proposals set out in— (a) any local cycling and walking infrastructure plan or plans prepared by a local transport authority;(b) any rights of way improvement plan.(2) In dealing with an application for planning permission or permission in principle the local planning authority shall also have regard to any policies or proposals contained within a local cycling and walking infrastructure plan or plans and any rights of way improvement plan which have not been included as part of the development plan, so far as is material to the application.(3) In this section—(a) “local planning authority” has the same meaning as in section 15LF of PCPA 2004;(b) “local transport authority” has the same meaning as in section 108 of the Transport Act 2000;(c) a “rights of way improvement plan” is a plan published by a local highway authority under section 60 of the Countryside and Rights of Way Act 2000.”Member's explanatory statement
This new Clause would require development plans to incorporate policies and proposals for cycling and walking infrastructure plans and rights of way improvement plans. Local planning authorities would be required to have regard to any such policies and proposals where they have not been incorporated in a development plan.
Lord Berkeley (Lab)
My Lords, it gives me great pleasure to start this day in Committee by moving Amendment 240. I shall also speak to the other amendments in this grouping.
I am very grateful for the support of the noble Lord, Lord Young of Cookham, the noble Baroness, Lady Randerson, and my noble friend Lord Hunt of Kings Heath, who apologises for not being here today. This amendment has the support of the Bicycle Association, Bikeability Trust, British Cycling, Cycling UK, Living Streets, Ramblers and Sustrans. I think you can say that that support basically includes the Better Planning Coalition. Its purpose is to ensure that the various walking and cycling network plans and rights of way drawn up by county councils or combined authorities are incorporated into local planning authorities’ development plans and are reflected in their planning decisions. This would help to safeguard land for new walking and cycling routes or rights of way, including disused railway lines, improve existing routes, and ensure that developments connected with existing or new walking, wheeling or cycling networks with secure development contributions are introduced. This came to a head within the last six months, when National Highways was caught filling in disused railway bridges with concrete to prevent them from being used in the future as footpaths or cycleways, for example. I am grateful that there has been a pause put on that. I hope that it stays a pause, because it was a very stupid decision with no benefit whatever.
This amendment addresses the problems of local planning authorities that sometimes, wittingly or unwittingly, frustrate a higher tier authority’s aspirations for walking, cycling and rights of way by not recording these network aspirations in their development plans. That means that they are not safeguarding the land for these networks or to connect new developments with existing networks for secure developer contributions to implement or upgrade specific routes. There is much discussion going on about all these issues, but it is very important that this covers what is happening now and what might happen in future. The biggest problem is when we have two-tier authorities—county councils or combined authorities, and district councils. In one case, one part of a unitary authority commissioned Sustrans to assesses the feasibility of reopening a disused railway line as a walking and cycling route, while another part of the same authority gave permission for a housing development which blocked the route. There is no point in doing this; it wastes a lot of time and seriously affects the people who want to develop cycling or walking routes.
Local transport authorities have a duty to prepare a statutory local transport plan. They are also responsible for drawing up one or more non-statutory local cycling and walking infrastructure plans. That is all a bit of a mouthful, but really important. Usually it is the same body, but for each one it is required to draw up a statutory rights-of-way improvement plan for its area. We probably all have examples in our own areas of rights of way not being taken very seriously—and we will talk about that later—but all these things need co-ordination.
The Government have argued that our concerns about this lack of co-ordination would best be addressed through the NPPFs, rather than through legislation. My worry is that the current NPPFs, which are still in proposed revisions, mention these local cycling, walking and infrastructure plans only in passing, leaving out the right-of-way plans altogether. This results in developments being granted permission without taking into account the need for walking and cycling or improving these links. I call it active travel—it is a bit shorter. I am sure that the Minister will take this amendment seriously, and I hope that she gives me a nice positive response to it and says that perhaps we can have further discussions and see what happens.
My Amendment 470, on electric vehicle charging, is quite a short amendment. It requires a change to the Electricity Act, for the Government to facilitate or accelerate the rollout of electric vehicle charging points for domestic and commercial customers. We have discussed this in your Lordship’s House quite a few times. A few statistics really worry me, frankly. First, the Government have a target of 300,000 public charging points by 2030, and there is a long way to go before we get there. Interestingly, a Written Answer from the Minister on 29 March to the noble Lord, Lord Taylor of Warwick, stated that the number of installations were 8,600 public charging, 71,000 electric vehicle home charge schemes, and very few electric charge point sockets and grants, while workplace had 15,000.
Another telling Written Answer, to the noble Baroness, Lady McIntosh of Pickering, on 21 March, stated that
“the majority (around 75%) of electric car charging happens at home, as it is often cheaper and more convenient for drivers.”
I am sure that the Minister is right, but the problem is: how many people have home charging? I expect many noble Lords here have home charging, if they want it, but there are an awful lot of people in this country who park on the road and, if they want to charge their cars, they will have to get it off a lamppost.
Another Written Answer from the Minister said that there was no national data on how many lamppost chargers were available. If we do not know how many are available, we do not know who wants them, and we do not know where the public ones are, where do you charge your heavy goods vehicle or coach? Who will fund them? Most important of all, what about the regulation of chargers? There is a lot for the Government to do to meet their target of 300,000 charging points by 2030.
Finally, I support the amendment tabled by the noble Baroness, Lady Randerson, on the same subject. I am sure that she will tell us a great deal more of it. I beg to move.
Lord Young of Cookham (Con)
My Lords, in this debate on transport, it is a pleasure to follow in the slipstream of the noble Lord, Lord Berkeley, and add some footnotes to his speech on Amendment 240.
Before I turn to the amendment, I will say a word about the target of 300,000 EV chargers. Some chargers are fast chargers and some are slow chargers. At some point, we need to define more accurately the division of those 300,000. If they are all slow chargers, that will not do the trick. If they are fast chargers, we may not need quite so many. So a bit of granularity on that target at some point would be welcome.
Researching for this debate, I came across a government document stating that
“continuing growth in road transport and consequential environmental impacts present a major challenge to the objective of sustainable development. Traffic growth on the scale projected could threaten our ability to meet objectives for greenhouse gas emissions … and for the protection of landscapes and habitats”.
I should have recognised it instantly, as it was in a document that I published nearly 30 years ago when I was Planning Minister. It was PPG13, which offered advice to local authorities on integrating land-use planning and transport. Its object was to reduce reliance on the car by promoting alternative means of travel and improving the quality of life.
I note in passing that I referred to the then Government’s policy of increasing the real level of fuel duty by an average of at least 5% a year—a policy now very much in the rear-view mirror—and also my commitment to introducing electronic tolling on motorways. Back in 1993, I was clearly a little bit ahead of the game.
Amendment 240 could almost have been lifted from PPG13. It promoted development within urban areas at locations highly accessible by means other than the car, and it supported policies to improve choice for people to walk, cycle or catch public transport, rather than drive between homes and facilities that they need to visit regularly.
I also came across an article in the Independent from 10 July 1995, when I became Transport Secretary and continued my campaign. In an open letter to me, Christian Wolmar wrote:
“When your appointment as Transport Secretary was announced, the whoops of joy from cycling campaigners could be heard across the nation. The notion of having a Transport Secretary who is not only an active member of Friends of the Earth but also an active cyclist and tandem rider was beyond their wildest dreams”.
So, the Minister will not be surprised that, as middle age taps me on the shoulder, my commitment to environmental means of transport is undimmed.
The noble Lord, Lord Berkeley, set out the case for the amendment, which I believe is even stronger than it was in the 1990s. I will not repeat it. I understand from the Government’s response to a similar amendment in another place that, instead of an amendment to primary legislation, the objectives to the amendment should be incorporated in a revised NPPF, as the noble Lord, Lord Berkeley, has just said. My response is that I tried that and it did not work. We need to be more assertive.
Paragraph 1.10 of PPG13 said:
“If land-use policies permit continued dispersal of development and a high reliance on the car, other policies to reduce the environmental impact of transport may be less effective or come at a higher cost”.
That is exactly what has been happening, as the Government’s own publication, Gear Change: A Bold Vision for Cycling and Walking, published in 2020, recognised. Despite the exhortation in that PPG and, I suspect, many other PPGs since, we have not seen the transformation in planning for transport that is required. We continue to build housing with little or no public transport provision, or where it is impractical to get to school, the shops or work without jumping into a car. We must up our game and cease relying on guidance.
The amendment also addresses the problem touched on by the noble Lord, Lord Berkeley, that has arisen in two-tier authorities, where, typically, the county council is the transport authority but the district council is the planning authority: if you do not have the commitment to walking or cycling networks recorded in the district plan, this can then frustrate the county’s ambition to promote cycling and walking networks—clearly an undesirable outcome.
The challenge to my noble friend, who I am delighted to see is replying to this debate, is to convince me that we should continue to rely on guidance, as I suspect my officials advised me to do in 1993, despite the evidence that it has not brought about the transformation that I aspire to. I wish her every success.
Baroness Randerson (LD)
My Lords, I am pleased to speak to a number of amendments in this group, to which my name is attached. This is, of course, a group of transport-related amendments. Like the noble Lord, Lord Young, I am very pleased to see that we have the Transport Minister here to respond in detail to us, because all the warm words on levelling up are meaningless without decisive action to improve transport infrastructure and services. Poor transport facilities almost exactly mirror the overall picture of the social divide in our country: poorer areas have poor public transport and poor transport infrastructure generally.
There is a reason why London and the south-east are the richest parts of the UK: they have the transport links to service the areas well, and one reinforces the other. I say that while recognising of course at the same time that there is poverty and disadvantage amongst the most privileged.
I start with Amendment 240, to which I have added my name. The noble Lords, Lord Berkeley and Lord Young, have spoken in some detail, and with greater information than is necessary for me to repeat here today. But I want to endorse the fact that this has to be about broadening access to the activities of cycling and walking and safeguarding our rights of way: for many decades, we have been accustomed to the gradual erosion of the practicality of safe walking and cycling, and the erosion of our rights of way on footpaths. The car has been king for a very long time. If we are going to truly improve the quality of our lives and the lives of the generations to come, we need a much broader and more informed approach. In my own local area, I notice the cycleways that disappear into nothing at key junctions and so on. It is a skilled business to provide really good cycling and walking facilities.
Turning to Amendment 468, the intention here is to prioritise the requirements for disability access at rail stations. Progress on this has been painfully slow—way too slow. I use this opportunity to praise the work of the noble Baroness, Lady Grey-Thompson, and my noble friend Lady Brinton, who raise these issues time and again in the media and in this House. We live in an ageing society, and we should be much more encouraging to those people who are less mobile but who want to travel by rail or bus. So this amendment goes way beyond the simple issues of wheelchair access, access for those with sight impairment and so on. It is about access for people who are less agile.
However, treatment is far from being on an equal basis for those people in wheelchairs. As a regular rail traveller myself, I watch this week after week. Despite huge efforts by the staff, there is still so much further to go. We have to ensure that people do not have to book way ahead in order to be able to make a simple journey.
Lord Berkeley (Lab)
Could the noble Baroness explain whether rapid or fast is the faster of the two?
Baroness Randerson (LD)
Rapid is faster than far, but that would not be obvious to the average local public sector employee whose job it is to ensure that there is adequate infrastructure for EVs.
My Amendment 486 requires the Government to update us regularly on their strategy to improve the charging network. It particularly refers to the discrepancies across the country. The discussion often relates to the pure numbers of charge points, but just as important are two different factors. The first is the adequacy of the numbers available in public places. The noble Lord, Lord Berkeley, has made that point. Currently, EV ownership is concentrated among more affluent people—those with drives and who can therefore have chargers attached to their homes. We cannot have an EV revolution that is only for the rich. People who live in terraced houses and in flats must also be able to own EVs. As the revolution plays out and a second-hand market develops for electric vehicles, this becomes an ever more pertinent point. The second factor is that the Government have emphasised time and again that they believe that the market will adequately take care of the provision of charge points, but the figures do not bear that out. London and the south-east have a far more generous ratio of electric vehicles to public charge points than any other part of the UK.
My conclusions are that particular problems need to be addressed. The first is the disparity in cost between home charging and public charge points. If you charge at home, you pay 5% VAT; if you charge in a public car park, a public place or from a lamppost, you pay 20% VAT. That reinforces the unfairness. I urge the Government to deal with the issue soon as otherwise it will hamper any of their best intentions on this issue.
The second conclusion is that the Government must work much harder to increase support and funding in areas that have large gaps in their electric vehicle infrastructure. They are often towns in poorer areas and, of course, almost every rural area. Local authorities have a key role in this but often need greater advice because officials do not know the difference between fast and rapid and so on. They need not just money but support and advice to help them, otherwise EVs will remain vehicles for rich areas and poorer areas will remain subject to suffering from poor air quality.
My final point on this is that the Government simply must address the delays in national grid connection. They are hampering the whole thing which is totally inadequate to service the revolution that needs to take place.
In relation to Amendment 48 from the noble Baroness, Lady Bennett, I live in Wales. This week, 20 miles per hour became the default speed limit throughout the country. I live in Cardiff, where it has been the default speed limit for some time, and we have all—more or less—got used to it. The traffic flows more smoothly.
Baroness Bennett of Manor Castle (GP)
My Lords, I guess I should rise at this point to follow with pleasure the noble Baroness, Lady Randerson, who made a point that I was going to make. I note that in Scotland, they are going for 2025. This is a case where England urgently needs to catch up. I will primarily speak to Amendment 482. It is very simple:
“for “30” substitute “20”.
This is a “20 is plenty” amendment. I am going chiefly to speak to that, but I note that this is a very neat and fit group of amendments.
We express Green support for Amendment 240. We obviously need to get active transport joined up to make preparation to make sure that it happens. Also, we support Amendment 486 from the noble Baronesses, Lady Pinnock and Lady Randerson, on disability access in railway stations. Of course, we broadly agree with electric vehicle charging points. However, on the interaction between these two issues, we have to make sure that where vehicle charging points are installed on roads, they do not make the pavements less accessible, particularly for people with disabilities, with strollers and other issues. The space should be taken from the road and cars and not from pedestrians.
Returning to my Amendment 482, this would make the default general speed limit for restricted roads 20 miles per hour. Among the many organisations recommending this is TRL, formerly the Government’s Transport Research Laboratory. Going from the local to the international, there was of course the Stockholm Declaration, adopted by the UN General Assembly in 2020, which recommends 20 miles per hour speed limits where people walk, live and play. That is the global standard that the world is heading towards, and we really need to catch up on this. I can see much nodding around your Lordships’ House. I am sure many noble Lords know that pedestrians are seven times more likely to die if they are hit by a vehicle travelling at 30 miles per hour compared with 20 miles per hour. If they are aged 60 or over, they are 10 times more likely to die when hit by a vehicle at 30 rather than 20.
Noble Lords might say this is the levelling-up Bill rather than general provision, but to draw on just one of many reports that reflect on this issue, Fair Society, Healthy Lives: the Marmot Review says that targeting 20 miles per hour zones
“in deprived residential areas would … lead to reductions in health inequalities”.
However, there is, of course a problem. The Marmot report was looking within the current legal framework for travel, but it is extremely expensive to bring in local areas of 20 miles per hour speed limits. There needs to be local signage and individual traffic regulation orders, and then presumably, if there is to be some hope of compliance, there needs to be an education campaign. All of those things cost money, and councils in some of the poorest areas of the country will find it most difficult to find those funds.
If we think about some of the other impacts, as well as road safety, 20 miles per hour speed limits where people live, work and shop reduce air pollution and noise pollution. These are things that particularly tend to be problems in the most deprived areas. The wonderful 20’s Plenty for Us campaign that has been working on this for so long, and increasingly effectively, notes that there is a 30% reduction in fuel use with “20’s plenty”, so it saves people money as well—something of particular interest to the most deprived areas of the country.
This is a very simple measure, by which we could catch up with other nations on these islands and really make an improvement to people’s lives, health and well-being. I have focused on the practical health impacts, but the reason this group of amendments fits together so well is that, if you want to encourage walking and cycling, then ensuring that the vehicles on the road travel more slowly is a great way to open up the entire road network to cyclists and walkers. Of course, it could also build communities: the reduction in noise pollution gives neighbours more of a chance to chat over the garden fence and build those communities that we desperately need.
The Earl of Lytton (CB)
My Lords, my name is attached to Amendment 470 in this group, and it is a particular pleasure to follow the noble Lord, Lord Berkeley, on this. I would like to say a few words about the question of footpath access that he addressed initially. It seems to me—and it was amply spoken to by the noble Lord, Lord Young of Cookham—that this is part of the essential infrastructure that enables people to have what used to be, and I hope still is, known as multi-modal travel opportunities. In other words, one has at least some sort of menu of options, and one is not just obliged to be in a motor vehicle. This goes to the heart of what we do about making sure that developments are both related to existing settlements, where these facilities are available, and do not become detached from that unless there is some particular reason—and then only when this infrastructure is put in. So I am very much in favour of that.
Baroness Pinnock (LD)
My Lords, I was reflecting that we have barely mentioned levelling up in the last two Committee days. Yet my noble friend has helpfully raised the importance of relating everything we do to the levelling-up missions, which include references to accessible public transport in order to enable accessibility to employment. That was timely.
My name is on Amendment 468, which is about accessible railway stations. I will not repeat what my noble friend said because I cannot add anything, except that I endorse her praise of the work of the noble Baroness, Lady Grey-Thompson, and my noble friend Lady Brinton, and their consistent determination to keep accessible public transport at the forefront of our thinking. If public transport is accessible to the least mobile, it is much better for everyone else, those who are mobile; it makes it better for everyone.
I will briefly speak to Amendment 240, in the name of the noble Lord, Lord Berkeley, because some planning issues are related to it. Everything he said is quite right. The NPPF, which we have mentioned several times, already has a policy on retaining public rights of way, cycle networks, bridleways and so on. Therefore, many local plans will incorporate them, including that of my own council, which
“will support development proposals that can be served by alternative modes of transport such as public transport, cycling and walking”.
The council says:
“The core walking and cycling network as shown on the Policies Map will provide an integrated system of cycle routes, public footpaths and bridleways that provide opportunity for alternative sustainable means of travel throughout the district and provide efficient links to urban centres and sites allocated for development in the Local Plan”.
I thought that all local plans would incorporate such policies, although, from what the noble Lord, Lord Young of Cookham, said, this is clearly not the case. He pointed to the division of responsibilities for highways between the counties and districts, for planning purposes. Therefore, when plan-making, I hope the Government will have a requirement—they may already have one, but if so, it needs to be underlined—to incorporate the highways policies of the responsible council concerned. That would solve at least one of the problems raised.
The fundamental problem with a lot of our planning development policies—I raised this in a different context on the last Committee day—is implementing them. As with my council, we can have grand and worthy policies on retaining the public rights of way network, cycleways, bridleways and all the rest of it, but when that comes up against commercial development interests, I can tell noble Lords now that those interests always win. We have to find a way of balancing that better.
Of course, if a public right of way goes through a commercial developer’s site, it will want to adjust it, but this always has to be in the best interest of the public right of way as well; however, that often does not happen. For example, a development site in my locality abuts the M62, and a historic public right of way went through the middle of it. Of course, the developer did not want to retain it, and the proposal was to divert it so that it ran along the M62. Who would use that? Some of us managed to get it put elsewhere on the site—but that is what we are up against. This is my plea to the Minister, and it is a big challenge for all the wonderful policies we have discussed: how can we ensure that they can be implemented when they are up against commercial interests? That is the key because currently, commercial interests have the upper hand in the end, and in my experience they always win.
Perhaps the Minister will be able to tell me that all new planning applications are required to have an electric vehicle charging point, because that would make sense. My council requires this. This could go into the NPPF, and, if it is not possible—because flats are being considered—there could be a requirement for public provision in the locality of the development.
My noble friend Lady Randerson raised a big challenge about the differential VAT charges. This is outrageous: I had not realised that public charging points have higher VAT attached to them than domestic ones. If we are really going to encourage electric vehicle use, which we must, surely a tax incentive is one of the ways to do so. With those words I look forward to what the Minister says.
Baroness Taylor of Stevenage (Lab)
My Lords, I support Amendment 240 in the names of my noble friends Lord Berkeley and Lord Hunt, the noble Lord, Lord Young, and the noble Baroness, Lady Randerson. Before I turn to the specific amendments in this group, I will mention the very helpful discussion which took place in Grand Committee on Monday on the Built Environment Select Committee’s report on public transport in towns and cities. The committee’s recommendations were very helpful to our consideration of this Bill. I thank the chair of that committee, the noble Lord, Lord Moylan, and his predecessor, the noble Baroness, Lady Neville-Rolfe, the members of that committee and all those who gave evidence.
The Minister—the noble Baroness, Lady Vere—was part of that discussion so there is no need for me to go through all the points relevant to the Bill, which I am sure she will pass on to her colleagues in the Transport team and the DLUHC team. However, it was the overwhelming view of the committee and all noble Lords who took part on Monday that a formal link should be introduced between local plans and local transport plans. In view of the amendments in this group, it is important to record that strongly held view today.
Can I say how much I agree with the noble Baroness, Lady Randerson, about the importance of transport to the levelling-up agenda? Like the noble Lord, Lord Young, and the noble Baroness, Lady Randerson, I too am very pleased to see the Minister responsible for transport here today to respond to the debate. As the fortunate resident of a town designed with 45 kilometres of cycleway built into it, it is unthinkable to me that planning for cycling and walking, and considering at local plan stage the infrastructure needed to support that, would not be in the Bill and intrinsic to the planning for our communities. If this amendment is accepted—I really hope it will be—then the subsequent NPPF or whatever is going to succeed that will need to take account of the anomalies that occur in these aspects of planning in two-tier authorities. My noble friend Lord Berkeley referred to that earlier.
Generally these can be resolved through good liaison between authorities, but consideration should be given, as responsibility for both transport and rights of way sit with county councils, as we have heard, whereas the local plan is the responsibility of the district council. It will also need to be clear in terms of rights of way improvement plans that the responsibilities for maintenance—should it be necessary—ransom strip land purchase and so on remain the responsibility of those authorities which currently hold them. To be clear, the fact that a planning authority includes them in its local plan does not necessarily incur any additional financial or legal responsibility for these matters than existed previously. Concerns about lack of co-ordination through the National Planning Policy Framework were referred to by my noble friend Lord Berkeley, and including this provision in the Bill might encourage authorities to work together where that is not the case already.
In relation to Amendment 468 in the names of the noble Baronesses, Lady Pinnock and Lady Randerson, I echo comments about the tireless work of the noble Baronesses, Lady Brinton and Lady Grey-Thompson. It is very important to clarify that this should apply to all railway stations, including retrospectively. I know that is a difficult issue and how it works together with other disability legislation, such as the Disability Discrimination Act, should be clearly identified. There are already some provisions in there but I do not think it goes as far as we would want it to and the proof of that is what we see in our local railway stations. We heard many of examples of that during the debate.
It is, of course, crucial that we do all we can to make our rail system accessible, safe and user-friendly for all passengers. Indeed, we will never make the quantum leap in switching from private car travel to public transport that we need to reach zero carbon without such measures. I come back to the Built Environment Select Committee’s inquiry into public transport, which has very clear recommendations on this subject. As the noble Baroness, Lady Randerson, said, progress has been painfully slow on this to date and we need a bit of a rocket under it to get it going again. The very helpful introduction of things such as senior railcards is of far less use if you need to navigate several flights of stairs to cross even from one platform to another.
Amendment 470 in the names of my noble friend Lord Berkeley, the noble Baroness, Lady Scott of Needham Market, and the noble Earl, Lord Lytton, requires the Secretary of State to facilitate the accelerated rollout of EV charging points for domestic and commercial customers. I strongly support this very laudable aim but there are still unresolved issues. First, as the noble Lord, Lord Young, and the noble Baroness, Lady Randerson, have both identified, we are already seeing inequalities develop in EV charging provision and we need to watch out for that very carefully, particularly in the context of the Bill.
Then there is the issue of technology and whether it is settled enough yet to encourage the considerable cost of a UK-wide rollout. Many of us in this Chamber will remember the issues around VHS and Betamax. That is the classic example of when, if you jump early to the wrong technology, it can be very expensive indeed. Many noble Lords referred to improvements in very fast charging facilities and the way that picture is developing so rapidly. It is difficult to know when that will settle. The noble Lord, Lord Young, referred to the difference between fast and slow chargers, and we need to make sure that we get the most up-to-date provision wherever it is possible.
Secondly, in terms of domestic provision, the complex issues referred to by noble Lords by this afternoon of on-street charging must be resolved. For those fortunate enough to have a drive or land at the side of their property where charging points can be installed, it is not such an issue, but if you live in a terraced street and in housing where that is not so easy to do, it is. The noble Baroness, Lady Bennett, rightly made the point that this should not interrupt easy walking access for residents. For properties with no adjacent parking, installation of EV charging points can prove expensive and very disruptive in terms of cable laying and so on. My noble friend Lord Berkeley raised this issue too; we have to be concerned about it. Lastly, I have a slight concern that giving this responsibility in legislation to the Secretary of State will simply result in it and potentially the resultant cost and headaches being transferred to local authorities. That is something we need to think carefully about.
I also agree with noble Lords who have said that National Grid really has to get its act together on this issue. Even in developments I have been engaged with in my own borough, it is very often National Grid that really holds things up on many of the measures that we want in levelling up and regeneration. We need to work on how National Grid can respond more quickly to these developments.
No doubt, all those issues could be considered and resolved and there is clearly an urgent need to accelerate the provision of EV charging. My noble friend Lord Berkeley mentioned 8,000 public charging points. This is woeful. The noble Lord, Lord Young, mentioned that this has been flagged up for over 30 years now. We can all remember talking about this many decades ago, so surely it is time now that we made urgent progress.
I turn now to Amendment 482 from the noble Baroness, Lady Bennett of Manor Castle. At the moment, some local authorities do a very good job of making the case to residents in their communities for reducing speed limits, and I pay tribute to campaign organisations such as 20’s Plenty for Us that are producing fantastic support on that. In addition to the points that have been made about it, I also mention that the reduction in pollutants at lower speed is a key issue here as well as the other benefits in noise pollution, safety for other road users and so on.
We believe that this is an area where decisions are far better taken locally so that benefits can be explained fully as the change is implemented. I pay tribute to Hertfordshire County Council, which has worked very closely across the county with local councillors and their communities to develop an evidence base, introduce consultation with members and the communities that they represent and then put appropriate funding allocation in place, first on a pilot basis and then more widely across the county. That is a very good example, and it was lovely to hear another example of how the Welsh Labour Government are leading the way in this respect.
Amendment 486 in the name of the noble Baroness, Lady Randerson, refers to the need for the Government to update Parliament on progress against their EV infrastructure strategy, which was published in March 2022. Irrespective of the comments I made earlier about the complexities of introducing EV charging, at the very least the Government should be delivering against the strategy they have set for themselves. The disparity in provision from place to place is as important as the sheer number of charging points available, so we certainly support the amendment.
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)
My Lords, I am very pleased to make my debut on the LURB. I am sorry that it has taken so long, but I may be back again in due course, should there be more transport amendments. Today, it is my job to address this group of amendments, which relate to transport; there are four, and I shall address each in turn.
I start with Amendment 240, in the name of the noble Lord, Lord Berkeley, which relates to cycling and walking and to the role of active travel in local development. I think that all noble Lords agree that the Government recognise the importance of walking and cycling and the role that the planning system plays in enabling development in sustainable locations, supported by active travel infrastructure. It is already the case that national planning policies must be considered by local authorities when preparing a local plan and are a material consideration in all planning decisions. The Bill does not alter this principle and will strengthen the importance of those national policies which relate to decision-making.
The existing National Planning Policy Framework is clear that transport issues, including opportunities to promote walking and cycling, should be considered from the earliest stages of plan-making and when considering development proposals. The NPPF also states that policies in local plans should provide for attractive and well-designed walking and cycling networks with supporting facilities, such as secure cycle parking, drawing on local cycling and walking infrastructure plans. The NPPF also places environmental objectives at the heart of the planning system, making it clear that planning should protect and enhance our natural environment, mitigate and adapt to climate change, and support the transition to a low-carbon future. The Government have recently concluded a consultation on changes to the NPPF to ensure that it contributes to climate change mitigation and adaptation as fully as possible.
I always react with some trepidation when my noble friend Lord Young of Cookham shares his thoughts with your Lordships’ House. He has an enormous amount of experience in this area—and, it would seem, in most areas of government. He challenged me to explain why we think the guidance will achieve our aims. I believe that it is more than just guidance; the NPPF and the new national development management policy set out the Government’s planning policies for England and how they should be applied. These are material considerations in planning decisions. The power in securing positive change for communities is substantial and should not be referred to as just “guidance”.
There is another step forward—perhaps slightly towards where my noble friend would like us to be—with Active Travel England. Many noble Lords will know that Active Travel England was set up relatively recently, and its role will expand over time. It will become a statutory consultee on certain major planning applications from June this year. That means that local planning authorities will be required to consult ATE on planning applications, where developments meet one of the following minimum thresholds: where it has 150 residential units; where it is 7,500 square metres of commercial area; or where it is a site with an area of 5 hectares or more. Furthermore, ATE will also take an active role in supporting the preparation of local plans and design codes.
It is also worth reflecting that local plans must be put in place quickly, and so we must avoid imposing a plethora of additional statutory requirements which local authorities must have regard to, especially when clear expectations are already set through national policy. There is one other—
Baroness Pinnock (LD)
I apologise to the Minister, but could she explain to the House where the balance lies between commercial interests and their development, and the policies that she has rightly described as very positive and as needing to be put into place? In my experience, the balance is currently in the hands of the commercial interests.
Baroness Vere of Norbiton (Con)
I had better write with more details on that subject. As noble Lords will know, I have not been involved in the Bill for very long but, reflecting on some of the contributions to the Built Environment Committee, I sometimes question whether noble Lords have any confidence in local authorities at all. If the noble Baroness is asking what the balance is between commercial interests and other local interests, I ask: do we not want the local authority to be making those decisions for its local communities and therefore granting planning permission on that basis? In terms of how we would provide the overarching vision for that, I am very happy to set that out in more detail in a letter.
Baroness Taylor of Stevenage (Lab)
My apologies for also interrupting the Minister. I know that she has not been part of previous discussions on the National Planning Policy Framework with regard to the Bill, or the sequence of events as to when we will see the finalised version of the NPPF, but noble Lords have expressed concern that we are being told that some things are going into one, while other things are going into the other. Because we will not see the finalised version of the National Planning Policy Framework before the end of Committee—unless the Bill goes on even longer than it already has—we have concerns that we will not understand what is going into one and what is going into the other. I repeat that point again, because it is very important to some of the previous points under discussion in earlier days in Committee about how the two fit together.
Baroness Vere of Norbiton (Con)
Indeed, I am aware that those conversations have been happening and, as a Transport Minister, perhaps I had better not add anything further. However, it is worth highlighting that the Government are taking forward other policies for cycling and walking, which I believe will be helpful to local authorities in thinking about how cycling, walking and active travel are taken into account when it comes to local development. The Manual for the Streets guidance is incredibly important and is being updated. We are also planning to refresh the guidance supporting the development of the local transport plan.
It is also worth noting the tens of millions of pounds that the Government have awarded to local transport authorities to upskill the capacity and capabilities of their staff to ensure that things happen. For example, the noble Baroness, Lady Pinnock, mentioned her council in Kirklees, where things all seem to be tickety-boo. Therefore, I would expect other local authorities to look at that council to try to emulate that because, essentially, we want local decisions to be taken locally—that is at the heart of this matter.
I turn now to the amendment on railway accessibility in the name of the noble Baroness, Lady Pinnock. I appreciate the contributions made by the noble Earl, Lord Lytton, and the noble Baroness, Lady Randerson, providing details of specific areas where we need to make improvement. Improved access to the railway is a key priority for the Government. The Transport Secretary is committed to funding transport infrastructure improvements, including improvements to stations to make them more accessible for disabled passengers. The Department for Transport has already invested £383 million under the Access for All programme between 2019 and 2024, and there is more to come.
The Design Standards for Accessible Railway Stations, published in 2015, set out the standards that must be met when new railway infrastructure or facilities are installed, renewed or replaced. Noble Lords may question the date of 2015 and say that it is a little while ago, but I reassure them that the process is being set out at the moment as to how the standards will be refreshed.
Noble Lords will also be aware that the Government have now completed an audit of all stations across the network. That data will be shared with Great British Railways; it will be made public; and that will be very helpful for ensuring that as many people as possible who are less mobile can travel. I accept, however, that some stations remain less accessible. Can we fix them all at once? I am afraid we cannot, but I would like to reassure the Committee that all stations, regardless of size and location, are eligible for funding under the Access for All programme.
Baroness Randerson (LD)
I am very pleased to hear about the Government’s commitment and that we will soon get details that will help us on this. We all acknowledge that you cannot do it all at once. What we want to see is progress, so I was very disappointed to read about the Network Rail briefing this week, which became public. It said that the amount of money available was not enough to maintain existing standards of reliability on the railways, let alone make progress with improving accessibility. The noble Baroness might like to make a comment on that.
Baroness Vere of Norbiton (Con)
The noble Baroness would probably decline to make a comment on that at this moment, as that would take us far away from the area of accessibility, which is under consideration today. However, the noble Baroness asked whether progress had been made. So far, step-free accessible routes have been delivered at 200 stations, and smaller-scale access improvements have been made at 1,500 stations. We have made progress; there is much more progress to come; and we are absolutely committed to making it.
Amendments 470 and 486 relate to the charging of electric vehicles, I share all noble Lords’ concerns about electric vehicle charge points and how important they are as we decarbonise our transport system. The first of the two amendments seeks to amend the Electricity Act 1989 to add an explicit reference to electric vehicle charge point provision in addition to the need to
“secure that all reasonable demands for electricity are met”.
The Electricity Act 1989 already requires the Secretary of State to give regard to securing that all reasonable demands for electricity are met. This requirement already includes the charging of electric vehicles. We therefore believe that the amendment is unnecessary, and indeed that it might be unhelpful to other equally critical areas of the decarbonisation effort such as, for example, heat pumps. In carrying out this duty under the Electricity Act, the Secretary of State works closely with Ofgem, as the independent energy regulator is responsible for regulating network companies to ensure that sufficient grid capacity is built and operated to meet consumer demand. Of course, we work very closely with Ofgem as price controls are developed, so that our work aligns to meet the needs of customers, including electric vehicle users.
We are investing £3.1 billion for network upgrades to support the uptake of electric vehicles and heat pumps. This is significant upfront funding and, combined with an agile price control system for net zero-related expenditure, it will enable the investment in the network infrastructure needed to facilitate heat and transport electrification.
There were a number of questions around the provision of charge points themselves. The noble Baroness, Lady Pinnock, asked about new homes. We laid legislation that came into force in June last year requiring most new homes and those undergoing major renovation with associated parking in England to have a charge point or a cable route for charge points installed from the outset. We estimate that this will lead to the installation of up to 145,000 new charge points across England every year.
The noble Lord, Lord Berkeley, asked about home and business charge points. The Government have supported the installation of about 400,000 of these charge points. Of course, there will be many, many more out there that have been installed without government support—and, to my mind, long may that continue.
I turn now to the second of the two amendments on charge points, which relates to reporting. I do not believe that this amendment is necessary, because I am pleased to confirm that the Government routinely publish monthly and quarterly EV public charging device statistics. These are broken down by device speed category, region and local authority area. The latest report outlined that, as of 1 April, there are more than 40,000 available public charging devices, of which more than 7,600 are rapid or above charging devices—a 33% increase. We also routinely publish the number of devices funded through government grant schemes. As I pointed out, many more will be installed that are not funded by the Government, and we would not necessarily be able to find out where they are. If there is further information that the noble Baroness would like about public charging points that we might reasonably be able to gather, I would be very happy to discuss this with her further. I have noted the other comments on EV charge points and will reflect on them further.
Finally, I turn to the amendment in the name of the noble Baroness, Lady Bennett of Manor Castle, about a blanket reduction on restricted roads from 30 to 20 miles per hour. I noted some of the comments from the noble Baroness, and I agreed with some of them. None the less, I am not convinced that a blanket application of this lower speed limit is appropriate because, again, it would undermine local decision-makers’ ability to set the most appropriate speed for the roads in their area, based on local knowledge and the views of the local community. Actually, I am pleased that the noble Baroness, Lady Taylor, agrees with me. Indeed, she seems to agree with me for England but not for Wales, where it is not something that a local authority can decide.
Baroness Taylor of Stevenage (Lab)
I believe there was widespread consultation from the Welsh Government with Welsh local government in terms of doing this. I have that in my notes, but my notes are a bit scribbly and I missed it out. May I just make the point that the Welsh Government, as they always do, have consulted very widely with Welsh local government on this?
Baroness Vere of Norbiton (Con)
That is fantastic to hear, and I am sure that all local authorities 100% agreed with the Welsh Government in that regard.
The second element to this is that a blanket approach would be—
Baroness Bennett of Manor Castle (GP)
Would the Minister acknowledge that 30 miles per hour was, of course, the blanket applied by Westminster? That is what has been set by Westminster, and it is of considerable cost for councils to apply a reduction. We are discussing the levelling-up Bill, and it is councils in the poorest areas of the country that would see the greatest benefits but may well not have the money to be able to bring in that improvement for their residents.
Baroness Vere of Norbiton (Con)
I was about to come on to the fact that changing the speed limit on a blanket basis would be incredibly costly and complex to introduce. I go back to the first point, which I believe is the stronger of the two arguments, because you can throw money at anything and make it work. Local authorities quite rightly have the power to set speed limits on the roads in their areas. Many local authorities have decided to do 20 miles per hour zones in all or parts of their area, and that is entirely up to them. We endorse that approach in Department for Transport guidance and, particularly, we think that that is something that should be considered where pedestrians, cyclists and vehicles are all in close proximity. However, they are not always in close proximity. There will be roads which the local community and their local elected leaders will decide should stay at 30.
If one were to apply this blanket change to 20 miles per hour, what would happen is that all of the repeater signs for 20 miles per hour that already exist for those areas that are 20 miles an hour would have to be removed, or there would have to be repeater signs for 30 miles an hour put in. This would, of course, be after the local authority had gone through its entire road network to figure out which roads should be at which speed. So I believe that where we are at the moment provides the balance between ensuring that local people are taking responsibility and decisions for matters that affect their local communities, based on their local knowledge. The corollary to that is that if one applies a blanket approach now, it would be very costly, as the noble Baroness has already pointed out herself.
With the assurance that I have given in relation to each of the amendments in this group, I hope that the noble Lord, Lord Berkeley, will feel able to withdraw his Amendment 240 and that the other amendments in this group are not moved when they are reached.
Lord Berkeley (Lab)
I am grateful to all noble Lords who have spoken in this excellent debate. Many of them are probably the usual suspects on these things, but it has been a useful debate, reinforcing many of the views that we have all held for a long time. The noble Lord, Lord Young of Cookham, mentioned PPG13; I remember it when I was in the commercial side, which is a very long time. Christian Wolmar is still chair of the Labour transport group and we are both patrons of the All-Party Group for Cycling and Walking. The group held an event in Portcullis House yesterday and Mr Wolmar was there promoting this. It is working very hard, which is good to know.
I will not respond to all the other comments on other amendments; it is not my place to do that. I just point out to the Minister, who mentioned the NPPF and the question in relation to my Amendment 240 on whether we should rely on the new NPPFs, that I said in my opening remarks that the current one mentions local cycling and walking infrastructure plans only very briefly and does not mention right of way improvement plans at all. We will need to look very carefully at what the Minister said in her helpful response and decide whether we bring back something different on Report.
I cannot resist one last comment on the speed limit issues. Once we all have electronic self-driving cars, it can all be changed anywhere at the click of a mouse—if we believe that will ever happen.
On that basis, I beg leave to withdraw the amendment.
“Meaning of “affordable housing”: affordable rent(1) In Annex 2 of the National Planning Policy Framework (glossary), in paragraph (a) of the definition of “affordable housing” (affordable housing for rent) omit “or Affordable Rent, or is at least 20% below local market rents (including service charges where applicable)”.(2) As soon as reasonably practicable and within two months of this Act being passed, the Secretary of State must publish a revised version of the National Planning Policy Framework, replacing the Affordable Housing for Rent definition with one based on incomes not market rates.”
Baroness Taylor of Stevenage (Lab)
My Lords, in moving Amendment 241A, I shall speak also to my Amendment 500 and comment on other amendments in this group.
I should declare from the outset that social housing is a topic very close to my heart. As a new-town child, when I was growing up, more than 30,000 of the 38,000 homes in my town were built and managed by the development corporation and later taken over by the council. Almost everyone I knew lived in a council home. They had been built in self-contained neighbourhoods with large amounts of green space, schools, health facilities, shops and so on all within a 10-minute walk. They were mostly two, three and four-bedroom family houses with gardens. Sadly, as land values have increased, that type of development is all too scarce.
As noble Lords will be aware, the introduction of right to buy not only took a scythe to housing stocks but, particularly in the new towns, disrupted the community cohesion brought about by shared housing tenure. Those 30,000 homes that I mentioned earlier have reduced to just over 8,000 now. The figure for the UK is that there are around 1.5 million fewer council homes now than in 1980. Councillors’ inboxes are full—permanently—of housing cases. Surely the generations who benefited from right to buy cannot just pull up the ladder behind them. From the experience of my councillor surgeries, they had not anticipated the impact on their children and grandchildren, never mind all the other young people for whom private renting, let along buying homes, is fast disappearing over their financial horizon.
Just yesterday, we had a shocking report from the National Housing Federation, setting out the impact of overcrowding, particularly on the life opportunities of young people. The findings of its report say that more than 300,000 children in England have to share beds with other family members. Some 2 million children live in cramped conditions with little or no personal space. Ethnic minority households are three times more likely to be overcrowded than white households. More than one-quarter of the parents living in overcrowded homes who were questioned by researchers said that they regularly had to sleep in a living room, bathroom, hallway or kitchen.
The family featured in the National Housing Federation press release, Joanna and her daughter Deni, were forced to seek council help when private rented accommodation became too expensive. Joanna had never been able to afford a two-bedroom property but, with rents soaring, now struggles to afford a one-bedroom flat. Deni, a talented musical student who is on the Royal Opera House programme for promising singers, has shared a bed with her mother for the whole of her 10 years and spends school holidays sitting on that bed while her mother works from home.
My own casework contains hundreds of housing cases a year, around 70% of which relate to homelessness, overcrowding or affordability. Shelter, which does such magnificent work in this area, held an independent commission which pointed out that we have lost 1.5 million social homes since 1980 and recommended that government rediscover publicly built housing as a key pillar of our national infrastructure by building 3.1 million new social homes over the next 20 years. That is a very ambitious target, especially when we note that only 6,463 more social homes were built last year, and 500 of those were by my local authority. After the Second World War, local authorities built more than 126,000 social homes a year. The biggest barriers are land and funding. Shelter, IPPR, CPRE, National Housing Federation, Onward and Create Streets all call for reform of the Land Compensation Act 1961, so that landowners are paid a fair price for their land without hope value. We will discuss this when we come to future amendments. Local government has also argued for many years that we should retain 100% of our right-to-buy receipts. We welcome recent developments on that front but, had it happened decades ago, we would not have seen the catastrophic impact on housing stock levels.
The Resolution Foundation’s Housing Outlook report for the first quarter of 2023 stated that, although mortgagors had been affected by rising interest rates,
“private and social renters are much more likely to report falling behind or struggling with their housing costs”.
It also said that,
“worryingly high numbers of … renters report signs of material deprivation and are resorting to sometimes unsustainable strategies to manage their housing costs”.
They include borrowing money, using savings or not heating their homes. The ONS deems rental properties affordable if a household does not spend more than 30% of its income on rent. In this country, only the east Midlands and the north-west had rent prices affordable to those in the lower quartile of household income.
There are also key financial drivers to the provision of social rented homes. First, the rent paid by social renters is recirculated to improve stock, build new homes, develop specialist housing and so on. This is sometimes the case with good private landlords, but not always. Secondly, it makes no sense to subsidise higher private rents through the benefits systems. A rapid increase in social housing stock would generate savings, as there are stark contrasts in rent levels. The figures for my area are indeed stark, with social rent for a two-bedroom property at £110 a week and private rent at £235. The local housing allowance is just £195. The amount that councils spend on temporary accommodation has increased by 71% in the past five years and now costs more than £1 billion a year.
I hope that I have set out clearly the issues and the impact that housing supply is having on the affordability of housing. My Amendment 241A is included to remove from the NPPF the spurious term “affordable housing” from rented properties that are 20% below market rent. In many areas, that would be far from affordable. For many families on low incomes, the only affordable housing is social rented housing.
Amendment 242, in the names of the noble Lord, Lord Stunell, and the noble Baroness, Lady Thornhill, and Amendment 242ZA, in the names of the noble Lord, Lord Stunell, and the noble Baroness, Lady Pinnock, attempt a comprehensive redefinition of the term “affordable home” to ensure that there is a link between median incomes and the definition of affordable homes, with that definition then enshrined in regulations. We support this proposal in principle and would want to work with the sector to ensure that there is a much more meaningful definition included in legislation and in the National Planning Policy Framework.
Amendment 262 in the name of the noble Baroness, Lady Pinnock, highlights the specific issues of affordable housing in national parks and areas of outstanding natural beauty. The issues around these were clearly elucidated by my noble friend Lady Hayman yesterday—I am sorry, on Tuesday. The weeks go by with this Bill, I am afraid. She quoted the former chair of National Parks England, Carl Lis, who warned that young people and national park staff are being forced out of their communities, in part by the high prices driven by exclusive holiday homes. She also referred to a statement by the Secretary of State in the other place on 21 March in which he pledged planning changes to the Bill to ensure that restrictions would be put in place on conversions of homes to Airbnbs. Failure to act on this important issue will see the continued decimation of communities in our most precious landscapes, as increasing numbers of homes are bought for second homes and converted to Airbnb use. Local councils must be able to use the planning system in the best interests of their communities. I hope that this amendment and that submitted by my noble friend on Tuesday, or a version of them, will be accepted to achieve the Secretary of State’s aim.
Amendment 286 in the name of the noble Baroness, Lady Pinnock, suggests bringing forward the requirements of the future homes standard to June 2023. In view of the protracted progress on the Bill through your Lordships’ House, this may prove a tad ambitious, although, of course, we hope that these can be implemented as quickly as possible. The second part of this amendment would grant powers to local authorities to determine for themselves what percentage of affordable homes is needed. We absolutely accept this in terms of devolution principles, but I just echo my noble friend Lady Hayman’s comments on Tuesday that, although we must be serious about meeting the affordable housing need, we also need to consider that communities need mixed tenures in housing.
We support Amendment 438 in the names of the noble Lords, Lord Best and Lord Shipley. I remember the absolute horror with which the original announcement of this measure was greeted by my colleagues in local government in 2012. Some London boroughs rightly pointed out that every property in their housing stock would exceed the threshold. We welcome the fact that the Government have already committed that they will scrap this policy, so perhaps incorporating this amendment is a quick and easy way to do so.
Lastly, I turn to my Amendment 500. Mission 10 in the White Paper is the key mission relating to housing. While its ambition in terms of improving the quality of rented property is admirable, in other ways it looks at housing through the wrong end of the lens: it sees levelling up only through the point of view of property ownership. For millions of people on housing waiting lists, in temporary accommodation, sleeping on their friends’ sofas or, as in a case I dealt with yesterday, having to conduct access visits with their children in their car because they have nowhere to live, the prospect of a safe, sustainable home with a secure social housing tenancy would meet their immediate aspirations of levelling up. That is why we hope the Government will recognise the absolute importance and value of social housing and use the opportunity of the Bill to commit to building the numbers we need. I beg to move.
The Lord Bishop of Leeds
My Lords, I shall speak in support of Amendment 242 in the name of the noble Lord, Lord Stunell. I do so having consulted the Bishop of Chelmsford, who leads for the Church of England on housing but is unable to be here today. It is clear, I think, that we need to rethink what genuinely affordable housing is and how an adequate supply can be delivered. In London, the south-east and many other areas across the country, the current affordable housing for rent definition of 20% below market rates makes little difference to those on a median income, let alone those in most need. Without redefinition, we will continue to work under the illusion that homes classed as affordable are helping to solve the housing affordability crisis, when for the most part they are not.
Of course, we need a multifaceted approach to solve the lack of affordable homes. I was interested to learn from the Bishop of Chelmsford that Vicky Ford MP has been addressing this in relation to Chelmsford. During her 10-minute rule Bill debate on 22 February, she spoke to the shortage of affordable housing we face locally and nationally. Her Affordable Housing (Conversion of Commercial Property) Bill would apply affordable housing obligations to conversions of commercial property to residential occupancy. The Bill is due its Second Reading in the Commons on 26 May, and we certainly hope that it will make some progress.
Lord Stunell (LD)
My Lords, I am very pleased that I chose to give way to the right reverend prelate the Bishop of Leeds, because he has done a superb job in introducing the amendment in my name, and I thank him very much for that. Perhaps I can just step back and look at the group that we are debating as a whole. There are five different approaches from the different amendments, which are all tackling the same problem. They approach it in different ways, but they are all aiming at a common destination. I will say to the Minister that it would be a mistake for her to simply play off the five different amendments and assume that there is no consensus and that this can simply be dismissed. They are all aimed at correcting the same fundamental policy mistake, which is to assume that the current formulation of the words “affordable homes” actually means affordable homes. It does not. It does not mean that, either in the private rented sector or the private ownership sector.
The highly desirable provision of affordable homes is supposed to be delivered through the planning obligations placed on developers when planning permission is granted. The calculation of that affordability is currently based on 80% of the market sale price of that property on that site or, alternatively, 80% of the market rent which is applicable in that general locality. Now the reality is that in many parts of England, especially but not only in London, taking 20% off either the market price or the rental price, while it does make it cheaper, does not make it affordable to those in the most local housing need.
My noble friend Lord Foster provided me with a typical case that illustrates this rather dramatically. It relates to Southwold in east Suffolk, where there are significant housing problems—for instance, last month, 31 homeless families applied to occupy one vacant rental property. So, there is absolutely no shortage of demand; it is a rural area 100 miles away from London. There is a terrible shortage of supply, despite the availability of so-called “affordable homes” achieved as a result of a planning agreement. One such so-called affordable shared ownership property in Southwold has been on the market for two years, during which time there have been no eligible local people able to afford to take it on. Local incomes are simply not high enough. That unaffordable home is on a redeveloped former hospital site where more than £1 million of public money has been contributed to “prioritise housing for local people”. Now, because there has been no eligible buyer, that home is going on the open market. That is a tragic lost opportunity to provide a home to meet local need; and, of course, it is a pitiful waste of public money.
In most London boroughs, affordable homes are not in reach unless you have two professional incomes at the household’s disposal. If Ministers doubt that, I suggest that they might like to ask the civil servants sitting in the Box behind them about their housing circumstances. Young professionals in London are squeezed out of the purchasing market and in grave difficulty even in the renting market. Those two London professionals who put their incomes together will perhaps be able to buy a house at a discounted price. That is good, but it is not a solution to London’s housing crisis. In Southwold and many other areas of the country, neither professional employment nor the bank of mum and dad can bridge the gap between real life and the policy intentions of “affordable homes”.
The five amendments in this group on this topic all start from the premise that affordability has real meaning only if it is based on income levels and not on the market or capital value of the home. Amendment 242 in my name and that of my noble friend Lady Thornhill was the first to appear on the Order Paper, but I concede that it is not necessarily the best option for the Minister, because it sets out a simple way of calculating affordability and might perhaps be best described as a statutory instrument rather than an approach to go in a Bill. But what we have is a formula that is based on existing databases for homes for sale, rent and shared ownership. That calculation is focused on local housing allowance figures for renters and for purchasers of median household income. We do not need a royal commission to consider these matters, nor indeed does the ONS need to devise a new way of measuring things. Everything is there, so the Minister could just get on with it.
I very much welcome the support of the right reverend Prelate the Bishop of Chelmsford, with whom I had discussions beforehand, and now of the right reverend Prelate the Bishop of Leeds, for my Amendment 242, but I recognise that such a specific amendment might in itself be controversial. Therefore, my noble friend Lady Pinnock and I also tabled Amendment 242ZA, which puts the same proposition in the court of the Minister or the Secretary of State to write the regulations rather than us doing it for him. I do not need to spend too much time advocating for either of these or commenting on the other options in the group. All are aimed at a complete reset of the affordability policy as it stands in the NPPF, so that homes set aside under that policy in future are affordable for those in housing need.
However, I need to spend a short time underlining that there are at least two parallel affordability bottlenecks. The first, which my Southwold example highlights, is the bottleneck—almost the deceit—caused by the assumption that a home sold at 80% of its market price is likely to be affordable to those in most housing need. It is true that such homes bring a new slice of first-time buyers into the market, but in many places they will be people with substantial incomes, a long way above those referred to by the right reverend Prelate and so eloquently by the noble Baroness, Lady Taylor of Stevenage.
Providing them through the planning system as affordable homes misleadingly implies—sometimes it is explicitly said—that it is a significant move towards tackling and reducing housing need for those in most hardship. That is simply not true. The recalibration we seek in my two amendments is to put that right and bring all such homes within reach of any household at or above the median income for that area. My noble friend Lord Foster tells me that, in Southwold, the affordability ratio is currently 17:1. That is outrageous. What happens to the affordability ratio if you take 20% off the price? It becomes 13:1. That does not make it affordable. Affordability defined like that is simply a poor joke.
The second bottleneck is the provision of an affordable home for households whose income is below the median and for whom a house purchase is completely out of sight. Such a household will by default be in the formal or, increasingly, the informal rented sector, as the noble Baroness, Lady Taylor, powerfully illustrated. There is sloppy talk about affordable homes being provided for rent within schemes of development which are far removed from the reality of people’s lives and their ability to pay. As a side note, half of the council homes sold are now back in the private rented sector—it is officially known that half of all the sold social homes have been transferred to the private rented sector, where the average rent is approximately double what it would be. You have terraces with a mixture of former council homes and those that remain social homes where the rent paid can be different by a factor of two, depending on whether it is a sold home or not.
My two amendments offer a solution by setting out clearly what is to be regarded as affordable rent when evaluating developments that purport to provide such accommodation. If adopted, the claims by some developers about their provision of “affordable” units would be weeded out and more genuinely affordable homes for rent would enter the market. For the third category of shared ownership, we recognise that a hybrid calculation of affordability will be required, and we have outlined how it might be done.
However, this is not about the minutiae of particular schemes; it is about recognising and then doing something about turning the hollow words of affordability calculated on house prices into a meaningful policy based on households’ ability to pay. If Ministers accept that basic principle and reshape the existing schemes to make affordable homes affordable, based on income, I am sure that all noble Lords with amendments down would be only too ready to work with them to get the small print right and dot the “i”s and cross the “t”s. Pending that important step, I will keep my Amendment 242.
The Lord Bishop of Leeds
My Lords, before the noble Lord takes his seat, may I apologise for jumping the gun? Before he had been able to speak to his own amendment, there was a silence and, like nature, I abhorred a vacuum, but I do apologise.
Lord Stunell (LD)
I think the spirit moved. It is good the right reverend Prelate spoke first in this case.
Lord Best (CB)
My Lords, I rise to speak particularly to my Amendment 438, but I will preface my remarks by saying how much I have appreciated this debate and the contributions from the noble Baroness, Lady Taylor of Stevenage, the noble Lord, Lord Stunell, and the right reverend Prelate the Bishop of Leeds. We have explored this issue in a comprehensive and useful way, and I greatly appreciate that.
I draw noble Lords’ attention to the Affordable Housing Commission report, which came out in the middle of Covid and was therefore buried and forgotten by everybody. The AHC report, which noble Lords can find via Google or their favourite search engine, was a pretty big effort, thankfully funded fully by the Nationwide Foundation—the Nationwide Building Society’s foundation—with a secretariat from the Smith Institute; I had the honour of chairing this. The report is a pretty meaty document and worth those who are interested in this subject following through, but that was a great debate on those amendments, and I support the essence of all of them.
My amendment 438, to which the noble Lord, Lord Shipley, has kindly added his name, seeks to remove from the statute book an obnoxious, offensive legislative measure which has hung over local authorities since the passing of the Housing and Planning Act 2016. I reiterate my declaration of interest as a vice-president of the Local Government Association. Back in 2016, I was the LGA president and along with allies from all parts of the House, including the noble Lord, Lord Porter, with his local government expertise, and the noble Lord, Lord Kerslake, we fought—unsuccessfully—to remove these awful sections from the 2016 Act.
What does this part of the Housing and Planning Act 2016 say, and why is it so troublesome? The key section imposes obligations on local authorities to sell their most valuable council housing when tenants move out, rather than reletting the property. It does so by requiring local authorities to pay a levy to the Secretary of State equivalent to the market value of the best council housing when it becomes vacant, multiplied by the estimated number of vacancies for the next year. To raise the money to pay this levy, local authorities would obviously have no option but to sell their most valuable homes. Most of the proceeds from these compulsory sales go straight to the Secretary of State, who, in a convoluted twist, would use the money to compensate housing associations for selling properties at large discounts to their tenants under an extension of the right to buy.
The effect of this extraordinary measure, had it ever been implemented, would have been highly damaging both for local authorities trying to meet the acute need for social housing in their areas and for the families desperately waiting for a home. Council housing would be further stigmatised and labelled as only for those with no hope of anything better, and with fewer re-lets, pressure on the remaining council stock would be even more intense than it already is.
Buyers of the housing which councils would be forced to sell would very often be private landlords who would let to similar occupiers but would charge market rents, thereby imposing twice the burden on the Exchequer for tenants in receipt of benefits. I was glad to catch up with the latest statistic from the noble Lord, Lord Stunell: that 50% of properties sold under the right to buy have been moved into the hands of private landlords and, obviously, let at rents that are twice as much, if not more.
To add insult to injury, the 2016 Act also empowered the Secretary of State to top up this raid on council resources by requiring local authorities to raise the rents to market levels for any tenant foolish enough to increase their income above a fixed level. The extra rent would not go towards management and maintenance of council housing but instead would be remitted to the Secretary of State as a windfall for the Government.
I moved an amendment opposing the measure and it was carried by a huge majority in this House. I even featured on the BBC documentary on the work of the House of Lords. Although it remains in law, it is another ingredient in the 2016 Act that thankfully has not seen the light of day.
Returning to the compulsory sales of higher-value council housing, as is addressed by the amendment, we can now see what a disaster this would have been—but the offending measure remains on the statute book. In reality, this sword of Damocles hanging over councils is no longer a major threat since Government Ministers have made it clear that they have no intention of using these draconian asset-stripping powers. Indeed, I am confident that Ministers understand the imperative for more, not less, social housing provision.
It was, no doubt, the work of an enthusiastic but naive special adviser coming up with a cunning wheeze to extract the cost from local authorities of securing new right-to-buy sales by housing associations. Today there would be little appetite for such shenanigans which would reduce the stock of available social housing, following the right to buy’s removal of 2.8 million council homes and the subsequent higher costs of using the private rented sector instead. Indeed, the right to buy has now been abolished in Scotland, and Wales is following suit.
Councils have welcomed the Government’s recent move enabling them to retain 100% of right-to-buy receipts for 2022-23 and 2023-24. With long waiting lists for social housing and the private sector becoming more and more unfeasible for many households, that announcement should support councils trying to replace the homes sold through right to buy. It would be helpful if the Government completed this change and made it permanent rather than just for two years. On this theme, I hope that the Government will finally agree to councils having the ability to set right-to-buy discounts locally as part of the Bill’s emphasis on devolution.
The time has surely come to be rid of this 2016 misguided measure to strip local authorities of their best housing assets. The LGA and others have been waiting for a legislative opportunity for the Government to enact their clear intention to have nothing to do with this defunct legislative device. The Bill provides that opportunity, and I think everyone in local government and in the world of social housing will breathe a sigh of relief to see this expunged from the statute book. I commend this amendment.
Lord Young of Cookham (Con)
My Lords, I wish to intervene briefly to put this debate in an important context. Before I do so, I commend the noble Lord, Lord Best, on eventually achieving the victory which he sought when the 2016 Act was going through; it was not the best piece of legislation on housing that Parliament has seen. I agree with what the right reverend Prelate said—that we should unfreeze the local housing allowance or, if we cannot, increase the discretionary housing grant, to enable those who find that they cannot meet the rent to have more support.
I also agree with the noble Lord, Lord Stunell, that “affordable” is a misnomer, but there is a fundamental choice that we have to make, which is: the higher the rents, the more social houses you can build; and the lower the rents, the fewer social houses you can build. That is simply because of the way that social landlords are funded. A Government decide to have a capital fund available for new builds. A Government of a different persuasion may have a higher figure than the current one but, whatever that figure, the number of houses that can be built is dependent on the rent levels which the social landlords can charge.
A Housing Minister has a choice: you can have lower rents, social rents or genuinely affordable rents, but you will get less output. When I had responsibility and was faced with this spectrum, I went for slightly more output but slightly higher rents, to meet the demand for new houses and to build more houses that would last 60 years. I recognise that others may choose to go the other way on the spectrum, but you cannot get away from the fact that this is the choice. If you want to have affordable rents reduced to social rents, the consequence is that you will have fewer houses. I make this intervention at the end of this debate just to put it in a slightly broader context.
Baroness Pinnock (LD)
My Lords, I have two amendments in my name that I wish to speak to briefly. However, prior to that, I say that my noble friend Lord Stunell made an important point about how all the amendments here are trying to resolve the issue of what is affordable. So-called affordable homes are those built by the commercial sector as part of a development—a planning obligation—yet the challenge for us all is to provide homes at a social rent, which is roughly estimated as 50% of the market rent.
It is a tragedy for this country that successive Governments seem to have abandoned provision of homes for social rent in any large numbers. Local authorities have been severely constrained in building their own social housing, and the provision of homes for social rent has largely been left to housing associations. We then come to the conundrum which the noble Lord, Lord Young of Cookham, just rightly pointed to—that the capital that housing associations receive from government depends on their flow of rental income. Therefore, do you have more or less? Either way, everybody agrees that there are insufficient homes for social rent.
About 30 years ago, my authority had 42,000 council houses at social rent—it now has 21,000. That is the scale of what has happened. Indeed, my noble friend Lord Stunell is absolutely right that about half of them are now back in the market as private rented properties at a higher rent for folk but without any of the support packages provided for homes for social housing rent within either a local authority or a housing association. That is a huge challenge that this country needs to tackle. One of the key factors in levelling up is a decent home—it is in the levelling-up missions. Millions of people in our country do not live in an adequate, safe home appropriate for their family, and we need to address that scandal.
On affordability, my noble friend Lord Stunell expertly laid out the issues, and I do not wish to say anything, except that obviously I totally support him. I wish to raise one issue about affordability that is a bit of a side issue. It seems that any property built as part of a commercial development which is deemed affordable should be affordable in perpetuity. My own council adopted that policy—I have to say as a result of pressure from my own party there—so that, when the house is bought, the 80% factor remains. The least the Government could do is to include that as part of a definition of affordability.
Lord Thurlow (CB)
My Lords, before we conclude this group, I start by saying that I do not know how any Government with a social conscience could listen to our debate for the last couple of hours without feeling an urgent desire to scrap the right to buy.
I support Amendment 438 in the name of the noble Lord, Lord Best, concerning the sale of higher-value council residential properties. We must not forget that a lot of them are very old, they may have a lot of bedrooms, and they may be under-occupied, as we understand it, and very expensive to maintain—all good reasons for selling them. But we have a chronic shortage of housing. We all know that; we have heard it repeatedly today. If you geometrically increase that to the chronic shortage of social housing, or affordable housing, it is a crisis. The proceeds of all council residential property sales should be reinvested into social housing and affordable housing. They are not, as we have heard again and again. The failure to replace the units lost by the right to buy—the noble Lord, Lord Stunell, referred to it very eloquently—is a disgrace.
The private developers, who build large numbers of residential units for private sale are under an obligation to provide an allocation under the Section 106 agreements for affordable housing, but this is abused by developers—everyone in the industry knows that. The affordable housing obligation is subject to something called a financial viability appraisal. The bigger developers are frequently huge, multi-million-pound public companies; they have the resources, expertise and firepower to employ legal advisers at the highest and most expensive level to provide the financial viability assessment that suits their purposes. There is no possibility of local authorities being able to take on this challenge, partly because they would have to do it so frequently, and partly because they are short of funds in the first place and hardly able to challenge planning applications even on a private level from time to time. I am afraid that there is very little likelihood of the numbers of social or affordable housing being increased in the short-term. I conclude that—
Lord Stunell (LD)
I thank the noble Lord for giving way. Does he agree that a compounding factor is that the calculations of viability studies are kept secret and that, if they were more transparently available, some of the abuse that he quite rightly refers to would be reduced?
Lord Thurlow (CB)
I thank the noble Lord for his comment. I agree entirely with what he says. Without being able to challenge line-by-line a financial viability appraisal, it becomes an impossible task. A lot of the elements of financial appraisals are subjective, and value is therefore very much in the eye of the beholder. I absolutely agree with the noble Lord’s comment. However, until developers are required to provide sufficient social housing, together with the contribution from government sources, I unconditionally support the amendment tabled by the noble Lord, Lord Best.
The Parliamentary Under-Secretary of State, Department for Levellin Up, Housing & Communities (Baroness Scott of Bybrook) (Con)
My Lords, I thank my noble friend Lord Young of Cookham for his explanation of the difficult decisions that social landlords must navigate through with the competing requirements on their rental amounts. That is really important; it is not just about building other properties—there are many other pressures that we continue to put upon them.
Amendment 241A, and Amendments 242 and 242ZA, tabled by the noble Lord, Lord Stunell, relate to the definition of affordable housing. It is right to raise the importance of ensuring that affordable housing meets the needs of those who require it. Before addressing the amendments specifically, I assure noble Lords that the Government recognise the need to increase the supply of the most affordable type of affordable housing—that is to say, let at social rent. That is reflected in our commitment in the levelling-up White Paper to increasing the amount of social housing available over time to provide the most affordable housing for those who need it. A large number of new houses to be delivered through our £11.5 billion affordable homes programme will be for social rent.
The consultation that we published before Christmas on the NPPF also recognised the need for more social rent homes. Subject to the outcome of that consultation, we are proposing to make changes to the NPPF to make it clear that local planning authorities should give greater importance in planning to social rent homes when addressing their overall housing requirements in their development plans and making planning decisions. However, we also recognise that local authorities need flexibility to deliver exactly what is needed in their area, and this may vary depending on local circumstances. We want to ensure that, when there is innovation in models for the delivery of much-needed housing to meet the needs of those who require it, we can flex the system to incorporate such innovation.
So, we are aiming for a “Goldilocks zone”. If we define affordable housing too strictly either within the Bill or the NPPF, we risk stripping local authorities of their flexibility to decide what is appropriate in their area. But, if we leave the definition of affordable housing entirely to local authorities, we risk losing the levers to drive important government ambitions, including those relating to the increased delivery of social rent. That is why we are keen to maintain the existing approach, in which the Government set the direction through policy and regulation, while also allowing space for local authorities to shape this approach to best meet local need.
It is for that reason that I am concerned that Amendments 241A, 242 and 242ZA, which are all concerned with linking the definition of affordable housing to a specific measure of income, would be too restrictive. In the National Planning Policy Framework, affordable housing is described as housing for sale or rent to those whose needs are not met by the market and which complies with one or more specific definitions. Those specific definitions encompass several different types of accommodation, to meet the housing needs of a range of people in different circumstances and housing markets.
This includes affordable rent as well as social rent homes. Affordable rent was introduced in 2011 to make it possible to deliver a larger number of affordable homes for a given amount of public investment. This has helped to support the delivery of over 632,600 affordable homes since 2010. Of that total, more than 440,000 were homes for rent and, of these, more than 162,000 were for social rent.
The definition in the National Planning Policy Framework, to be read alongside relevant Written Ministerial Statements and guidance, also encompasses a range of options, including shared ownership and First Homes, that offer routes into home ownership for households whose needs are not met by the market. These options are typically available at a price below market value. Eligibility can also be assessed in relation to overall household income, or in reference to local incomes and house prices.
In relation to shared ownership specifically, the Government understand the need to maximise the scheme’s affordability both at the initial point of purchase and over the longer term. That is why shared ownership is specifically designed to enable prospective buyers to purchase the right percentage share of their home for them, based on an affordability assessment conducted by an independent financial adviser. By linking shared ownership status as a form of affordable housing to a specific measure of income, we would be removing this much-needed flexibility to tailor the scheme to the individual circumstances of prospective buyers.
In relation to compulsory purchase orders and the community infrastructure levy—and its replacement, the infrastructure levy—the definition of affordable housing is linked to the definition of social housing in the Housing and Regeneration Act 2008. This definition encompasses both “low-cost rental accommodation” and “low-cost home ownership accommodation”. There is flexibility to add other descriptions of housing via regulations.
This ensures that regulations can then be amended so that definitions for the purposes of the community infrastructure fund can also be updated. This approach has been maintained in the Bill for those areas which touch on developer contributions: the infrastructure levy, street votes and community land auctions.
It is right to preserve this flexibility, alongside our proposal that national planning policy should place much greater value on homes for social rent. I therefore hope that the right reverend Prelate and the noble Lord, Lord Stunell, will not press their amendments.
I turn next to Amendments 262 and 500 in the names of the noble Baronesses, Lady Pinnock and Lady Taylor of Stevenage. These amendments seek to enable local authorities to mandate that new housing under their jurisdiction be affordable; to define “affordable” for that purpose; and to enable Ministers to set legally binding targets for the construction of social housing.
Lord Stunell (LD)
The Minister is being extremely thorough. She has emphasised very much that she does not want to constrain local authorities exercising their decisions as is appropriate for their area. Can she give us some assurance that when the NDMPs and the revised NPPF are published that we will not find that they are being constrained via a different route?
Baroness Scott of Bybrook (Con)
I cannot give that assurance because we have not yet published them, but from everything I know of where the Bill is going with planning, we are encouraging local authorities to make those local decisions within the national framework, and I do not expect any further constraints on local authorities in that regard.
This is probably the right time to also bring up the issue that the noble Lord, Lord Thurlow, raised about transparency and viability. We agree with many of the criticisms of the misuse of viability assessments. That is why we are introducing the infrastructure levy, which removes the need for viability assessments as part of the planning permission process. If we take it out of the process, I hope we will not have this argument in the beginning. I have had many arguments over viability in the past. If we take it out of the system, I hope that will stop in future.
Moving to Amendment 438, in the name of the noble Lord, Lord Best, I understand why he has put forward his amendments. While I appreciate totally the sentiment behind them, we do not believe this would be the correct legislative vehicle for this policy. The Government have provided public assurances that they will not require local authorities to make a payment in respect of their vacant higher value council homes in the social housing Green Paper and stand by that commitment. The Levelling Up and Regeneration Bill does not address the topic of social housing, and the Government do not wish further to complicate such a complex set of legislative measures. However, the Government remain committed to legislating on this issue at an appropriate time in the future. I can provide assurances at the Dispatch Box to the noble Lord that the provisions laid out in Chapter 2 of Part 4 of the Housing and Planning Act 2016 have not been brought into effect and this Government have no intention of doing so. The provisions lack a regulatory framework to underpin the policy, and therefore there is no risk of local authorities being subject to them before we are able to legislate in the future. I hope this reassures the noble Lord that the Government remain committed to the decisions set out in the social housing Green Paper and that provisions will be made in future for this revocation to be issued. I hope the noble Lord will feel able not to move the amendment.
Baroness Taylor of Stevenage (Lab)
I am grateful to noble Lords for such an interesting debate on a crucial topic central to the Levelling Up and Regeneration Bill. As a result of the discussions we have had, the National Housing Federation’s figure for people in need of social housing is now 3.8 million—that is 1.6 million households. That is around 500,000 more households than the 1.16 million that are on official waiting lists. We all know the reasons for that: not everybody who is in need of housing will necessarily want to spend the next 20 years on a housing waiting list. In so many areas it is impossible to see people ever being housed as a result of those housing lists.
I thank the right reverend Prelate the Bishop of Leeds for his important comments, particularly about us needing to understand what genuinely affordable housing means. It certainly does not mean the definition that is used in planning at the moment. I agree with his comment that we are under an illusion that housing built under the “affordable homes” category will resolve the housing crisis—it will not. I totally support his comments about unfreezing local housing allowance levels, which would be an important step. Over many decades, we have seen sticking-plaster approaches to tackling the housing situation in this country, which consequently continues to deteriorate.
The noble Lord, Lord Stunell, rightly said that all of the amendments in this group are aimed at the same destination. Neither in renting nor in homes for sale does “affordability” mean what it says on the tin. We are all trying to make sure that we do what we can in the Bill to change that to some extent.
It is misleading to say that the Help to Buy schemes, which the noble Lord, Lord Stunell, mentioned, will tackle the issue for those most in need of housing. Taking a little risk, I will mention a conversation I had with a former Conservative Minister, who said, “I don’t know why you keep banging on about social housing, Sharon. Everyone can afford to buy a house under our Help to Buy scheme”. That is clearly not the case. The noble Lord, Lord Stunell, quoted his noble friend who said that, in Southwold, the affordability ratio is 17:1, and 13:1 after a 20% discount. That is the case in quite a lot of the country, although not everywhere.
More than 50% of social homes have been transferred into the private rented sector, which is a great grievance to those of us who deal with the impact of that. Where that rent is paid by universal credit or other benefits, instead of DWP paying—I shall use the figures I quoted earlier—£110 a week rent for those properties, the public purse now pays £235 a week for them. That does not make any sense at all, so we need to do all we can to address this situation.
As ever, I was pleased to hear from the noble Lord, Lord Best, about his amendment. I thank him for reminding us about the Affordable Housing Commission report, which is very good and we all need to take account of it. I am afraid I found the Minister’s comments on the amendment proposed by the noble Lord, Lord Best, a bit disappointing. None of us, including the Government, want this measure. The noble Lord, Lord Best, called it an “obnoxious” and “offensive” legislative provision, which it is. He pointed out that it has hung over local government since 2016. We could use this legislation to get rid of it. Why do we not do that? Under that legislation, local authorities were expected to raise the rent to market levels where tenants improved their financial situation. When that happened, it greatly concerned me that this would not benefit local communities or our housing stock but would tip into the bottomless bucket in the Treasury. It is time that that provision was scrapped. I absolutely support the comments of the noble Lord, Lord Best, about local decisions being taken on right-to-buy discounts. That measure is way past time, and we should absolutely have it.
The noble Lord, Lord Young, spoke about unfreezing local housing allowance, which I agree with. He also mentioned discretionary housing payments. In many local authorities, the allocated amount of discretionary housing payment runs out in Quarter 1, and then various bodies, including government advisory bodies and Citizens Advice, often send tenants to their councils to request discretionary housing payment, when in fact it has run out in the first three months of the year. That is simply because of the cost of living crisis and the level of rents that are putting so much pressure on those discretionary housing payments.
Baroness Scott of Bybrook
“Local Government Act 1972
A1 In section 138C of the Local Government Act 1972 (application of sections 138A and 138B to other authorities), in subsections (1)(s) and (2)(c), for “an order under section 29” substitute “regulations made under section 15J”.”Member's explanatory statement
This amendment inserts an amendment to the Local Government Act 1972 which is consequential upon Schedule 7 to the Bill.
“1A In section 2A (the Mayor of London: applications of potential strategic importance), in subsection (6)(aa), for “development plan document” substitute “local plan, document which is or forms part of a minerals and waste plan or supplementary plan”.1B In section 59A (development orders: permission in principle)—(a) in paragraph (b) of subsection (3)—(i) for “development plan document” substitute “local plan or supplementary plan”;(ii) for “section 37” substitute “section 15LH”;(b) after that paragraph insert—“(ba) a document which is, or forms part of, a minerals and waste plan within the meaning of Part 2 of the 2004 Act (“a minerals and waste plan document”);”(c) in subsection (5)(b), for “development plan document” substitute “local plan, minerals and waste plan document or supplementary plan”.1C In section 70(4) (determination of applications: definitions), in paragraph (l) of the definition of “relevant authority”, for “section 29” substitute “section 15J”. 1D In section 74 (directions etc as to method of dealing with applications), in subsection (1BB) for “development plan document” substitute “local plan, document which is or forms part of a minerals and waste plan or supplementary plan”.”Member's explanatory statement
This amendment inserts amendments to the Town and Country Planning Act 1990 which are consequential upon Schedule 7 to the Bill.
“2A In section 306 (contributions by local authorities and statutory undertakers), in subsection (2)(ab)—(a) after “by a” insert “minerals and waste planning authority or”;(b) after “duty of” insert “minerals and waste planning authority or”.2B In section 324 (rights of entry), in subsection (1)(a), for “local development document” substitute “local plan, document which is or forms part of a minerals and waste plan or supplementary plan”.”Member's explanatory statement
This amendment inserts amendments to the Town and Country Planning Act 1990 which are consequential upon Schedule 7 to the Bill.
“3A “(1) Schedule 1 (local planning authorities: distribution of functions) is amended as follows.(2) In paragraph 7, for sub-paragraph (10) substitute—“(10) A relevant county policy is a policy contained in a relevant document, plan or revision which—(a) has been submitted for independent examination under Part 2 of the 2004 Act and has not been withdrawn, or(b) has been adopted, approved or made for the purposes of that Part.(10A) In sub-paragraph (10)—(a) a “relevant document, plan or revision” means—(i) a document prepared to be, or to form part of, the county planning authority’s minerals and waste plan for the purposes of Part 2 of the 2004 Act,(ii) a revision of a document which is, or forms part of, the county planning authority’s minerals and waste plan for the purposes of that Part,(iii) a supplementary plan prepared by the county planning authority acting as a minerals and waste planning authority under that Part, or(iv) a revision of a such a supplementary plan;(b) the reference to submission of a relevant document, plan or revision for independent examination under Part 2 of the 2004 Act is to be taken to include any case where an independent examination is held under that Part.”(3) In paragraph 8(3E), in paragraph (b) of the definition of “relevant neighbourhood development plan”, for “(3)” substitute “(2A)”.(4) In paragraph 8A(2), in paragraph (b) of the definition of “relevant neighbourhood development plan”, for “(3)” substitute “(2A)”.3B In Schedule 13 (blighted land), in paragraph 1A—(a) for “development plan document”, in the first place it appears, substitute “local plan, minerals and waste plan or supplementary plan”;(b) for Note (2) substitute—“(2) For the purposes of this paragraph a local plan is a local plan, or revision of such a plan, which— (a) has been submitted for independent examination under Part 2 of the Planning and Compulsory Purchase Act 2004 (in this paragraph, “the 2004 Act”) and has not been withdrawn, or(b) has been adopted, approved or made for the purposes of that Part.(2ZA) For the purposes of this paragraph a minerals and waste plan is a document prepared to be or to form part of a minerals and waste plan, or a revision of such a document, which—(a) has been submitted for independent examination under Part 2 of the 2004 Act and has not been withdrawn, or(b) has been adopted, approved or made for the purposes of that Part.(2ZB) For the purposes of this paragraph a supplementary plan is a supplementary plan, or a revision of such a plan, which—(a) has been submitted for independent examination under Part 2 of the 2004 Act and has not been withdrawn, or(b) has been adopted, approved or made for the purposes of that Part.”;(c) omit Note (3);(d) for Note (4) substitute—“(4) In Notes (2) to (2ZB) the references to submission of a local plan, a supplementary plan, a document or a revision for independent examination under Part 2 of the 2004 Act are to be taken to include any case where an independent examination is held under that Part.””Member's explanatory statement
This amendment inserts amendments to the Town and Country Planning Act 1990 which are consequential upon Schedule 7 to the Bill.
“3A GLAA 1999 is amended as follows.”Member's explanatory statement
This amendment is consequential upon the sixth amendment in the Minister’s name to Schedule 8 to the Bill.
Member's explanatory statement
This amendment is consequential upon the seventh amendment in the Minister’s name to Schedule 8 to the Bill.
“4A In section 346 (monitoring and data collection), in paragraph (b), for “local development documents” substitute “local plan, any document which is or forms part of a minerals and waste plan and any supplementary plans”.4B In section 347 (functional bodies to have regard to strategy)—(a) for “section 24” substitute “sections 15CA(2) and 15CC(7)”;(b) for “requires certain of a Mayoral development corporation’s documents” substitute “require local plans, minerals and waste plans and supplementary plans”.”Member's explanatory statement
This amendment inserts amendments to the Greater London Authority Act 1999 which are consequential upon Schedule 7 to the Bill.
“Commons Act 2006
15 In Schedule 1A to the Commons Act 2006 (exclusion of right under section 15 of that Act (registration of greens): England), in the Table—(a) in paragraph 3 of the first column—(i) for “development plan document” substitute “local plan, a document which is to be or to form part of a minerals and waste plan or a supplementary plan”;(ii) for “section 17(7)” substitute “section 15LE(2)(g)”;(b) in paragraph (a) of the entry in the second column corresponding to paragraph 3—(i) after “The” insert “plan or”;(ii) for “under section 22(1) of the 2004 Act” substitute “under—(i) in the case of a local plan, section 15E of the 2004 Act;(ii) in the case of a document which is to be or to form part of a minerals and waste plan, section 15E of that Act (as applied by section 15CB(7) of that Act);(iii) in the case of a supplementary plan, regulations made under section 15CC(11) of that Act.”(c) for paragraph (b) of the entry in the second column corresponding to paragraph 3 substitute—“(b) The plan or document is adopted or approved under Part 2 of that Act (but see paragraph 4 of this Table).”;(d) in paragraph (c) of the entry in the second column corresponding to paragraph 3, after “which the” insert “plan or”;(e) for paragraph 4 of the first column substitute—“4 A local plan, a document which is or forms part of a minerals and waste plan or a supplementary plan, which identifies the land for potential development, is adopted or approved under Part 2 of the 2004 Act.”;(f) in paragraph (a) of the entry in the second column corresponding to paragraph 4—(i) after “The” insert “plan or”;(ii) for “section 25 of the 2004 Act” substitute “section 15G of the 2004 Act (including as applied by section 15CB(7) of that Act, in the case of a minerals and waste plan)”;(g) in paragraph (b) of the entry in the second column corresponding to paragraph 4, after “in the” insert “plan or”.Planning and Energy Act 2008
16 The Planning and Energy Act 2008 is amended as follows.17 (1) Section 1 (energy policies) is amended as follows.(2) In subsection (1), for “development plan documents,” substitute “local plan and any supplementary plan, a minerals and waste planning authority may in their minerals and waste plan and any supplementary plan,”.(3) After that subsection insert—“(1ZA) In relation to the minerals and waste plan or supplementary plan of a minerals and waste planning authority, references in subsection (1) to development in their area are to minerals and waste development in the relevant area.”(4) In subsection (4)—(a) in paragraph (a), for “section 19” substitute “sections 15C, 15CA and 15CC”;(b) after that paragraph insert—“(aza) sections 15CB and 15CC of that Act, in the case of a minerals and waste planning authority;” (5) In subsection (5), for “development plan documents” substitute “a local plan, a minerals and waste plan or a supplementary plan”.18 In section 2 (interpretation), for the definition of “development plan document” substitute—““local plan” , “minerals and waste development”, “minerals and waste plan”, “minerals and waste planning authority”, “relevant area” and “supplementary plan” have the same meaning as in Part 2 of the Planning and Compulsory Purchase Act 2004 (see, in particular, section 15LH of that Act);”Marine and Coastal Access Act 2009
19 (1) Schedule 6 to the Marine and Coastal Access Act 2009 (marine plans: preparation and adoption) is amended as follows.(2) In paragraph 1—(a) in sub-paragraph (2), after paragraph (d) insert—“(da) any minerals and waste planning authority whose relevant area adjoins or is adjacent to the marine plan area;”;(b) in sub-paragraph (3)—(i) in paragraph (a) of the definition of “local planning authority”, for “section 37” substitute “section 15LF”;(ii) after that definition insert—““minerals and waste planning authority” means an authority which is a minerals and waste planning authority for the purposes of Part 2 of the Planning and Compulsory Purchase Act 2004 (see section 15LG of that Act) and “relevant area” has the meaning given by that section.”(3) In paragraph 3(6), in paragraph (a) of the definition of “development plan”, for “section 38(2) to (4)” substitute “section 38(2A) to (4)”.Waste (England and Wales) Regulations 2011 (S.I. 2011/988)
20 In regulation 16(3) of the Waste (England and Wales) Regulations 2011 (general interpretation: meaning of planning authority), for sub-paragraph (b) substitute—“(ba) a local planning authority or minerals and waste planning authority for the purposes of Part 2 of the 2004 Act;”.Housing and Planning Act 2016
21 The Housing and Planning Act 2016 is amended as follows.22 In section 6 (starter homes: monitoring), in subsection (2), omit paragraph (c).23 In section 7 (starter homes: compliance directions), in subsection (1)(b) for “local development document” substitute “local plan, document which is or forms part of a minerals and waste plan or supplementary plan”.24 In section 8 (starter homes: interpretation), for the definition of “local development document” substitute—““local plan” , “minerals and waste plan” and “supplementary plan” have the same meaning as in Part 2 of the Planning and Compulsory Purchase Act 2004 (see, in particular, section 15LH of that Act);”Conservation of Habitats and Species Regulations 2017 (S.I. 2017/1012)
25 The Conservation of Habitats and Species Regulations 2017 are amended as follows.26 (1) Regulation 41 (nature conservation policy in planning contexts) is amended as follows.(2) In paragraph (1), after “of land” insert “or minerals and waste development”. (3) In paragraph (2)(a)(i)—(a) for “section 17(3)” substitute “sections 15C(3) and (4) and 15CC(3)”;(b) for “local development documents” substitute “local plans and supplementary plans made by local planning authorities”.(4) Omit the “and” at the end of paragraph (2)(a)(ii).(5) After paragraph (2)(a) insert—“(aa) in relation to minerals and waste development, sections 15CB(2) and (3) and 15CC(5) of that Act; and”27 (1) Regulation 108 (co-ordination for land use plan prepared by more than one authority) is amended as follows.(2) In paragraph (1), for the words from “prepare” to the end substitute “prepare a relevant joint plan”.(3) In paragraph (2), for “joint local development document or plan” substitute “relevant joint plan”.(4) In paragraph (3), for “joint local planning document or plan” substitute “relevant joint plan”.(5) In paragraph (5), for “joint local development document or plan” substitute “relevant joint plan”.(6) After that paragraph insert—“(6) In this regulation “relevant joint plan” means—(a) a joint spatial development strategy, joint local plan or joint supplementary plan (within the meaning of Part 2 of the 2004 Planning Act),(b) a document which is or forms part of a joint minerals and waste plan under sections 15I and 15IA of that Act (as applied by section 15CB(7) of that Act), or(c) a joint local development plan under section 72 of that Act.”28 (1) Regulation 111 (interpretation of Chapter 8 of Part 6) is amended as follows.(2) In paragraph (1)—(a) in paragraph (b) of the definition of “land use plan”—(i) for “local development document as provided for in” substitute “joint spatial development strategy, local plan, document which is or forms part of a minerals and waste plan, supplementary plan or any revision of such a plan or document under”;(ii) omit the words from “other” to the end;(b) in paragraph (a) of the definition of “plan-making authority”, after “replacement)” insert “or section 15CC of the 2004 Planning Act (supplementary plans)”;(c) in paragraph (b) of the definition of “plan-making authority” omit “or an order under section 29(2) of the 2004 Planning Act (joint committees)”;(d) after that paragraph insert—“(ba) a local planning authority or minerals and waste planning authority for the purposes of Part 2 of the 2004 Planning Act;”;(e) in paragraph (c) of the definition of “plan-making authority”, omit sub-paragraph (i);(f) after that paragraph insert—“(ca) anyone exercising powers under section 15H, 15HA or 15HB of, or Schedule A1 to, the 2004 Planning Act;”(3) In paragraph (2)—(a) for sub-paragraphs (a) and (b) substitute— “(aa) the adoption of a joint spatial development strategy under section 15AD of the 2004 Planning Act or of an alteration of such a strategy under section 15AF of that Act;(ab) the adoption or approval of a local plan, document which is or forms part of a minerals and waste plan, supplementary plan or a revision of any such document or plan under Part 2 of the 2004 Planning Act;”;(b) in sub-paragraph (c) for “publication” substitute “adoption”.”Member's explanatory statement
This amendment inserts amendments to various enactments which are consequential upon Schedule 7 to the Bill.
Baroness Hayman of Ullock
“(5) The Secretary of State must, within one year of the day on which this section comes into force, publish a report of a review of the efficacy of Local Heritage Lists and the resources local authorities have to produce them.(6) The Secretary of State must, on the day on which this section comes into force, publish the results of the 2018 review of the non-statutory guidance on Assets of Community Value.”Member's explanatory statement
This means that the Secretary of State must publish a report of a review of Local Heritage Lists and the results of the 2018 review of the non-statutory guidance on Assets of Community Value.
Baroness Hayman of Ullock (Lab)
My Lords, Amendment 243 is in the name of my noble friend Lady Taylor of Stevenage. Amendments 244 and 246 in this group are both also in her name. I shall briefly speak to them and make some comments on some of the other amendments in this group.
My noble friend’s Amendment 243 asks the Secretary of State to
“publish a report of a review of Local Heritage Lists and the results of the 2018 review of the non-statutory guidance on Assets of Community Value”.
Amendment 246 also refers to assets of community value—ACVs—asking for draft legislation to be published to reform the processes.
Amendment 244, which is on a slightly separate issue, is about decision-making on temporary stop notices. The amendment says that, when making a decision on the correct recipient of a temporary stop notice, the authority should have regard to the tenancy status of the occupier and their level of responsibility for any works on the property. It is pretty straightforward as to why we have laid this amendment, so I shall be brief. We believe it is really important to guard against a situation where the wrong person may be held accountable for works on a property for which they actually have no responsibility whatever. The Local Government Association was very clear that we should make this point during the debate on the Bill. We believe that other factors should be taken into account before any notice is issued, because we really need to make sure that the correct person—the person liable—is the person that has been identified. It would be very helpful if the Minister could provide some information on how the Government can ensure, in future, that this is what happens, so that we do not end up with people with no responsibility suddenly having a lot of problems with sorting out works on the property in which they are living but for which they do not have responsibility.
We have laid the amendments on the assets of community value because they are very important. We believe that communities should play a key role in both the preservation and the delivery of local assets that sit outside of local authority control. We know that the Localism Act 2011 contains important powers for local communities to be able to do just this, but the problem is that there are issues around how it works. Under current rules, buildings or pieces of land which are, or have been, used to
“further the social wellbeing or social interests of the local community and could do so in the future”
can be nominated to be classified as an ACV by community groups or councils. But if an ACV goes up for sale, a local group that can make a decision as to whether it wants to bid for this is given only six months to gauge whether it is able to bid for it—and it is only during that six-month period that the owner is unable to sell it. After that six-month grace period elapses, they can sell assets of community value to anybody they want to. A report compiled by the Levelling Up, Housing and Communities Committee in Parliament suggested that the six-month grace period was too short and that it would sideline groups in more disadvantaged communities from being able to make bids. We believe that this needs to be changed.
The Labour Party has proposed extending the time frame to 12 months. We believe that local people from every community—not just those who are wealthy and have the resources to put their bids together very quickly—should have the opportunity to take control of, possibly, pubs, historic buildings or, perhaps, football clubs that come up for sale and would otherwise just fall into disrepair. We also believe that they should have first refusal on valuable assets when they come up for sale, including the right to buy them without competition. They should also have the right to force a sale of land or buildings that have been left to fall into a state of significant disrepair. If these processes were reformed to allow and encourage every community to take advantage of it, it would do so much more for the large number of communities that are currently threatened with losing community assets but do not have the ability to put together bids to take them under community control. I urge the Minister to look carefully at how this could be improved for the benefit of all communities.
I would like to make a few comments on Amendment 245, in the name of the noble Earl, Lord Lytton, about the results of the Historic England pilot on compensation rights. This comes under Clause 98 of the Bill, which seeks to remove compensation when a local authority has wrongly served a building preservation notice which, when it was served, prevented any additional work from progressing. We have been talking to the CLA about this, and it disagrees that this is the right way forward, as not only are there significant property rights implications but it also removes an important check on local authorities that wrongly serve building preservation notices. This can cause huge disruption and costs for the owners. We believe that compensation is key to the protection of individuals’ rights. Moreover, the many compensation provisions across the planning system are a vital part of its fairness. If mistakes happen and people suffer loss then, surely, they should be compensated. I shall not talk any further on this because I am sure that the noble Earl will go into great detail, but we appreciate his amendment. It is an important area that needs to be looked at.
My noble friend Lady Andrews has also put down some important amendments on the demolition of buildings, development rights, reduction of carbon emissions and the importance of local communities’ abilities to shape local places. Currently, most buildings can be demolished without planning permission if they are not listed and not in a conservation area. These permitted development rights for demolition have already been removed for buildings such as pubs and theatres, but there is no requirement for the buildings to be run down or beyond repair for this right to apply. We have had some very helpful briefings from the Victorian Society about its concerns on these issues, and we consider that my noble friend’s amendments are very important. I hope that the Minister can support them. I beg to move.
The Earl of Lytton (CB)
My Lords, I will speak to Amendment 245—a probing amendment—in my name and that of my noble friend Lord Devon. Unfortunately, my noble friend cannot be here today due to other pressing matters. I must first declare my ownership of two listed buildings and the occupation of a third. I have also acted professionally as a chartered surveyor who has surveyed many listed and unlisted buildings and structures where works were proposed. I am very grateful for the support and input of the CLA, of which I am a member, and of Historic Houses and the Listed Property Owners Club. I am particularly grateful for, as it were, an introduction by the noble Baroness, Lady Hayman of Ullock. It was rather unexpected, because I did not think that it would necessarily be a matter that her party would relate to in those terms.
I acknowledge the importance to the nation of protecting its heritage. When the listing of buildings first came about in, I think, the 1950s, it carried with it an obligation to seek consent for works that affected the character of a listed building. It was not originally the case that effects on character meant that every alteration required consent. However, over the years, because the citations for listing and the descriptions of the matters of importance were, to put it bluntly, minimalist, that is how it has come to be operated. It has now almost become the norm for common periodic maintenance and repair to be caught by a demand for formal consent—things which, for any other unlisted building or structure, can be done without any formality.
Baroness Andrews (Lab)
My Lords, this is an important group of amendments, and I have great pleasure in supporting them all. I have two amendments in my name, which reflect a particular interest that the Victorian Society has in the demolition of non-listed buildings. I am very grateful to the Victorian Society for marshalling support for these amendments. I would also say that these are amendments that sit the heart of the Levelling-Up and Regeneration Bill, and they follow present practice, to which I will draw attention. I am grateful to the noble Lords, Lord Shipley and Lord Carrington, for their stamina in being here to support these amendments. I will try to be brief.
My amendments address a serial, long-standing failure to protect the historic built environment that gives the ordinary places we live character, memory and beauty through familiar structures. Nationally protected buildings are, as we know, protected if they are listed. They are secured by law, but the demolition of most buildings is permitted without planning permission if they are not listed or in a conservation area, even if they are in good condition and have potential new uses. This has been happening, as recorded by the Victorian Society, across the country, and the problem is that because of the historic underlisting of important buildings that Historic England identifies through the Saunders report. Buildings that are potentially listable and not on the list can be demolished.
Permitted development is exactly what it says: the ability to demolish or change a structure with none of the protections or local involvement that the planning system provides. It has been an unwelcome flood that has been extended in recent years, which brings unpredictability and perverse consequences. It is well overdue for a review, and I ask the Minister to consider very seriously whether he and his colleagues can put that into practice now.
The changes that PDR promotes, together with what the noble Lord previously implied—the hollowing out of planning departments and the loss of conservation specialists—means that our villages, small towns and cities are at greater risk than they have been for some time. The risk is from cumulative change as well as casual change, and it is irreversible. Locally listed buildings—a very small number in relation to the whole—are now particularly vulnerable. My two amendments focus on these groups.
Amendment 312G would remove permitted development rights for all demolition. It would allow for public consultation and would protect all non-designated heritage assets. Amendment 312H focuses on the local listing of buildings. It removes permitted demolition rights for locally listed assets and protects non-designated heritage assets that are on a local planning authority’s local list. This is long overdue. We also suggest that the Secretary of State could provide further clarity by setting out a definition of what qualifies as a local list following consultation.
These amendments are timely and would re-engage local communities. They would be extremely welcome, and I offer them as a gift to the Government, who are now in an election year. They are timely. Is it not better to save our historic assets that are still safe, habitable and useful than to pull them down? Increasingly, this is how people feel. In recent years, when so much in the country has shifted around us, we have come increasingly to value the quality and resonance of our local environment. This intensified during the pandemic.
When I was heavily involved with the Heritage Lottery Fund, we funded a great deal of locally inspired small projects within 15 minutes of the places where people live. We had a tremendous response. It drew out of local communities the things that they felt were really important to them. It is clear that keeping and repurposing historic buildings—schools, surgeries, churches, cinemas, factories, mills—is seen as an infinitely better alternative and one within reach. They retain character and diversity and inspire unique pride across the generations. We have lost so much, and we will lose more unless we stop and pause.
Once something is gone, whether it is the Euston Arch or a local cinema, we cannot recover it. At a time of so much instability in the high street and excessive office building, surely the time has come to rethink and repurpose for what people need today, whether that is childcare centres or marketplaces.
Lord Carrington of Fulham (Con)
My Lords, I rise to support the amendments that were so ably addressed and presented by the noble Baroness, Lady Andrews. These are important amendments because the demolition of historic building is a very long-standing problem. I do not want to go through all the arguments that the noble Baroness, Lady Andrews, ably set out in her speech; I want to consider some slightly different issues which these amendments would help to address.
Part of the long-standing problem is that historic buildings are not properly protected by either our planning or listing systems. This is partly because fashions change, partly because of prejudice and partly purely because the legislation does not keep up with the need to protect buildings as they become old and more vulnerable. It is an old problem. Those of us who go back a few years—I ought to say that I have been a member of the Victorian Society since I was a teenager, which some of you will be surprised to hear was one or two years ago—will remember the Firestone factory, which was expected to be listed as a great Art Deco building. It was knocked down overnight—indeed, it was severely damaged to ensure that it could not be repaired—to stop it being listed. The Firestone building was not alone. Those of you who remember the last 20 or 25 years will recall Kensington Town Hall in Kensington High Street. Outrageously, the local council, whose politics I strongly agree with, knocked down the façade of the old town hall overnight to stop it being listed. Neither of these buildings would necessarily have been a great priority for listing, but they were certainly well worth protecting.
Another problem is that the listing regime has a bias, as the noble Baroness, Lady Andrews, has said, against buildings which are post-1850. This means that if a building is prior to 1850, it is very likely to be listed; if it is after 1850, it is less likely to be listed. I just have to tell you the names of some of the architects whose careers were entirely after 1850: think of the very great Richard Norman Shaw, Charles Voysey, Edwin Lutyens and Giles Gilbert Scott, who rebuilt the new Chamber of the other place down the corridor. These days, all their buildings would probably be listed.
Of course, architecture was not only great architects. Often, the great architect would put up a design, maybe even publish the design, and other architects would then take on that design and build buildings which perhaps did not have the genius of a Richard Norman Shaw but possibly had the style of one. These days, English Heritage would almost certainly consider them to be derivative and therefore not worthy of protection. It is a very serious problem.
Having slightly defined one bit of the problem, I want to come on to why developers use the permitted development rights to knock down buildings. If a developer is buying a building, he is buying it almost in every case to build another building on the site, unless he is trying to extend his garden. If a developer rushes in to knock down what was there before, before getting planning permission to build what they are going to replace it with, there is a reason for doing that. One reason may be, as with the Kensington Town Hall and the Firestone tyre factory, that they thought it might be listed. The other reason is that it is much more difficult for a planning committee of a local authority to refuse planning permission to an empty site than it is to a site that already has a perfectly usable building on it, so they will knock it down. There is a third reason, the one raised by the noble Baroness, Lady Andrews, concerning VAT—they may feel that there is an incentive to get on with the work because of the VAT and the cash elements in it, but, frankly, that is minor compared with the other two.
So there is an issue here which needs to be addressed. There is no reason why developers should not be required, at the time they put in their planning application to rebuild on a site, to put in a similar, parallel application to demolish. I am not saying that every building should be protected; that would be nonsense—there are a lot of buildings which, quite frankly, could easily be replaced with better buildings. What I am saying, and I believe this is also what the noble Baroness, Lady Andrews, was saying, is that we need to think about it. We need to look at the building that is there and say, “Is this a building that could better be used by being refurbished and keeping the character of the town or street preserved?”.
Those of us who have travelled, as I am sure all of us have, around Europe will be well aware of the beauty of towns in France, Germany or wherever, where the character of the town has been preserved to look as though it evolved gently over time to reflect the character of the people. Too often, our towns and high streets are a higgledy-piggledy collection of some fine buildings, some meritorious buildings, some rather dull buildings and some buildings that look as though they were designed and built purely with the idea of keeping the costs down but with no real element of design. We need to bring this to an end: we need to stop developers’ profits determining what it is that our towns, villages and high streets look like—we need to ensure that more thought goes into it.
I think these amendments go a long way to achieving that. The problem I have with them is that some of the worst offenders in knocking down buildings are local authorities themselves. Sadly, local authorities will police their own planning committees, and consequently if they want to do something for whatever reason and there is a building in the way, they will give themselves planning permission to knock it down and rebuild when they probably should not. I do not know how we get round that, but it is a problem and has been a problem in London for some time, where civic buildings in particular have been knocked down outrageously because the town hall decided that what it really wanted to do was build a monument to the current councillors. That is something which we need to address and these amendments do not address it, but they are a movement along the way.
It has also been suggested that it would be sensible for these amendments to have timelines in them. The suggestion has been twofold. One is that the time should be 1948, so we would not remove permitted development rights from buildings built after 1948. I would oppose that. As much as I like Victorian and early 20th-century buildings, some very fine buildings built after 1948 are vulnerable too. The other suggestion is that the timeline should be based on 1850, which, frankly, is a nonsense for the reasons I have already given. Therefore I strongly support these amendments.
Lord Shipley (LD)
My Lords, I agree strongly with what the noble Lord, Lord Carrington of Fulham, just said about Amendments 312G and 312H, as well as with what the noble Baroness, Lady Andrews, said about them. This is a particularly serious matter and I hope that the Government will pay due attention. A range of issues has been raised in this group, the comments made by the noble Lord, Lord Carrington, on timelines might be a possible way forward for discussion and prove productive.
I have had concerns for some time about permitted development rights, feeling that in some cases they are simply too loose. My previous concerns have related, for example, to conversions of offices to residential flats for sale, which often reduces the total number of places where people can go to work and increases the distances to where their place of work may then have to be. Very often, permitted development rights are used for short-term development reasons but where those reasons may not be in the long-term interests of a local area, and we need to remember that long term.
I have put my name to Amendments 312G and 312H alongside those of the noble Baroness, Lady Andrews, and the noble Lord, Lord Carrington of Fulham, because there is another aspect of permitted development rights that I believe needs reform in the interests of maintaining our heritage. According to the Royal Institute of British Architects, approximately 50,000 buildings are demolished each year. Many of them may well be unfit or unsuitable for the modern age, and demolition is understandable in those cases where they are going to be replaced with something better.
However, that is not always the case, as we have heard from previous speakers. The Victorian Society has produced evidence that high-quality historic buildings are being demolished when they still have a useful purpose. Many buildings are not listed when they could be. I have concluded that there is a gap in our regulations, which should require that older buildings, at least, that are not listed, should have to undergo a further test. That test is, I suggest, the planning system, which could consider demolition as part of a redevelopment application. If there is no redevelopment application, there is no obvious reason to demolish the building, where it is safe. That could end up with an empty site for a long time, or a later application for a worse development than the building demolished.
These arguments relate to Amendment 312G, but Amendment 312H is also critical. It requires planning permission to demolish locally listed buildings. These lists exist for a reason, and demolition should not be treated lightly. Strangely, not all local councils have local lists anyway, which is another concern.
It should not be possible for buildings on a local list to be demolished without planning permission if they are outside a conservation area—rules currently apply if they are inside a conservation area. I ask the Minister: what is the point of a local list otherwise? Local lists need protection from poor, short-term decisions on demolition which are contrary to our long-term heritage interests. This is about buildings that matter to local people and future-proofing our heritage, and I very much hope the Minister will concur.
Lord Thurlow (CB)
My Lords, first, I simply put right a matter of record. I failed to declare my interests in our debate before lunch. I have two buy-to-let properties, as marked on the register.
I now briefly reference Amendment 247B from the noble Lord, Lord Cormack, ably introduced by the noble Lord, Lord Carrington of Fulham. I refer to our heritage assets in the context of properties, as well as statues and artwork. In the UK, a disproportionately small minority can cause heritage assets to be removed from public view, whether they are in public or private ownership or locations.
Furthermore, the world we live in of modern development seldom includes a requirement on developers to contribute to what I think is referred to as the public realm. Most larger developments, as we have heard from the noble Lord, Lord Carrington, are built to minimum cost. We must not forget that good architecture and good design—itself expensive—is a great contribution to the public realm. The presence of statues and monuments, and good building design is a really important contribution to society. Planning applications should have a public realm box, simply to ask whether they are making any contribution to the public realm and heritage assets. The amendment of the noble Lord, Lord Cormack, should also refer to heritage assets which are stored out of sight and yet are in public ownership.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord Parkinson of Whitley Bay) (Con)
My Lords, this group of amendments relates to heritage, assets of community value and permitted development rights for demolition of buildings. I am pleased to be responding as Minister for Heritage, and I am very happy to discuss these matters with individual noble Lords, as I speak for the first time on this Bill.
Amendment 243, tabled by the noble Baroness, Lady Taylor of Stevenage, and moved by the noble Baroness, Lady Hayman of Ullock, would require the Secretary of State to publish a review of local heritage lists and the results of the 2018 review of the non-statutory guidance on assets of community value. That review was undertaken to shape the future direction of the policy in the levelling-up White Paper that His Majesty’s Government committed to and explore how the existing community asset transfer and asset of community value schemes can be enhanced. We will continue to make funds available to groups through the community ownership fund.
Regarding the review of local heritage lists, the Government recognise the importance of identifying and managing those parts of the historic environment which are valued by their community. We have given £1.5 million to 22 places across England to support local planning authorities and their residents to develop new and update local heritage lists. Our intention is that the lessons learned from that work will be shared with other local authorities so that they too can benefit from the good practice that is building up in this area. As part of the development of the new national planning policy framework, we will also develop new proposals for statutory national development management policies, including policies to protect local heritage assets. Such proposals will be subject to future consultation; we would not want to pre-empt the outcome of that consultation by taking steps such as those envisaged in this amendment right now.
Amendment 246, also tabled by the noble Baroness, Lady Taylor, would require draft legislation to reform assets of community value to be published within 90 days of Royal Assent of this Bill. Community assets play a vital role in creating thriving neighbourhoods. The assets of community value scheme enables communities and parish councils with the right to register a building or piece of land as an asset of community value if the principal use of the asset furthers their community’s well-being or social interests and is likely to do so in future. The scheme has been successful in helping community groups to identify important local assets at risk of loss. As I have mentioned, the levelling-up White Paper committed us to consider how the existing assets of community value framework can be enhanced. We must ensure that any changes to the legislation are workable in practice. To do this in a meaningful way needs consultation with all the parties that it will affect, including community groups, local authorities which are responsible for listing assets, and businesses and private individuals who are property owners. An amendment such as this risks creating legislation which does not work in practice. The framework must balance community power and the ability to safeguard community assets in a way that is fair, targeted and proportionate. We are committed to exporting the scope for improvements which can maintain this important balance, but it is important that we do so in a way which gives time with those with an interest to reflect on their experience and any proposals for change.
Amendment 244, also tabled by the noble Baroness, Lady Taylor, would mean that when deciding on the correct recipient of a temporary stop notice, the authority should have regard to the tenancy status of the occupier and their level of responsibility for any works on the property. Clause 96 addresses a gap in the enforcement powers available to local authorities in relation to listed buildings, which will help to protect these irreplaceable assets for generations to come. While under the Town and Country Planning Act 1990 local authorities have the power to serve temporary stop notices, there is currently no equivalent power in relation to listed buildings. Clause 96 amends the Planning (Listed Buildings and Conservation Areas) Act 1990 to give local planning authorities the power to issue temporary stop notices in relation to unauthorised works to a listed building in England.
The noble Baroness’s amendment seeks to add a requirement for local planning authorities to have regard to the tenancy status of the occupier and their level of responsibility. Temporary stop notices are an existing enforcement tool which local planning authorities are accustomed to issuing. Those planning authorities have experience of considering matters such as tenancy status and the level of responsibility for works carried out when they serve such notices, which would also apply in this context. The Government believe that the local planning authorities do not require the additional guidance that this amendment would provide, so they do not feel that it is necessary.
The noble Baroness, Lady Hayman of Ullock, asked me how local authorities can identify the owner of the properties when sending out a temporary stop notice. They can use a variety of sources: for instance, council tax records, planning application registers, and the Land Registry are some of the open sources of information that they are already able to consult. Usually, they would do everything they can to identify to whom it should best be served, and it can indeed be to a variety of people.
The Earl of Lytton (CB)
Could the Minister explain why he considers it appropriate for authorities to have this power but, to visit direct—and it must be direct—loss in order to be compensable, he thinks it is not appropriate that the exercise of powers should be accompanied by compensation? What other areas where the compensation code might be deemed to apply does he think are in some way disposable? I remind him of the principles that I referred to right at the end of discussing human rights, on the questions of the reasonable enjoyment of one’s property, not being dispossessed of it by the state other than for an overriding reason, and then only on the provision of proper compensation, determined by an independent adjudicator if necessary. Does he depart from those particular principles?
Lord Parkinson of Whitley Bay (Con)
I am grateful to the noble Earl for his questions. If it is helpful, I am very happy to speak to him in advance of my meeting with Ben Cowell next week, so that I can have a fruitful discussion with him and with Historic Houses on this point.
He asked about the Secretary of State’s declaration on the Bill. That is self-evident: the Secretary of State has found it compatible with human rights laws. But I will leave it to colleagues at the Secretary of State’s department to speak further on that. With the offer to meet the noble Earl ahead of my meeting, I hope that he will be happy with the point that I have outlined about wanting to remove what we see as a hindrance to these notices being served.
Amendments 312G and 312H, tabled by the noble Baroness, Lady Andrews, would require the Secretary of State to remove permitted development rights for the demolition of buildings. These amendments aim to reduce demolition and consequently carbon emissions, to increase communities’ ability to shape local places and to protect non-designated heritage assets. I completely agree with the remarks she made about the value of historic buildings and our historic environment to communities and the importance of preserving them for generations to come. I pay tribute to the work she has done over many years on this at English Heritage, the National Lottery Heritage Fund and in many other ways.
Permitted development rights are a national grant of planning permission that allow certain building works and changes of use to take place. There is a long-standing permitted development right which permits the demolition of buildings, subject to certain limitations and conditions, as she outlined in her speech. Her Amendment 312G seeks to remove this permitted development right for all but the smallest buildings. Her Amendment 312H seeks to remove the right for locally listed heritage assets only. These amendments would mean that works to demolish affected buildings would require the submission of a planning application.
I want to make it clear to noble Lords that the Government are committed to ensuring that planning permission contributes to our work to mitigate and adapt to climate change. National planning policy is clear that the planning system should support our transition to a low-carbon future, including helping to encourage the reuse of existing resources and the conversion of existing buildings where appropriate. The National Model Design Code encourages sustainable construction focused on reducing embodied energy, embedding circular economy principles to reduce waste, designing for disassembly and exploring the remodelling and reusing of buildings where possible rather than rebuilding. I know that our heritage bodies—not just our arm’s-length bodies such as Historic England but right across the sector—are doing sincere and fruitful work to make sure that we have the skills, not just now but in generations to come, to carry out the works to effect that.
I also want to stress that the Government recognise the need to protect historic buildings and other assets valued by their local communities. The heritage designation regime in England protects buildings of special architectural and historic interest, but we understand there are many other buildings and assets that local people cherish. Planning practice guidance encourages local planning authorities to prepare local lists of non-designated heritage assets. I mentioned earlier the £1.5 million we have given to support local planning authorities and their residents to develop new and updated local heritage lists, with the intention that the lessons learned from that work will be shared later this year.
Local planning authorities have the power, where they consider it necessary, to remove specific permitted development rights to protect a local amenity or the well-being of an area by making an article for direction. Powers to amend permitted development rights already exist in primary legislation. There are also tools within the existing planning system that can be used to manage demolition more responsively, such as the National Planning Policy Framework and local design codes. So, while we appreciate the importance of reducing carbon emissions, supporting local democracy and of course protecting heritage assets, we do not believe that these amendments are necessary to achieve those aims. I want to assure the noble Baroness that we will of course continue to keep permitted development rights under review and look at them with a heritage lens as well.
I understand the point raised by my noble friend Lord Carrington of Fulham about the protections available to more recent buildings. While the tastes of individual Ministers are rightly irrelevant in the process, I share his admiration for the work of Giles Gilbert Scott. I live close to what was King’s College Hospital in Denmark Hill and is now the home of the Salvation Army. I had the pleasure of speaking on 8 September last year—a date which sadly sticks in the mind—to a conference organised by the think tank Create Streets on diverse modernities, where I was able to talk about his other buildings, such as the university library and the memorial court at Clare College in Cambridge.
I said on that occasion that the Government recognise that the eligible age for protection by statutory listing needs to continue rolling forward. In the past, recent buildings have not been a focus for listing, but I am glad to say that that is no longer the case. One-third of the buildings listed by recent Secretaries of State have been 20th century buildings. I think one of the most recent examples is the headquarters of Channel 4 on Horseferry Road, which dates from the 1990s.
The listing regime is not prejudiced. As per the Secretary State’s principles for selection, planning and development are not taken into account when listing a building—it is done purely on historic and architectural merit. The older a building is and the fewer surviving examples there are of its kind, the more likely it is to have special interest. From 1850 to 1945, because of the greatly increased number of building erected and the much larger number of buildings that were constructed and have survived, progressively greater selection is therefore necessary. Careful selection is of course required for buildings from the period after the Second World War.
I am very grateful to my noble friend for speaking to Amendment 247B tabled by our noble friend Lord Cormack. As my noble friend Lord Carrington said, the noble Lord sends his apologies for not being able to be here in your Lordships’ House today. Noble Lords will know he is the last person who would wish to express discourtesy to your Lordships’ House. He has given me permission to share that it is only because he is collecting his wife from hospital following an operation that he is unable to be here today. I am sure noble Lords will understand and want to join me in wishing Lady Cormack a swift recuperation.
I am grateful to him for his amendment, which highlights the importance of lists of locally important heritage assets. I have been able to speak to my noble friend about his amendment and some of the points that lie behind it. As Minister for Heritage, I am, on behalf of the Secretary of State, responsible for the statutory designation system that lists buildings of architectural and historic importance, and protects monuments of national importance. Local listing is a non-statutory means by which local planning authorities can, if they wish, identify heritage assets that are of local importance but do not meet the criteria for national designation and statutory protection as a listed building or a scheduled monument, and then take account of these assets during the planning process. In recent years, the Department for Levelling Up, Housing and Communities has provided financial support to selected local planning authorities wishing to develop a local list with the assistance of Historic England.
Local lists are discretionary; some local planning authorities compile local lists and some do not. Under the terms of local listing, it is up to those authorities which heritage assets they include in local lists. I am not, at present, convinced that, given this discretionary nature, we should be legislating for local lists to include all statues and monuments in an area. While many statues and monuments are very clearly cherished by the local community and should be included on local lists, there will be instances where it would be inappropriate to include certain statues and monuments—for instance, a sculpture in somebody’s private garden. Local planning authorities, following consultation with their communities, are best placed to decide what should be included on a local list.
Our national designation system already ensures statutory protection of our most significant heritage assets, including statues and monuments. The national listing process already protects those that meet the criteria of special architectural or historic interest. We have recently increased the protections for non-designated statues and monuments in public places that are more than 10 years old, whether they are locally listed or not. Their removal now needs explicit planning permission, and we have made it clear in national planning policy that decisions on statues and monuments should have regard to our policy of retaining and explaining these important historical assets.
My noble friend raised the question of the definition of “alteration”, pointing to some examples, including the statue of the Earl of Beaconsfield, Benjamin Disraeli. As it is the day after Primrose Day, and the birthday of my noble friend Lord Lexden—the Conservative Party’s official historian—I must echo my noble friend’s comments about Disraeli and the amusement he might find in some of the treatment of statues of him today. But the point my noble friend makes is an interesting one, which I am happy to discuss with him and my noble friend Lord Cormack. As he is not here for me to ask him not to move his amendment, I offer, on the record, to discuss this with him and any other noble Lords. I beg all noble Lords whose amendments I have addressed not to move their amendments and beg the noble Baroness to withdraw her amendment at this juncture.
Baroness Hayman of Ullock (Lab)
I thank all noble Lords who have taken part in this debate, and I thank the Minister for his thorough response to these amendments. On my noble friend’s Amendment 243, I was pleased that the Minister said that the Government will continue to provide funds for assets of community value, but just providing funds does not address the problem that many communities do not have the capacity to put the bids together in the first place. That is our main concern here. It looks like we are again waiting to hear the detail—this time about what will be in the NDMPs. I guess we will be updated on this later on in the Bill, but I am sure we will return to it when we get to those particular clauses.
On Amendment 246, it is good that the Minister talked about the Government’s improvements in this area but, again, this comes back to the fact that more needs to be done to support all communities’ abilities to put together suitable bids and plans. Some communities are not able to; they do not have that ability. So it is not about the amount available—it is making sure that all communities have proper access and are able to put together suitable bids.
On the local heritage lists in Amendment 243, one of our concerns is that they do not have any standing in planning law, so there is a big gap between what has listed status and what is available to go on to local heritage lists. We think that local authorities should be able to determine that degree of protection, which they currently cannot, for buildings on their heritage lists. The noble Lord, Lord Shipley, said that many local authorities do not even know about them, so there is an issue there that the Government could perhaps take a look at.
The noble Earl, Lord Lytton, made some good points—he is always extremely clear about his concerns—and I am sure he will want to come back to discuss them further. My noble friend Lady Andrews made some really important points, as did the noble Lord, Lord Carrington of Fulham, when he supported her. She said that there had been a long-standing failure to protect our historic environment. Our amendments work with hers quite well to try to look at the bigger picture and strengthen protections. The noble Baroness made the important point that planning departments are really strapped, so they need more help to protect buildings from demolition. Developers have a lot of money and often a lot of resources available to them, but local authorities do not have those resources or the people. If the Minister is able to look at my noble friend’s second amendment again, that would be extremely helpful—there could potentially be some way forward. He seemed to agree with much of what she said, so perhaps he could suggest a similar amendment on Report, which would be helpful.
The noble Lord, Lord Carrington of Fulham, made a good point about certain iconic buildings that have disappeared. I am sure that all of us can think of similar buildings in our own communities that have gone, and it has really shocked people when they have been demolished unexpectedly, even when there was already an agreement that they would not be demolished.
So this is a good group of amendments, and I hope that the Minister will consider some of the arguments further. In the meantime, I beg leave to withdraw.
The Earl of Lytton
“(3) Subsections (1) and (2) shall only take effect following an order made by the Secretary of State.(4) The Secretary of State may only make the order in subsection (3) once a public consultation on the case for the change, drawing on the results of the Historic England indemnity pilot, has been completed.”Member’s explanatory statement
This amendment ensures that the results of the Historic England pilot are taken into account and that there is public debate and scrutiny before compensation rights are removed.
The Earl of Lytton (CB)
My Lords, I will not move this amendment, but I look forward to meeting with the Minister about this, and I may well return to it at a later stage in the Bill.
Lord Lexden
“Permitted development: replacement windows in conservation areasIn the Town and Country Planning (General Permitted Development) (England) Order 2015 (S.I. 2015/596), Schedule 2, Part 1, Class A.3(a), after “materials” insert “(and, in respect of a replacement window in a conservation area, style and colour)”.”
Lord Lexden (Con)
My Lords, I move Amendment 247, brought forward by my noble friend Lord Northbrook, who sadly cannot be here today. I will also speak to Amendments 247A and 285 in this group and in his name. I speak on his behalf.
The most important amendment in this group is Amendment 247A, and I shall deal with it first. It provides a solution to a significant problem. Local planning authorities—LPAs—in deciding on an application for development in a conservation area are currently required under Section 72(1) of the Planning (Listed Buildings and Conservation Areas) Act 1990 to determine whether the proposed development would preserve or enhance
“the character or appearance of that area”.
LPAs have a wide degree of discretion in deciding whether this statutory test is passed. In a number of conservation areas—and I am thinking particularly of the Royal Borough of Kensington and Chelsea—planning officers, for understandable reasons, do not normally live in or near the relevant conservation area, but they routinely substitute their own opinions for the opinions of those who do, frequently in disregard of the relevant conservation area appraisal document and advice from important third parties such as Historic England. This problem is particularly acute in the royal borough, where harmful decisions have been made in the past and then used as a precedent to justify approving further harm of a similar nature.
This line of reasoning has been criticised frequently by the Planning Inspectorate and runs contrary to the advice of Historic England in its Historic Environment Good Practice Advice in Planning: 2 called Managing Significance in Decision-Taking in the Historic Environment, which was published in March 2015. Paragraph 28 of this document states:
“The cumulative impact of incremental small-scale changes may have as great an effect on the significance of a heritage asset as a larger scale change. Where the significance of a heritage asset”—
and this, of course, includes the entirety of the conservation area—
has been compromised in the past by unsympathetic development to the asset itself or its setting, consideration still needs to be given to whether additional change will further detract from, or can enhance, the significance of the asset”.
Regrettably, such consideration is all too often not given by planning officers in their decision reports in the exercise of delegated powers or in their advisory reports to planning committees. Surely the people best qualified to assess whether a proposed development will preserve or enhance the character or appearance of a conservation area are those who live in it. Under this amendment, LPAs would be required to pay special attention to the views, if any, expressed by those who live in the area.
The Government might perhaps take the view that LPAs are already obliged to consider all comments made during the course of a consultation on a planning application, rendering the amendment unnecessary. However, the obligation in this amendment to pay special attention is stronger than the obligation merely to have regard to comments made and the amendment is specifically tied to comments made by those who live in the area. If planning officers wish to substitute their own opinions on what is good for a conservation area, they should explain clearly and convincingly why they seek to do so and why the views of local residents should not be respected. This amendment would introduce the necessary arrangements.
I turn now to Amendment 247, which concerns permitted development rights to install replacement windows in conservation areas. Currently, permitted development rights to improve or alter a dwelling house are subject to a condition that
“the materials used in any exterior work must be of a similar appearance to those used in the construction of the exterior of the existing dwellinghouse”.
The amendment would require that replacement windows in a conservation area must be of similar style and colour to the windows they are replacing, not just that the materials be of similar appearance, if the right to install the new windows is to be permitted development. This would not require replacement windows to be of similar style and colour, but simply bring them within the scope of planning control if they are not.
As we all know, many conservation areas in England have attractive streets of 19th-century terraced houses, in which the windows fronting the street are white-painted wooden sliding sash windows with traditional Georgian-style glazing bars enclosing relatively small panes of glass. Many LPAs routinely include as a standard condition of planning approvals in conservation areas that any replacement of sliding sash windows fronting the street should be like-for-like sliding sash windows, but this can be challenged successfully. For example, there was a remarkable case in the Royal Borough of Kensington and Chelsea, where the owner of a house installed an ugly, non-sliding sash window in breach of a planning condition. A complaint was made to the council and a request was made to planning enforcement to have the window removed. One of the local ward councillors, who happened also to be the cabinet member for planning at the time, said that it was clearly inappropriate and would need to be replaced as soon as possible. The enforcement officer agreed with the complaint, and an enforcement notice was duly served. The owner then told the council that his new window was in fact a permitted development; the result was that the enforcement notice was cancelled, and the enforcement officer accepted that the council had no control over its style. The window remains. I note, in passing, that it was very surprising that neither the owner, his planning consultants, the cabinet member for planning nor the enforcement officer were aware, at the time of the application, that the installation of the replacement window was a permitted development. That was a reflection of the confused state of the general permitted development order at the time, on which I shall say a few words when I turn to Amendment 285.
Is it not odd that the current applicable condition for the permitted development right to install replacement windows is merely that similar material must be used? That is to say that, if the window being replaced is made of wood and glass, the replacement window should also be made of wood and glass. The purpose of permitted development rights is to facilitate obvious improvements without the need for planning permission, but how can this entitlement to install ugly new windows be considered an improvement?
I hope that the Government will be inclined to consider the amendment sympathetically. If not, perhaps my noble friend will explain the logic of requiring similar materials but not similar style and colour. Replacement windows fronting attractive streets in conservation areas should be like-for-like; if not, they should need planning permission, and the GPDO should be amended to reflect that.
Finally, I turn briefly to Amendment 285. Schedule 2 to the general permitted development order sets out permitted development rights—namely, rights to develop for which planning permission is not required. It gets amended several times a year. Unfortunately, on the legislation.gov.uk website, there is often no up-to-date, consolidated text, so anyone wishing to see what rights exist, or which existed at the time of a specific application, has to spend many hours on the internet searching for all the amendments made to it since it came into force on 15 April 2015, and this research needs to be conducted separately on each occasion. I have mentioned already one example of where failure to provide a consolidated text confused even experts and professionals in the planning world. Most other legislation is available to read on the internet in up-to-date, consolidated form, so why not the GPDO?
Baroness Pinnock (LD)
My Lords, I have a lot of sympathy with the views expressed by the noble Lord, Lord Lexden, about conservation areas and permitted development rights. For residents who are fortunate enough to live in a conservation area, it is both a privilege and a responsibility. When the noble Lord was trying balance homeowners wanting to make appropriate changes—and sometimes inappropriate changes—and local planning conservation officers seeming to rule the roost over what is and is not appropriate, I asked myself, “Where were the local councillors in this mix?”. Where I am a councillor, I have conservation areas in my ward, and where there is a disagreement about what is appropriate, I ask for it to go to the planning committee. Then, it has a public airing, which is precisely what should happen. The planning conservation officer states one view and residents another, and a decision is made. One of the great purposes of planning committees is to air views, balance them out and come to a conclusion.
I also have concerns about always expecting to maintain the standards of a building that was created 100 or 200 years ago in wood and glass, when the rest of us are trying very hard to increase insulation, particularly of windows and doors. A couple of years ago, I visited a window manufacturer not too far from here which makes heritage windows from plastic. I could not tell the difference, even though I have an interest in conservation and heritage. In our regulations, we need to enable that to happen so that buildings remain appropriate for the time, while conserving the best features and personality of a townscape, which I know the noble Lord, Lord Lexden, wants to retain for people to love and enjoy in the future.
Baroness Hayman of Ullock (Lab)
My Lords, I thank the noble Lord, Lord Lexden, for introducing the amendments in the name of the noble Lord, Lord Northbrook.
I just make a very brief comment about the issue of replacement windows. My concern comes from a property that I know; it is in a conservation area and the windows are basically falling to pieces. It is owned by a young couple who applied for planning permission to replace the windows with something very similar, but not like for like—they could not afford like for like. Of course, they were turned down because it did not fit under the planning regulations as they are currently set up. A couple of years on, the outcome is that the windows are falling to pieces and nothing is happening. The couple are stuck, and the windows look dreadful. That is not their fault; they cannot afford to do what the planning inspectors tell them that they have to do.
I am very pleased that these amendments have been brought forward, because they enable us to talk about these anomalies in the way that the planning legislation is currently set up. It tries to protect the look of a place, but if that means that something does not happen because the owners of the property do not have the resources or finances to be able to do it, the property starts to decline. We have the example of windows, but it can be so much more. These are quite specific planning issues, but this is something that needs to be looked at.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, I would like to thank my noble friend Lord Northbrook for tabling these amendments and my noble friend Lord Lexden for so ably introducing them.
Amendment 247 would require amendments to permitted development rights. Permitted development rights are a national grant of planning permission which allow certain building works and changes of use to take place. Rights in relation to England are set out in the Town and Country Planning (General Permitted Development) (England) Order 2015 (2015/596). As we heard in the debate immediately preceding this group, heritage assets, including conservation areas, are an irreplaceable resource and it is important that we ensure that they are protected. Local authorities are required by law, in carrying out their functions, to pay special attention to the desirability of preserving or enhancing the character or appearance of conservation areas.
We are committed to quality and design regardless of whether homes are delivered through a permitted development right or a planning application. We intend to consult on introducing secondary legislation so that existing permitted development rights with design or external appearance prior approvals will take into account design codes where they are in place locally. Local authorities can remove specific permitted development rights to protect local amenity or the well-being of the area by making an Article 4 direction.
As committed to in the Government’s British Energy Security Strategy, we are currently undertaking a review of the practical planning barriers that households can face when installing energy-efficiency measures. This will include replacement windows with improved glazing, including in conservation areas. While this review is under way, it would be premature to accept this amendment, as it would curtail the scope of any legislative recommendations that the review might set out in due course.
To go further on that, because I know that this area was of concern to both noble Baronesses, Lady Hayman and Lady Pinnock, the Government are fully committed to encouraging home owners to incorporate energy-efficiency measures in their properties. As part of this, we recognise the need to ensure that more historic buildings have the right energy-efficiency measures to support our zero-carbon objectives. The review of heritage and energy efficiency committed to in the British Energy Security Strategy and currently under way will enable the Government to respond to the issue in an informed and joined-up way. In addition, powers to amend permitted development rights already exist in primary legislation. For these reasons, the Government are unable to support this amendment; however, we will continue to keep permitted development rights under review.
I turn to Amendment 247A, which proposes a new clause amending Section 72 of the Planning (Listed Buildings and Conservation Areas) Act 1990 to require, in exercise of planning functions, special attention to be paid to the views of residents in conservation areas. I understand my noble friend’s concerns. However, the purpose of Section 72 is to ensure that local planning authorities are required, when making planning decisions, to pay special attention to the desirability of preserving or enhancing the character or appearance of conservation areas. It is an important, long-standing duty that protects conservation areas.
Engagement with the sector during policy development for the Bill acknowledged that the framework for protecting the historic environment works well, although there are opportunities, we acknowledge, for targeted improvements. The package of heritage reforms focuses on maintaining the strong protections for the historic environment within the new planning system and, where possible, building on the existing framework. The proposed reforms will build on the existing protections without introducing any additional restrictions on development. It would be inappropriate to extend it so that local planning authorities have to pay special attention to the views of those living in conservation areas too. It would mean the views of conservation area residents would have greater weight than those living outside the area, which we think would be unfair.
In addition, in determining planning applications, decision-makers are already required to consult with local residents, and their views are taken into account. This will not change in our reformed system, and we are also taking powers in the Bill to improve the consultation process, making it more accessible by complementing more traditional forms of engagement with digital tools. It is not considered necessary, therefore, to duplicate these arrangements by extending the Section 72 special attention duty.
Turning to Amendment 285, we agree that it is important that the most up-to-date consolidated version of the general permitted development order, which sets out all the national permitted development rights, is publicly available online. Amendments to the order are often made, as we introduce new permitted development rights or make changes to the existing rights, through amending orders. The latest consolidated version of the general permitted development order is already available on the Government’s legislation website, alongside the original version.
I hope that I have provided the noble Lord with adequate reassurances, but we are unable to support these amendments at this time.
Lord Lexden (Con)
My Lords, I thank the two noble Baronesses on the Opposition Front Benches for their valuable points, particularly relating to replacement windows. I am grateful, above all, to my noble friend on the Government Front Bench for her full and carefully considered comments. My noble friend Lord Northbrook and those who are associated with him in giving further consideration to these matters will look very carefully at what my noble friend has said, and then they will be able to decide what further action they may wish to take. On that basis, I beg leave to withdraw the amendment.
Lord Young of Cookham
“(3) If there is conflict between street voting on development and the development plan, a determination must be made in favour of the development plan.”Member’s explanatory statement
The outcome of a street vote may conflict with the development plan. The amendment provides guidance on how to resolve this conflict.
Lord Young of Cookham (Con)
My Lords, we come now to the clause in the Bill dealing with street votes, which has generated a substantial number of amendments, of which mine is the lead amendment. It seeks to ensure that a street vote cannot conflict with a local plan. This clause was not in the Bill when it was introduced in another place: it was introduced on the second day of Report. The Government have said that Clause 99
“is intended to encourage residents to consider the potential for additional development on their streets, and support a gentle increase in densities, in particular, in areas where additional new homes are needed”.
I expect the Minister will describe the provisions of the clause in more detail, so I will not spell them out.
We have heard the expression “gentle densification” several times from the Secretary of State; it is something he clearly approves of. I will need some clarification before I lend it my approval, for this reason. Michael Gove was in another place, as I was, when the noble Lord, Lord Prescott, then John Prescott, the Secretary of State, came up with a similar policy of promoting suburban development and the development of back gardens. Those with long memories will remember that all hell broke loose. On 7 March 2007, the Daily Mail thundered:
“Thirty thousand gardens every year ‘torn up’ due to Prescott's policies”.
My party was whipped to vote on a Friday for a Private Member’s Bill to block the policy. Greg Clark, the then shadow Minister, wanted gardens to be reclassified as greenfield sites, and he took up the cause because local authorities were powerless to stop gardens being built on. When my party won the 2010 general election, Greg Clark, then the Minister, ordered changes to planning rules that meant gardens will no longer be seen as brownfield land, ripe for development. Crucially, it meant that stronger powers were available to local authorities to block “gentle densification”.
I just mention that to put this proposal in a broad historic and political perspective and to suggest some caution before we endorse it. Normally, and indeed given the controversial background to this proposal, innovation such as this, in the planning world, would be preceded if not by a Green Paper then at least by some form of consultation to gauge its practicality and effectiveness. This would involve the LGA, the Royal Town Planning Institute and, of course, the public. Nothing of the sort ever took place. This policy emerged from a think tank and was fast-tracked into primary legislation, overtaking on the way some well thought-out and badly needed policies on housing reform, in sharp contrast to the normal process of policy formation. I believe that the Government are adopting a high-risk strategy and, rather than going straight into primary legislation, they should test the proposal in the usual way and then consider how best to proceed. There is nothing particularly urgent about this, and we need to get it right.
Baroness Taylor of Stevenage (Lab)
My Lords, it is always a pleasure to follow the noble Lord, Lord Young. I will speak to our Amendments 249, 250, 251, 252, 253, 254, 255, 256 and 257 in the name of my noble friend Lady Hayman. A number of those amendments echo the concerns of the noble Lord. It is important to place on record that the clause to which amendments in this group refer was not in the Bill when it was debated in the other place, so it has not had the kind of scrutiny you would expect for a proposal of this kind. Therefore, it is right that your Lordships’ House gives this clause and the amendments submitted very careful consideration.
I agree with the noble Lord, Lord Young, that the progress of this proposal straight into primary legislation is unusual to say the least—I would call it inexplicable. I have much sympathy with his comments that, were the street votes part of a consideration that the planning and development committees took into account, that might be a different issue. However, from the proposal in the Bill it seems that they are intended to sit outside that.
In recent decades, changes to the planning system have meant that local people and, on occasion, local councillors have felt that they have little say or control over what happens in their area due to a combination of permitted development, changes to use classes—meaning, for example, that there is little to stop your high street being dominated by betting shops and vape stores—the prevalence of conversions to houses of multiple occupation, which puts particular pressure on infrastructure and parking and can change the character of neighbourhoods, and the hollowing out of so many coastal and rural areas as family homes become holiday and Airbnb lets. We have heard powerful advocacy for the role of neighbourhood forums and town and parish councils in previous debates on the Bill. There is undoubtedly something of a community engagement vacuum in the delivery of new homes which the advocates of street votes believe they can help fill.
As a member of the Co-operative Party, a sister party to the Labour Party, and a former chair of the Co-operative Councils’ Innovation Network, I have spent more than 10 years promoting and supporting greater engagement of residents and communities in the decisions taken on their behalf, so we absolutely support the principle sitting behind the street votes proposition. I am very grateful to Samuel Hughes from Create Streets, who took a great deal of time to brief me and my noble friend Lady Hayman and kindly provided us with a background briefing on street votes.
The problem with the clause as drafted is that it is very thin on detail, not least any detailed definition of “gentle densification”, which we have heard so much about during the Bill. I am sure that the Minister will tell us that it will be in the regulations or the National Planning Policy Framework, but in this case it is particularly important to understand how the system of street votes will work. Even their most passionate advocates feel that there is room for more clarity in the Bill.
Our amendments in this group attempt to understand how this detail and some of the potential complications will be resolved. As an example, although greenbelt, areas of outstanding national beauty and historic buildings are expressly excluded, there is no mention of conservation areas.
In his article, which is generally very positive about street votes, the designer Alastair Parvin points out that, when you start thinking about the detail of how they might work, it is not hard to see how it could all go very wrong. Those of us who have been involved in planning will feel the same trepidation that what seems, on the face of it, like a move towards community engagement, development and an ultimate expression of street democracy, may also need to be particularly well thought through in advance to avoid the obvious potential pitfalls.
The system of local authority planning may seem bureaucratic, complex and too slow, but you could argue that it is developed that way to ensure, for example, that experts in planning, law and finance are involved, that there is transparency in the process, that decisions are properly debated and recorded, and that there are proper voting procedures, appeals processes and declarations of interest. As Alastair Parvin notes, to even think about the idea of every street in the UK emulating this way of working, appointing an urban designer, holding consultations, drawing up a valid design code, having it checked against local policies, revising it, holding committees, leafleting, then organising a referendum, is utterly exhausting and could be expensive in time and money. It could also add a significant potential burden on to local planning departments that are already feeling overstretched. He also points out that community politics can be, at best, dominated by those with the loudest voices and, at worst, pretty toxic, with the potential for style wars or tribalism to develop, or those who are fixated about parking to take over—in my experience, there are plenty of them. I loved his line,
“we’re talking about doing design-by-committee with Alan Partridge on the committee”.
How do we ensure that those participating are not being coerced or receiving financial inducements, particularly the elderly and the vulnerable? Street votes will also have to take into account that, while many places in the UK may have well-defined streets, as the noble Lord, Lord Young, pointed out, some do not. There have a variety of layouts, types and styles, with perhaps less well-defined groupings or boundaries. Some of you may be familiar with Radburn layouts that are common in first-generation new towns, where houses that appear to be on one street are actually in three different streets.
It is important that we note the comments of the Local Government Association, which were quoted by the noble Lord, Lord Young. It says that it wants to work with government to enhance opportunities for engagement and reach a wider audience within the process of developing local plans, and that is the key to the answer here. Amendment 248, in the names of noble Baroness, Lady Thornhill, and the noble Lord, Lord Young of Cookham, is welcome and very straightforward, and we would certainly support that amendment to bring clarity to the precedence of the local plan, should the outcome of a street vote conflict with that.
My noble friend Baroness Hayman’s first amendment ensures that residents who have a recent connection with the area are included in street votes. We are very grateful to Generation Rent for its proposals in this respect. It makes the valid point that street votes must work for renters as well as owner-occupiers. Part of the answer, which is included in the Bill, is to enfranchise residents, not owners, so that tenants have as much democratic say as owner-occupiers, and absentee landlords are not further empowered over tenants’ homes. However, we agree with Generation Rent that this is not enough in itself so, before any homeowner or landlord can redevelop with permissions issuing from a street vote, any tenant resident in the building over the past two years must have consented. The alternative could be that landlords could refund 12-months’ rent or give their tenants 12 months’ notice. The Bill is very light on issues affecting tenants in this way, which is why we hope that our amendment will redress that balance.
Amendment 250, in the name of my noble friend Baroness Hayman, relates to the important issue of voting thresholds. We believe that it is important that it is a very high proportion; we would suggest two-thirds of total residents should support the proposals, not just a majority of those who turn out to vote. This ensures that developers cannot try to game the process and proposals can pass only if they have the overwhelming support of local people.
Create Streets, working with London forums and the Community Planning Alliance, also suggests two further safeguards—first, requiring that a resident in at least half of eligible households vote in favour, and second, that at least half of those registered to vote at the addresses on the street for at least three years must vote in favour. We would like to see this detail in the Bill but, if not, perhaps it could be considered for any subsequent statutory instrument.
Lord Stunell (LD)
My Lords, it is a pleasure to follow the noble Lord, Lord Young of Cookham, and the noble Baroness, Lady Taylor of Stevenage, in this debate. My contribution is quite modest compared to their overarching and sweeping criticism of Clause 99 but, just by way of flanking fire, perhaps I can say that it covers eight pages of the Bill, which is more than the whole of Part 1, which sets up the mission statements. That seems to me to be a wholly disproportionate application of drafting time, when we consider the level of detail not present in Part 1 and the level of detail here. That is perhaps the only point at which I would wish to challenge the noble Baroness, Lady Taylor of Stevenage, in her request for yet more detail. I honestly do not think this Bill needs any more detail on street votes.
Nevertheless, I have tabled Amendment 253A, which aims to ensure that where approved neighbourhood plans are in place, they cannot be overturned by a street vote. It is, to that extent, rather in the same vein as Amendment 248, moved by the noble Lord, Lord Young. He set out that there should be a clear hierarchy between street votes and development plans so that local development plans trump street votes. My amendment takes a different approach to neighbourhood plans. It simply adds to the list of places where street votes cannot be held—which exists in the Bill—those areas that have valid neighbourhood plans in force. In other words, within areas where there is an approved neighbourhood plan, street votes are not to be an available mechanism.
Like the two previous speakers, I do not really get what value there might be in street votes as a concept. I see some places where they may create or might enable some worthwhile flexibility at a micro level below the reach of borough-wide development plans. However, I admit that I am struggling to imagine what a good example of that might exactly be. It has been suggested, by the Minister, apart from anybody else, that it provides the opportunity for low-level densification of homes in a street. I think the noble Lord, Lord Young, commented to some extent on that, but I will just pick up a point made by the noble Baroness about biodiversity.
One of the things that recent planning changes have brought into view is that gardens should not be paved because of the need to maintain natural drainage. The more the footprint of buildings is increased, the bigger the run-off and the bigger the risk of local flooding at the least. Therefore, that connection will sometimes be a consideration which needs to be taken into account.
It is easy to imagine some less benign examples of street votes, such as perhaps a west London street agreeing that sub-basements with cinemas and car parks would be perfectly fine there. If that was done on the basis of a referendum, the result of which—just to pick two figures out of the air—was 52% to 48%, there would not just be some discontented people living in neighbouring streets but perhaps substantial levels of discontentment in that street.
That brings me to ask a question about who gets to vote. Presumably they are people registered on the electoral roll. That is just as well, because in that west London street the big houses probably also have five or six servants—chauffeurs, cooks and chefs—and, of course, the let-out as far as the voting goes is that they are probably not UK subjects. The noble Baroness made a good point on behalf of renters: in a community, particularly an inner urban area where a transient population is normal, who votes, when they vote and what the qualification is to vote is important.
One of the many pluses of a neighbourhood plan, particularly the process leading up to its adoption, is that all those nook-and-cranny micro details can be considered and a consensus built as part of that plan. That is itself subject to a public endorsement and a referendum. It seems to me fundamentally wrong to have a situation in which such an endorsed, publicly recognised and approved plan, with a level of local public participation that far exceeds the adoption of a local development plan by a planning authority, could be overruled or subverted by random revocation of bits of it in the street votes.
My argument is straightforward. Essentially, where a valid neighbourhood plan is in force, all the work on microsites and flexibilities will have taken place already in drawing up that plan. Whatever the merits of the principle of street votes, they would be an unnecessary duplication of effort and expense within a neighbourhood plan area. My amendment avoids that overlap and the inevitable confusion it would cause in the local community if its democratically prepared neighbourhood plan was set aside, even if only in one part. I hope to hear that the Minister agrees with that and will accept my amendment.
Baroness Pinnock (LD)
My Lords, I think we can say that there has been a less than enthusiastic response to the proposals in Clause 99, and I endorse everything said by the three previous speakers. Rather than laying out any other reasons in great detail, which other noble Lords have done, my questions for the Minister are these. First, what is the problem to which this is the solution? Secondly, what is a street? I know there is a clause defining a street, but I should really like to know whether Manchester Road in Huddersfield, which stretches for seven miles, counts as a street, or Halifax Road, which goes from Halifax to Dewsbury. Is 10 miles a street? I need to understand what a street is.
That leads to my third question. We have discussed at length in the past few days the purpose of planning and what is required of our planning system to enable development, but also to enable communities that work and to protect our environment. Currently, any planning application for more than one house needs a construction management plan but there is no reference to that in Clause 99. In any development of the sort that I think is being considered—back gardens or whatever—there is also the question of linking to the existing utilities, particularly water and wastewater removal in some areas. We need to know how sustainable that will be or whether there will have to be sustainable urban drainage to achieve it. Where I am now, nearly all the developments must have attenuation tanks built into them to do what they say: hold back the water to reduce the risk of flooding. All that would need to be thought about, as well as the issues that the noble Baroness, Lady Taylor, raised about biodiversity.
The Government, in their wisdom, changed permitted development rights of change of use from offices to residential areas. Because that could be done without proper process, one of the big issues that ensued concerned parking—or the lack of it—because there was no provision and no consideration had to be given to it, so none was applied for and there was a big problem.
Earl Howe (Con)
My Lords, a range of questions have been asked on this group of amendments. It might be helpful if I begin with the question posed by the noble Baroness, Lady Pinnock, and set out why the Government are bringing forward this measure in the Bill.
Local people can, quite understandably, be resistant to new development in their area if they have little say over what gets built and it does not reflect their preferences. However, many of us know that residents are often more supportive when they can play a direct role in shaping that development, including what it looks like. The Government are looking to deliver more good quality homes in the right places. To help achieve that, we want to encourage some intensification of development in existing residential areas, particularly areas of low density in towns and cities where this has the support of residents.
Clause 99 introduces street vote development orders, which will provide residents with a new opportunity to take a proactive role in the planning process and bring forward the development that they want to see on their streets. This new route to planning permission will support wider local efforts in bringing forward developments of new or more spacious homes in places where they are needed most. Amendments 248, 251, 253A, 254 and 257 all deal with how street votes will fit with the wider planning system and related requirements, and I propose to address them as a group.
In moving Amendment 248, my noble friend Lord Young of Cookham emphasised the desirability of achieving maximum certainty in the planning system. The first thing for me to say is that we want to create a predictable system where residents have a high degree of certainty on what development is likely to be permissible before they prepare a street vote development order proposal and that we want to make the system accessible and easy to use. To achieve that, we propose to do things a bit differently with this new tool. We want to depart from existing practice, which relies heavily on the interpretation of local policies to determine whether a development is appropriate, and move to an approach where proposals are assessed against more precise requirements which will be prescribed in regulations. These prescribed regulations will include what type of development and what type of uses are allowed, as well as detailed design requirements such as floor limits, ceiling heights and the extent to which a plot can be used.
We want to test this through consultation ahead of drafting the secondary legislation. These requirements will provide residents with that certainty and ease of use and be designed to ensure that street votes development is high quality and that any local impacts are managed. While I understand the intentions behind my noble friend’s amendment, it would, if agreed, prevent us applying this new approach and therefore I am unable to support it. I emphasise that this is an issue that we intend to consult on as part of a wider consultation on the detail of the measure to ensure that a wide spectrum of views is considered and that the policy delivers for communities.
I turn next to Amendment 251 in the name of the noble Baroness, Lady Hayman of Ullock, which was spoken to by the noble Baroness, Lady Taylor. Where there is a street vote development order, we of course wish to see the resultant impacts of construction on residents and the local environment minimised. The powers we are seeking would allow the Secretary of State to prescribe in regulations the documents that must accompany a street vote proposal. They could potentially include a code of construction practice. We intend to consult on what these requirements should be as part of the wider consultation on the detail of the measure. Setting out the documentary requirements in the Bill would prevent us considering this, alongside other detailed matters, through consultation.
Baroness Taylor of Stevenage (Lab)
Does the Minister accept that as part of that consultation we should speak to the Local Government Association or other representatives of local government? The drawing up of such codes and so on would almost certainly involve professionals in the planning departments of local authorities. They are at breaking point already—they are greatly stretched—and these street votes can presumably pop up at any time. They will not necessarily be part of a planned workload for local authorities. One of our concerns is that if some of these codes and other things that might be needed to support street votes are not very clear in secondary legislation or the SI that brings it in, it will put an incredible burden on those hard-pressed local authority planning departments. That is probably why the LGA has spoken out so strongly against this proposal, or one of the reasons. If we are going to do some extensive consultation on this before we see secondary legislation on it—which begs the question of why it could not have come in secondary legislation in the first place—that issue needs to be considered.
Earl Howe (Con)
We want to engage in extensive consultation. I have every confidence that the Government will want to garner opinion from sources that have expertise of the kind that the noble Baroness mentions, and I see no reason why the LGA will not be included in that. If I can provide her with greater certainty, I will certainly do so by letter. I will be talking more about the broader consultation process in a minute or two.
The effect of Amendment 253A in the name of the noble Lord, Lord Stunell, would be to exclude development in any area with a designated neighbourhood forum from the scope of street vote development orders. This would mean that, as he explained, street vote development orders could not be used in areas where, I suggest, they would be of most benefit, for example, where local people want more homes, or where greenfield land is under particular pressure from housing development. I reassure the noble Lord that neighbourhood planning will continue to play an important role in the planning system. Indeed, other measures in the Bill reinforce this. Where street vote development orders operate, communities will continue to be able to participate in neighbourhood planning. Indeed, our intended consultation will give neighbourhood planning forums and other interested parties an opportunity to shape the policy and ensure that it delivers for communities.
Lord Stunell (LD)
I thank the noble Earl for giving way. He has perhaps got the cart in front of the horse there. My amendment refers to neighbourhood plans which are in force. It seeks to make sure the decisions the public take on all the issues that he has just outlined as being highly desirable—those which have completed and formed a neighbourhood plan—are not then subject to a further random challenge from a particular street vote. It is not a question of the preparation of a neighbourhood plan; my amendment would not apply in that situation.
Earl Howe (Con)
I take the noble Lord’s point. This highlights again how important it will be to ensure that the results of the consultation reflect issues such as those the noble Lord has raised. It may be that the general feeling is to go along the road the noble Lord has suggested. I do not want to pre-empt the consultation result in that sense, but let me reflect further on what he has said. Again, I will be happy to write to him if I have further wisdom to impart at this stage.
I can understand the reasons for tabling Amendment 254, in the name of the noble Baroness, Lady Hayman, to which the noble Baroness, Lady Taylor, spoke. I do not, however, agree that it is necessary. As a general point, biodiversity net gain will be an important point of the planning system going forward. It will ensure biodiversity must be enhanced when new development occurs and habitats will be impacted. Having said that, my colleagues at Defra have recently published the Government’s response to their consultation on the implementation of biodiversity net gain—BNG. This response makes clear that certain types of development will be exempt from BNG requirements.
The powers in the Bill require regulations to specify the development which can be consented to through a street vote development order. We are likely to use those powers to specify a range of development, from more minor developments such as roof extensions to more extensive development. In line with the wider policy approach, it is therefore likely to be appropriate to exempt some forms of street vote development from BNG requirements. That is why we are seeking the power in the Bill to both modify and exclude BNG provisions under Schedule 7A.
The noble Baroness asked in particular about conservation areas, and I will touch on that. I recognise the important role that conservation areas play in protecting local heritage. Proposals for street vote development orders will be independently examined against a set of prescribed requirements. The importance of local heritage will be taken into account in the design of these requirements. In addition, street vote development orders cannot be used to consent to the development of listed buildings and scheduled monuments.
The noble Baroness, Lady Pinnock, asked about infrastructure and perhaps I could reply to her in this particular context. We recognise that improvements to local infrastructure may be needed to support street vote development. Where street vote development takes place, local authorities will be able to secure value from the new development by charging a specific community infrastructure levy rate targeted at street vote development. This will ensure that value generated by the street vote development can be captured and used to secure infrastructure and affordable housing that will support the local area.
I turn briefly to the issue of whether it is appropriate to seek a delegated power in this case. As Defra’s recently published implementation plans make clear, much of the detailed implementation for biodiversity net gain will be set out in secondary legislation. It is therefore also appropriate to set out the biodiversity net gain arrangements for street vote development orders in secondary legislation to ensure that the systems work in harmony.
I can understand the reasons for tabling Amendment 257 in the name of the noble Baroness; however, I do not agree it is required. Clause 100(3) of the Bill allows for local authorities to expedite the procedure for setting community infrastructure levy rates for street vote development where local authorities do not have immediate plans to update or introduce CIL rates within their authority.
Baroness Taylor of Stevenage (Lab)
The noble Earl has mentioned, a couple of times now, independent examination of street voting. Does that mean the idea is that we will have a whole new round of public inquiry processes for every street vote that is introduced?
Earl Howe (Con)
No, it most certainly does not. Our intention is to appoint the Planning Inspectorate to examine proposals and make the street vote development orders on behalf of the Secretary of State.
Lord Stunell (LD)
I wonder if I could help the noble Earl. For neighbourhood plans, there is an independent examiner who is not actually drawn from the inspectorate but obviously has to be a qualified professional person of independent standing according to an agreed register. I would have thought that, bearing in mind that is a task that is bringing forward a significant number of neighbourhood plans each year and the Government intend to bring forward more, there would be a substantial multiplier effect if street votes go ahead. So the pool of independent examiners may have to be deepened and widened somewhat beyond the Planning Inspectorate if he intends to proceed.
Earl Howe (Con)
That is a helpful suggestion, which I am happy to feed in.
On Amendments 252 and 253, in the name of the noble Baroness, the Government recognise that leaseholders will often have an interest in proposals for street vote development. Leaseholders will be able to be part of a group that can bring forward a proposal for a street vote development order if they are registered to vote in a local council election at an address in the street area on a prescribed date. If a proposal passes examination, a referendum will be held on it. Subject to the outcome of consultation, the Government envisage making a provision so that individuals, including leaseholders, who are registered to vote in the local council election at an address in the street area, as well as commercial rate payers there, will be eligible to vote. Again, we intend to consult on this proposal and on our proposals for referendum approval thresholds as part of a wider consultation on the detail of the measure.
Baroness Pinnock (LD)
I apologise. The noble Earl said that commercial developments in an area would have a vote, but how would they be on the electoral roll? Clause 99 says they would be.
Earl Howe (Con)
It is not that businesses would be on the electoral roll. If I misspoke, what I meant to say was that residents who are registered to vote in a local council election at an address in the street area on a prescribed date will be eligible to vote as part of this arrangement, as well as commercial rate payers in the area.
Baroness Pinnock (LD)
So could Tesco, for instance, have a vote, if there was a little Tesco Express on the street?
Earl Howe (Con)
The intention is that, if there is a commercial business paying commercial business rates, it should be allowed a voice in this process.
Earl Howe (Con)
Yes, and consultation.
Before I speak to the government amendments, I will turn to Amendments 255 and 256, also in the name of the noble Baroness, which deal broadly with issues of propriety. I recognise the valuable expertise that organisations like the Association of Electoral Administrators can bring, but I do not agree with the noble Baroness that it is necessary to place a statutory duty on the Secretary of State to engage with them. As part of our work to develop the detail of the street votes policy for regulations, we will seek a wide range of views, as I mentioned earlier, from organisations such as the Association of Electoral Administrators and the Society of Local Authority Chief Executives to help us to get the secondary legislation right and to ensure that the policy operates effectively. However, it is right that the Secretary of State will be required to consult the Electoral Commission, given its important statutory role to ensure free and fair elections and polls.
Baroness Taylor of Stevenage (Lab)
I hear what the noble Earl is saying. In that respect, our amendment was more to seek the views of the Association of Electoral Administrators about the level of pressure that might be put on those groups—I made this point on planning teams earlier—if they were involved in a number of different referenda in their areas at the same time, for example. These can come out of the blue—we would not know when—so there are issues around how they are resourced to deal with that kind of uncertainty in their workloads.
Two big questions have come out what the noble Earl has said. First, as the noble Lord, Lord Stunell, said, it seems that we are going to have a whole new inspectorate. We had a light-hearted suggestion that it might be called “Ofstreet”, but that is for later determination. Who is going to pay for that inspectorate? Secondly, there is the issue of referendums. Referendums can be quite expensive—we have done them on parking issues in my borough. It costs quite a lot of money because you have to be very careful about how they are done to make sure they are fair. Who pays for those?
Earl Howe (Con)
My Lords, if I may say so, that is a very helpful intervention from the noble Baroness. She raises a number of key points, some of which will no doubt be covered in the consultation, but if I can expand on that I will be happy to write to her.
On Amendment 256, I would like to make it clear that the Government take the potential for conflicts of interest seriously. I am however confident that local authorities and the Planning Inspectorate, both of which we envisage having an important role in the street vote process, have appropriate safeguards in place to minimise conflicts of interest. It is a matter for local authorities to determine their own conflict of interest policies. I have every confidence that all local authorities treat conflicts of interest seriously and have robust procedures in place for both their members and officers. It would not be proportionate to legislate that local authorities publish guidance on managing conflicts of interest specifically on street votes, although no local authority would be prohibited from doing so if they so wished.
Our intention is to appoint the Planning Inspectorate to examine proposals and make street vote development orders on behalf of the Secretary of State. As the independent examiner, the Planning Inspectorate has its own conflicts of interest policy to support the proper and efficient allocation of work. In addition, chartered town planners, who may support residents in preparing proposals, are bound by the Royal Town Planning Institute’s code of professional conduct. This includes provisions to declare and avoid conflicts of interest.
I turn briefly to the government amendments in this group. The Government are committed to ensuring that street vote development is subject to the same principles in relation to environmental impact assessment as development enabled by other routes to planning permission. This is consistent with the Government’s commitment on non-regression of environmental protections. Without amending the Bill, it would be unclear for qualifying groups and relevant bodies how the EIA requirements would apply to street vote development. Amendments 257A, 504H, 504I, 504J and 509A allow for the Secretary of State to make regulations modifying the existing process under the EIA regulations so they operate effectively for street vote development orders. Where development that is consented under a street vote development order is EIA development, it will continue to be prohibited unless an assessment has been carried out and the environmental impacts are considered when making the order. Amendments 248A, 256A and 258A make technical and consequential provision to the Town and Country Planning Act, the Planning (Listed Buildings and Conservation Areas) Act 1990 and the Elections Act 2022. These minor changes to these Acts—
Lord Stunell (LD)
I thank the noble Earl for giving way—I realise he has a mammoth task this afternoon. Amendment 258A introduces a new schedule to the Bill. It appears to be five pages long, which raises the total text to some 15 pages. I wonder whether he could say a little bit more about that schedule and what it is attempting to achieve. I am looking at paragraph 1(7), which is obviously difficult to interpret because it inserts bits into other legislation. Maybe he would like to write to me about this. Really quite important stuff is being parachuted into the Bill, on top of all the uncertainty we have been discussing. I wonder whether he would like to sketch in how the new schedule, which I suppose is going to renumbered as Schedule 8, fits into the general structure of this clause.
Earl Howe (Con)
I appreciate the noble Lord’s question and his interest in that amendment; I understand why he felt he should have asked the question. My advice is that, despite its size, this additional schedule represents a minor and technical change, which is necessary to ensure the effective operation of the street votes process and to ensure that it is integrated into the wider planning system. However, I am happy to write to him with further and better particulars.
I hope that the Committee will feel more comfortable with the provisions as I have explained them, and that the government amendments will be accepted when they are reached.
Baroness Pinnock (LD)
Near the beginning of my speech, I asked the Minister if he would be able to define a street. Could he do so now?
Earl Howe (Con)
I am so sorry I omitted to reply to the noble Baroness; I will write to her. It is a question I ask officials myself. It is an issue which will be decided in the consultation because, as she rightly said, there will be instances where a street, as such, does not exist. For example, you might have a small community of houses where the owners or residents may wish to apply under this procedure. In short, this is an issue to be determined under the consultation.
Lord Young of Cookham (Con)
My Lords, the hour is late, and we are less than half way through the targeted groups for the day, so I will be as brief as I can in winding up this fairly lengthy debate. I note that all those who spoke to their amendments had at some point held elective office, either as councillors or in other place—and, in some cases, both. That may explain the lukewarm—I think that is the best adjective I can use—reception for this proposal. The conclusion I draw from this is that the role of a think tank is to think and to come up with radical policies; the role of government is not to fast-track those into primary legislation but to subject them to critical scrutiny and consultation, and then progress to the next stage. The more I listened to the debate, and the more I heard my noble friend the Minister use the word “consultation”, the more I have come to the conclusion that, while I said in my opening speech that this was a policy in the process of gestation, it is in fact the size of a pinhead, as far as I can see, when it comes to movement towards delivery.
I will now pick up some of the points raised. The noble Baroness, Lady Taylor, struck a note of caution about the policy and agreed with me that it was okay to have street votes as a process of feeding into the formulation of a district plan, but she wanted more clarity and asked for assurances about conservation areas for which an assurance was not given. She asked relevant questions about the role of tenants, voting thresholds and declaration of interests. As I understand it, a short-term tenant will have a vote, but the owner, who is not in the property at the moment, will not. There are a lot of issues behind entitlement to vote, which I will come to a moment.
I suspect that the noble Lord, Lord Stunell, was a Minister in the DCLG in 2010, when the Prescott policy of not-so-gentle densification was overturned—his head is stationary, so I do not know whether he was or not; now it has moved vertically, indicating that he was indeed in the department then. He made the point—I will come to it in a moment—about the priority of the neighbourhood plan. One of the worrying things that my noble friend the Minister said in his reply was that, where a neighbourhood has gone through the whole process of consultation, and has developed and had approved a neighbourhood plan, and then within that neighbourhood a street comes up with a proposal which is in conflict with it, the street vote has priority because my noble friend was unable to accept the amendment.
The same applies to my amendment. When one has gone through the whole process of formulating a district plan, residents throughout the district feel confident in the outcome. They then find that it can be overturned by a street vote. The noble Baroness, Lady Pinnock, again highlighted the potential for neighbourhood conflict, which is one of the things that really worries me about this. I am grateful to my noble friend the Minister, whose patience and tolerance have been extended to the extreme over the past hour and a half. I note that he did not reply to the points that I made about the DPRR report, which made some scathing criticisms and suggested that whole sections of this Bill should be removed. Nor did he indicate when the Government might reply to that report.
My noble friend said that the street vote could go ahead with the support of residents, but we do not know what is meant by “support” or “residents”. As I read it, there will have to be an assessor; it will have to go through a process. My understanding is that an inspector—probably from the Planning Inspectorate—would be appointed to assess it. We did not get an answer to the question of who pays for the PINS inspector who is going to assess the proposal. The ratepayers will have a vote, but it is not quite clear who will exercise that vote on behalf of the business. If there is one very small business and one huge business, do they both have one vote? Who exercises it?
The conclusion that I draw from this is that the best thing for the Government to do is to drop this clause. Frankly, the Bill is far too long; this is not urgent; there is no great demand for it. That was quite clear from what my noble friend said whenever he was asked a question: “This is subject to consultation”. We should have had the consultation before we had the legislation. Although I will withdraw my amendment, I suspect that if I did not, I would win the vote quite comfortably on the basis of the exchanges that we have had so far. In the meantime, however, I thank all noble Lords, and particularly my noble friend. I beg leave to withdraw my amendment.
Baroness Scott of Bybrook
“(i) an Authority election, where any part of the street area to which the street vote development order would relate is within the City of London, or(ii) an election of councillors of any relevant council (other than the City of London) any part of whose area is within the street area to which the street vote development order would relate,”Member's explanatory statement
This amendment amends the conditions for an individual to be part of a “qualifying group” for the purposes of new section 61QB of the Town and Country Planning Act 1990 (as inserted by clause 99), to remove the overlap in cases where any part of the street area to which the street vote development order would relate is within the City of London (which is also a “relevant council” for the purposes of the 1990 Act).
Baroness Scott of Bybrook
“(3) Schedule (Street votes: minor and consequential amendments) contains minor and consequential amendments in connection with this section.”Member's explanatory statement
This amendment introduces a new Schedule which makes minor and consequential amendments in connection with Clause 99 (street votes).
Baroness Scott of Bybrook
“Street votes: modifications of the Town and Country Planning (Environmental Impact Assessment) Regulations 2017The Secretary of State may by regulations make provision modifying the application of the Town and Country Planning (Environmental Impact Assessment) Regulations 2017 (S.I. 2017/517) in relation to the grant of planning permission by a street vote development order.”Member's explanatory statement
This amendment provides a power to modify the application of the Town and Country Planning (Environmental Impact Assessment) Regulations 2017 in relation to the grant of planning permission by a street vote development order.
Baroness Pinnock
“(aa) residents of the local area who may be affected by the application, and”Member's explanatory statement
This amendment would require the Secretary of State to consult local residents before determining an application under this section.
Baroness Pinnock (LD)
My Lords, my Amendment 257B is to Clause 101, by which the Government will centralise to the Secretary of State some of the most important planning decisions that will be taken in any locality. The example that I will use is that of the proposed use of former airfield accommodation for housing asylum seekers. I do not want to debate the principle of that today—it is a proposal by the Government. What I am interested in, and concerned about, is the proposal from the Government as to how such a decision will be made. This relates to some of the most important planning applications that will ever occur in a locality. As we have heard over the last few meetings of this Committee, there is a well-thought-through, well-laid-out and well-understood—on the whole—planning process to determine applications either for a new development or a change-of-use development. The proposal here is to try to bypass that, because it would be difficult.
We live in a democracy, and the whole purpose of a democracy is for the voice of the people to be heard and for decisions to be made, having heard the voice of the people—of residents. I feel really strongly about this. In my experience, the worst thing that happens in a locality is when somebody in authority tries to impose a solution. It never works—and the experience of the Government so far shows that this will not work. The proposal for Linton-on-Ouse airfield in North Yorkshire to be used for accommodation for asylum seekers had to be fairly rapidly rescinded because of local objections. There is a way of doing things—and, yes, it takes time, but time is a healer. It gives a way of hearing voices that are, at first, perhaps angry, but can then be made less angry, or perhaps even ameliorated, through discussion and hearing both sides of a proposal.
Currently what happens with any planning application, but particularly big planning applications is that, first, it is notified in a formal way and word gets round in informal ways. A timetable is laid out for how the planning application will be considered, including a period in which objections can be made by local people. Then there is an opportunity at a meeting of the planning committee to hear the proposal and any objections. I think that most planning committees now allow, and encourage, members of the public to speak to the committee so that their voices and concerns can be heard. If planning officers are involved, one of their skills is to try to find a way through a difficult proposal by hearing the voices of those who live in the locality and of the planning proposal applicant. They try to find a way through so that, while nobody will be totally satisfied, there is less dissatisfaction. The decision is made in an open way—it is webcast, these days, well reported and understood—and a list of planning conditions are laid out so that all the issues that local people are concerned about can be addressed.
Baroness Hayman of Ullock (Lab)
My Lords, I thank the noble Baroness, Lady Pinnock, for introducing her amendment. We agree with everything she has just said. I am also objecting to Clause 101 standing part of the Bill, because we are very concerned about the implications of this clause. We have also put down an amendment to probe whether guidance will be published on Clause 101, but our major concern is with the clause itself.
As we have heard from the noble Baroness, Clause 101 inserts new sections into the Town and Country Planning Act to provide for two new routes to apply for planning permission for the development of Crown land in England. In other words, we are talking about land where there is a Crown or Duchy interest. In the case of either route, the provisions in the clause will allow the appropriate authorities to apply for planning permission direct to the Secretary of State, rather than being subject to the same requirements and application processes as anyone else wishing to undertake development. In such circumstances, the Secretary of State must notify the local planning authority whether they intend to decide the application. If they decide to determine it themselves, they can approve it either conditionally, or unconditionally, or refuse it. They will also have to consult the local planning authority, to which the application would otherwise have been made, but the authority will have no right to veto it.
What does the policy paper that sits alongside the Bill say? It says that it is a means to
“provide a faster and more effective route for urgent and nationally important Crown development”.
That sounds all well and good, but, like the noble Baroness, Lady Pinnock, we are also concerned about the implications of introducing such an open-ended measure. This is regarding both removing appropriate and necessary limits on the exercise of executive power and denying communities a chance to express their views about development in their area and their ability to indicate either consent or opposition.
We fully appreciate that there will be emergency situations where it is necessary to speed up the planning application process for essential development. Off the top of my head, I can think of the Nightingale hospitals during the Covid pandemic. However, the broad scope of the provisions in the clause, which do not provide for any limit on the type of development that can be approved directly by the Secretary of State, or in what circumstances, means that they could be used for a much wider range of proposals.
This could include a number of circumstances, but I would like to focus on one in particular, as did the noble Baroness, Lady Pinnock. The Committee will know that the Government have opened centres to provide accommodation for asylum seekers and are looking to open further such centres. I would like to thank Asylum Matters, Medical Justice, the Helen Bamber Foundation and Ripon City of Sanctuary for their helpful briefings. The Government have, as the noble Baroness said, consistently sought to avoid public scrutiny of and consultation about the construction or operation of large-scale institutional facilities for asylum accommodation.
The Home Office has previously successfully opened such facilities on ex-military sites at Coltishall in Norfolk—which is now closed, despite an attempt to reopen it—Napier in Folkestone, which is still open, and Penally in Pembrokeshire, which is now also closed. It has further made attempts, despite local opposition, to construct or operate similar facilities in Barton Stacey, Hampshire, in a facility on the Yarl’s Wood Immigration Removal Centre site in Bedfordshire and, from April 2022, as was mentioned by the noble Baroness, at an ex-military base in the rural village of Linton-on-Ouse, North Yorkshire. All these projects have been the subject of intense controversy and, in the cases of Napier and Penally, legal challenge over the profound harm to people seeking asylum, as well as the lack of government consultation of local communities and the resulting impacts on community cohesion.
At both Yarl’s Wood and Linton-on-Ouse, pre-action correspondence was issued, and the developments were halted prior to judicial review. At Penally, the Secretary of State for Wales stated that he first had discussions with the Home Secretary about use of the site just nine days before it opened, and the local health board was informed three days prior. At Napier, the local council, local MP and local and district councillors wrote to the Home Office to protest that they had been given
“very little notice of the decision”
to open the barracks and that it was
“one they could not support”.
A similar lack of consultation occurred at Barton Stacey and at Yarl’s Wood. In the case of Napier, planning permission for the facility was initially secured under class Q emergency development rights for six months, subsequently extended to 12. The Secretary of State granted herself permission to use Napier Barracks for a further period of five years, without any public consultation, through the unusual procedure of using delegated legislation.
The Government’s approach has been criticised by your Lordships’ Secondary Legislation Scrutiny Committee, which raised concerns that the Town and Country Planning (Napier Barracks) Special Development Order 2021 had been laid while Parliament was in recess and that “insufficient information” had been provided by the Government about these developments.
After the fact, the Home Office ran a public “consultation” on the change of use of the site. But this cannot be considered a meaningful consultation, as it took place after permission had been extended. The planning statement that was issued at this time included a commitment to complete a statement of community involvement. This has still not been published, despite the consultation closing at the end of January last year. Perhaps the Minister could give an update on that.
In a judgment handed down on 24 June last year, the High Court ruled that the decision to grant planning permission for a further five years was unlawful. The judge ruled that there was a failure to have proper regard to the public sector equality duty and that the development raised
“very obvious issues … in particular relating to … potential victimisation and harassment … and the fostering of good relations”.
Lack of consultation by the Government has had serious effects on community cohesion in places where large-scale institutional sites have been contemplated. Last April, the Government announced their intention to move towards a system of large-scale permanent asylum accommodation centres in which to place people seeking asylum who would otherwise be destitute, while they await a decision on their claim. The flagship announcement of a facility to accommodate 1,500 people seeking asylum on the ex-RAF base at Linton-on-Ouse, which we have mentioned, was made without any reference at all to the local community, the parish council, the district council, the police and crime commissioner or local police and health services. An initial justification for this was that it was part of a bigger series of announcements.
Current planning laws and, in particular, the right of local residents to be heard on decisions which affect them have proved a barrier to government attempting to institute these large-scale accommodation facilities. Our concern is that the powers provided for in this clause are to facilitate the driving through of centres regardless of their impact on the people placed in them or the local communities in which they are situated. They allow government to totally bypass local councils on asylum accommodation. This is completely the wrong approach. We believe it should be a legal requirement to consult local authorities on asylum accommodation locations.
Appropriate safeguards must be added into the clause to ensure that there are limits to the use of these powers and that minimum requirements are in place to secure some measure of consent from affected local communities. Without a firm commitment that such safeguards will be introduced at a later stage, we believe that Clause 101 must be removed from the Bill.
Lord Hodgson of Astley Abbotts (Con)
My Lords, I have not participated in this Bill so far. I arrived today thinking seriously about the matter of principle in the powers given to the Government by Clause 101, and with some sympathy for the ideas behind Amendments 257B and 258ZA. I am disappointed by the way in which both noble Baronesses have spoken to them, moving away from the principle of the way in which the Government have powers to a discussion about immigration policy and the use of asylum centres. That is a much narrower issue; it will come out of this, but it gets away from the principle of the Government having undue powers for whatever reason. Moving on to something highly controversial and difficult at this stage muddies the water in a way that is unhelpful for those of us who think that Clause 101 contains undesirable powers.
The noble Baroness referred to the Secondary Legislation Scrutiny Committee, which I chaired during the Napier barracks statements. We have seen the Government push the envelope, in particular during the pandemic. The noble Baroness, Lady Bakewell of Hardington Mandeville, will recall some of this as a former member of the committee. Things such as permitted developments were pushed out in response to the needs of the pandemic. I understand that; emergency statements needed to be taken and things needed to be done quickly.
We saw the impact of that in many ways, but most obviously in our having restaurants in the street, which was needed at the time because otherwise they would have had to close due to social distancing. We on the SLSC were content about this because there was a sunset clause built in. However, a year later it was removed by another piece of legislation. By two steps, the Government moved from one position to another with minimal scrutiny from your Lordships’ House and the other place. That is the issue I am interested in exploring in this clause, rather than involving ourselves in discussions about immigration, which will take us back to all sorts of difficult areas that will not help the development of the argument.
The Government said in response to our concerns about making these permitted developments permanent that we were semi-killjoys, trying to stop restaurants in the street and so on, but the reality is that they were controversial for mothers with buggies, pallet truck drivers, people with limited vision and, above all, people who lived above them—all of us talk rather louder and laugh a bit more when leaving a restaurant at 11 pm having had a few glasses of wine, so people found their children being kept awake and so on.
The Earl of Lytton (CB)
My Lords, it is a pleasure to follow the noble Lord, Lord Hodgson of Astley Abbotts. My concern is to do with not the specific examples referred to, but that we seem to be in a situation where we are asked to confer an unconstrained power in relation to an undefined objective. The undefined objective is “national importance”, and I have not been able to find a definition of what that might be. I suppose you would say that I might ask from these Benches: is the national importance clearly distinguishable from the political aspirations of the Government of the day? Is it something different? I would want to know because I would not want to confer a power without having a very clear sense of purpose.
We turn to the matter of “urgency”—not emergency, I stress, but urgency. We need to understand what that amounts to. It may be irksome to Governments of the day—the more centralist and command economy-type the thinking, the more irksome it becomes—to go through hoops to do with projects that involve Crown land. But it is the price of democracy, and the price of the maintenance of the rule of law and the continuation of what might be regarded as the rules-based system. That demands a degree of consistent approach. Without having some definitions in the Bill, it is difficult to see how there could be any consistent approach here, as opposed to one based on whim.
Some of the examples that the noble Baroness, Lady Hayman, produced in her excellent introduction made it look like Government gaming the system, and that worries me very greatly because it is not just the Government that may be here today, but one tomorrow or in future years, and perhaps—who knows?—one that is more extreme of right or left; I say not which. I get back to the rules-based system. Are we in that environment or are we getting into the area where anything goes?
I mention the following because I do not want it to be used as the lever by the Minister when he comes to reply. Wrapped up in the middle of page 123 of the Bill, in new Section 293B(11), is the provision for matters of national security and public disclosure that would be
“contrary to the national interest”.
I get that, and I do not have any principled objection to it, subject to adequate definitions and safeguards. I want to know how “national importance” and “national interest” interface for a start.
Going over the page in the Bill, page 124 states, in new Section 293C(3), that:
“A development order may make provision as to the consultation”—
“may”, but does not have to. That cannot be an entirely optional extra at the whim of whichever Secretary of State happens to be in power at the time. Still on page 124, new subsection (8) states:
“The following provisions do not apply for the purposes of determining an application … sections 66(1) and 72(1) of the Planning (Listed Buildings and Conservation Areas) Act”.
Section 66(1) is in relation to the desirability of conserving and protecting listed buildings, and Section 72(1) is effectively the same but for conservation areas. But when the Bill says:
“The following provisions do not apply”,
they clearly do not apply to anybody, not even the Secretary of State. The Secretary of State is, in other measures, asking the general citizenry to comply with precisely the same burdens that they decide, on a whim, that they are going to relieve themselves of. I am behind the noble Baroness, Lady Hayman, because this is just not good enough.
Lord Berkeley (Lab)
My Lords, I rise briefly to support my noble friend Lady Hayman, who performed an excellent destruction of this clause. Other noble Lords have said much the same thing. I have one question for the Minister, because this is all about the Crown, but I cannot see any definition in the clause of who “the Crown” is. There are other definitions in other parts of the Bill, which include the Duchy of Cornwall, which I shall come on to in the next amendment, the Duchy of Lancaster, and the Crown Estate. It makes me think that what we are really trying to do is to go back to a time when we had “the Crown” in the shape of Henry VIII, who could do more or less what he wanted. This seems a very good start to the Government’s plan to give Henry VIII, in the shape of whoever is in charge at the time, carte blanche to do what they want.
Lord Lansley (Con)
My Lords, I am glad to follow the noble Lord, Lord Berkeley. Before we hear from my noble friend, I want to say that Section 293 of the Town and Country Planning Act 1990 defines what is Crown land and goes on to make it clear what is an appropriate authority for the purposes of what is being introduced in Section 293B, down to and including,
“in relation to Westminster Hall and the Chapel of St Mary Undercroft … the Lord Great Chamberlain and the Speakers of the House of Lords and the House of Commons acting jointly”
being the appropriate authority.
I want to ask my noble friend about something because I simply do not understand it. There is an existing Section 293A, which as it stands is called “Urgent Crown development: application”; it has almost the same name as new Section 293B. I completely understand that the existing legislation does not appear to include all the provisions relating to how the Secretary of State deals with such an application and how the Secretary of State might give permission, so it is probably defective. But then I do not understand why all this is being added in and Section 293A is not being repealed. Perhaps my noble friend can explain that to me.
Earl Howe (Con)
My Lords, looking first at this clause as a totality, I will begin by explaining briefly the purpose of the proposed measure. The purpose of Clause 101 is to update the existing provisions for development by the Crown that is of national importance and required urgently by providing a new, faster, more effective and efficient route for seeking planning permission. It also provides a new route for nationally important development that is not urgent. The objective of these reforms is to ensure that planning decisions can be made in a timely and proportionate way on development that is of national importance and is promoted by the Crown.
Let me banish what I have perceived from this debate is a misconception. A special urgency procedure for urgent and nationally important Crown development has existed in legislation for many years. The purpose of the clause is to update this route so it can be used more effectively to deal with urgent national crises and supplement it with a new route for making a planning decision for non-urgent planned Crown development which is of national importance.
The Government believe that, where a Crown development is of genuine national significance, the Secretary of State, who is democratically accountable to Parliament, should be able to make a planning decision rather than an individual local planning authority answerable to its local community. The Secretary of State is best placed to take a national, balanced and impartial view of the need for development.
Let me explain that nationally important but non-urgent applications will still be considered against the plan-led approach we advocate through the Bill, and local communities will be given their opportunity to give their views and have these taken into account. Again, there is precedent for this type of approach within Section 62A of the Town and Country Planning Act, where planning applications can be submitted directly to the Secretary of State. It is thought that this route would be suitable for development such as new prisons and extensions to the defence estate.
All sorts of hares have been set running on this provision, and it is most important for me to emphasise that the urgent route that we are introducing would be used sparingly where—and only where—it can be demonstrated that development is needed urgently and is nationally important. Those are high bars, but the route could, for example, be used for development needed on Crown land to develop medical centres in the event of a pandemic. Such development will need to be operational in a matter of weeks so decisions can be made very quickly. Other examples could include accommodation needed urgently in the event of a future influx of refugees, or military training facilities.
I was grateful to my noble friend Lord Hodgson for at least part of what he said, if not for all of it. Press reports have been misleading on the issue of housing illegal migrants. As I have said, the power can be used only for Crown development which is of both national importance and needed urgently. As I have said, this is a high bar, and Crown bodies making an application will need to justify that using this route is appropriate.
This does not concern any situation that we may currently be facing on illegal migrants. In the first place, it is worth bearing in mind that this power will not take effect straightaway, contrary to reports in the press. The Bill needs to finish its passage through Parliament and then we will need to lay regulations and produce guidance before this can properly be brought into force. That will take time. To this end, it may not be a suitable route for the immediate issue of housing of migrants to address the current immigration backlogs. In the case of asylum accommodation on MoD bases, it will be for the Home Secretary to decide whether to bring forward an application when the powers are in place.
We recognise that the procedure for this urgent route is not the same as the more commonly known statutory procedure for determining planning applications. It is therefore, I say again, a route that will be used sparingly. I say to the noble Earl, Lord Lytton, that those promoting the development must clearly demonstrate that there is an urgent need for the development, that timely decisions cannot be delivered by other planning routes and that it is therefore in the wider public interest that the planning decision is accelerated using the new procedure.
Baroness Pinnock (LD)
I thank the Minister for his careful response to the concerns that have been raised. I said at the outset that I understand that some planning decisions must be made rapidly in the national interest.
However, unrestrained power for an undefined purpose of national importance, as the noble Earl, Lord Lytton, said, is at the heart of this. The Executive are taking too much power without being clear on why an urgent decision is needed. If the Government had come forward with a speeded-up process for urgent decisions, shortening the planning process because something is urgent but still enabling people to have their voices heard, I would be more inclined to support that, but not them just saying that, basically, the Secretary of State can make the decision.
I end with this because it is near—well, nearish—me. Linton-on-Ouse was an abject failure of this process. A decision was made to use that accommodation. Nobody was asked, nobody was told. Lots of people said, “Oh, right, we’re not having this then”, as they do in Yorkshire and no doubt do elsewhere. They decided to have a public meeting and put an end to it, and that is exactly what happened, whereas with thoughtful, informed decision-making, the Government may have been able to get to a solution. The Minister’s proposal that this is the only way to get a timely, proportionate, faster and more effective route has not been borne out in practice.
I get upset when the phrase “illegal migrants” is used. The people coming across the channel are asylum seekers. If some of them have their asylum applications refused, they will at that point be illegal migrants, but otherwise they are asylum seekers.
I beg leave to withdraw the amendment.
Lord Berkeley
“Application of TCPA 1990 to the Duchy of Cornwall(1) Section 293 of TCPA 1990 (application of Act to Crown land: preliminary definitions) is amended as follows.(2) In subsection (1), in the definition of “Duchy interest” omit “or belonging to the Duchy of Cornwall”.(3) In subsection (2), omit paragraph (d).(4) In subsection (3B), omit paragraph (b).”Member's explanatory statement
This amendment is intended to provided that for the purposes of planning law the Duchy of Cornwall is treated as any private sector entity.
Lord Berkeley (Lab)
I rise to speak to Amendments 258 and 504GJI in my name. Both refer to issues to do with the Duchy of Cornwall. As the Minister will probably know, I live on the island of Bryher in Scilly, and I have been challenging the Duchy of Cornwall on many things for a number of years, including one or two Private Member’s Bills, which only got so far.
Things move on. We have a new Duke of Cornwall, and I welcome him, but if one looks at the website of the Duchy of Cornwall and at much of its publicity, it emphasises that it is in the private sector. My argument is that if you are in the private sector, you have to behave as any other company, estate or whatever that exists in the private sector. Sometimes that is maybe good for the tenants, sometimes it may not be. I will not get into all the other issues that may be affected by changes in the personnel there, but there are two issues that I want to cover tonight.
The first is in Amendment 258 on the application of the Town and Country Planning Act to the Duchy of Cornwall. In other words, why should the Duchy get special treatment for planning applications and everything when other similar organisations do not? That comes back to the question that we had just had now, which is who is the Crown? It is a difficult one. I do not think that the Minister answered my question on this in the previous group. I am sure that he will have a go at doing it again. There are the Crown Estates, which are doing very well in the offshore field, as well as everywhere else, bringing in lots of revenue, and the Duchy of Lancaster and the Duchy of Cornwall. All of them, apart from the Duchy of Cornwall, are effectively arms, shall we say, in the relationship between the Crown and the Government and in the financial arrangements and control that the Treasury has.
However, the Duchy of Cornwall is slightly different, so in addition to my suggestion that it should not have any special treatment when it comes to planning applications—which affect a lot of people on the Isles of Scilly, in Cornwall and probably in other places as well—there is leasehold reform, which we have been debating for about five years. I have a lot of friends who are leaseholders who want to buy their freehold from the Duchy. It affects many people on the islands and probably on the mainland as well. We have had some very interesting and useful documentation on this. The last major one was the Law Commission’s report on leasehold enfranchisement, which I thought was excellent. I sent in lots of evidence and a lot of other people did. It came up with a very good report in July 2021 recommending the right to buy for many people. I am not going to read out all its recommendations, but they were wide ranging and, I think, generally welcomed by leaseholders.
However, the Duchy argued that it should be exempt from any right to buy on the Isles of Scilly and the off-islands and on certain buildings on the mainland and elsewhere. Its reason was that the areas where these buildings were located were of such enormous importance to the environment and the quality of the life there that it should not be left to the local planning authority to decide whether a lease should be able to be converted into a freehold.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank my noble friend Lord Berkeley for once again using his very detailed, particular knowledge and expertise of issues around the Isles of Scilly and Cornwall. As ever, we are grateful to him for speaking up for those communities. The question he asks is an important one: why should anybody be exempt from proposals in this Bill, never mind the Duchy of Cornwall?
I will start with Amendment 504GJI on leasehold. We have had long and protracted discussions around leasehold in the course of discussions on this Bill previously. My noble friend Lord Berkeley referred to the Law Commission report on leasehold and the recommendations that people should be able to buy out freehold. I cannot see any reason that Law Commission report has not been acted on, and I hope the Minister will be able to enlighten us about that.
Certainly, it does not seem to us that there should be exemptions that sit outside of that for any reason. If the Law Commission has looked closely at the rationale for the exemptions that were put forward by the Duchy and not found those to be reasonable, it seems that the Government should treat the Duchy of Cornwall in the same way as they treat everybody else. As we have heard the Secretary of State say number of times now, if the Government intend to end the feudal leasehold system, will the Duchy of Cornwall be exempt from that, too, or will the Duchy of Cornwall’s properties be included in that legislation? If the Minister cannot provide the answer today, I am happy to take an answer in writing to that question.
My noble friend Lord Berkeley was kind enough to provide information about the issue related to the Isles of Scilly steamship company to us in advance of today’s session, and the point that he makes is a very valid one. For the communities on the Isles of Scilly, this really is an issue of levelling up. He has given us information on the very steep fare increases on that steamship company, and I understand the fare is now some £89. People on the Isles of Scilly will need to use that service. Their choice is either to travel by air, which we do not want to encourage, or to use this steamship company. A strange situation has developed here; it is a situation that I wish I had had in my borough, where when you find you have to go into competition to deliver something if you use government funding, you suddenly find, after 10 years of asking for government money, that the money has appeared miraculously. That does seem a very strange situation. There needs to be close attention to the way these issues are treated. They are issues of levelling up, because communities on the Isles of Scilly want to know they are being treated in the same way as other communities in the United Kingdom. I support my noble friend Lord Berkeley’s amendment.
Earl Howe (Con)
My Lords, I will start by addressing Amendment 258 and then move on to Amendment 504GJI, tabled by the noble Lord, Lord Berkeley. Amendment 258 would remove land in the Duchy of Cornwall from the definition of “Crown land”, as part of planning law. The noble Lord asked what the definition of “Crown land” was, and I apologise for not answering him in the previous debate. It is set out in Section 293 of the Town and Country Planning Act 1990, as my noble friend Lord Lansley rightly indicated in the last debate. It is, broadly, land in which there is a Crown or a Duchy interest—I shall expand on that in a second. I appreciate that the noble Lord tabled a number of Private Member’s Bills concerning the treatment of the Crown and the Duchy of Cornwall, and I admire his tenacity in this regard.
For the benefit of the Committee, I will set out some factual and historical background. For a long time, the Crown was not subject to planning control, but, in 2006, provisions within the Planning and Compulsory Purchase Act 2004 made it subject to planning permission, subject to special modifications. These recognise not only the unique nature of operational Crown land—prisons and military bases, for example—but the uniqueness and importance of the royal estates.
It is important first to understand the complex status of the Duchy of Cornwall. The title “Duke of Cornwall” and the inheritance of the Duchy were created in 1337 by a charter that carries the authority of an Act of Parliament. By virtue of that charter, the Duchy vests in the eldest son of the sovereign, also being heir apparent. Where there is no son and heir, the estate reverts to the Crown. Craies on Legislation notes:
“That is why … the Crown’s prerogative attaches to the lands of the Duchy of Cornwall, for the reason that they never entirely cease to be Crown lands”.
In short, there is always the possibility of the Duchy reverting to the sovereign, as his or her property. For this reason, the Duchy never entirely ceases to be Crown lands. For example, in recent times, King George VI had no son, so, on his accession, there was no Duke of Cornwall and the Duchy remained with King George VI.
Removing the Duchy of Cornwall from the definition of “Crown land” within Section 293 of the Town and Country Planning Act risks disrupting this well-established constitutional arrangement. This could open widespread implications for not just planning but how the Duchy is treated in law more widely. I have enormous respect for the noble Lord, but I am not sure that it is appropriate to open up this debate as part of the Bill. From his previous experience, he will appreciate that it would not be right for a single individual or party to seek to change the law on the way the Duchy of Cornwall is treated. If that is done at all, it has to be done with cross-party support. In addition, a Bill affecting the Duchy requires the King’s consent and sometimes also the Prince’s consent. For the reasons I set out, the Government have no intention to change the definitions of “Crown land” at this time, especially where this concerns changes that could affect His Majesty’s hereditary rights.
Amendment 504GJI addresses the impact that recommendations in the Law Commission’s 2020 report on enfranchisement would have on the Government’s levelling-up and regeneration objectives, including for leaseholders on land owned by the Duchy of Cornwall. The Government are committed to making it easier and cheaper for leaseholders to purchase their freeholds and extend their leases, and we are grateful to the Law Commission for its detailed report on enfranchisement reform. This report addressed a range of matters relating to the qualifying criteria for enfranchisement and lease extensions, including the applicability of these to leaseholders of the Crown, the Duchy of Cornwall and the Duchy of Lancaster. In January 2022, the Government consulted on Law Commission proposals that would improve access to enfranchisement and the right to manage. I am sure that the noble Lord will appreciate that this is a long-term and complex reform programme with many interdependencies, and it will take time to get the detail right. Once it is enacted, the effect will be felt for generations, so we are determined that this work consider all the implications with care.
Lord Berkeley (Lab)
I am grateful to the Minister for giving us a very interesting history lesson, which I certainly knew about but maybe other noble Lords did not. As he said, this goes back to 1300 or thereabouts, when the Duchy started. Yes, it would cause trouble to make changes; however, there has to be a debate about the Duchy land. Is it in the private ownership of the Duke of Cornwall, or it is in what you might call state ownership, alongside the Crown Estates and the Duchy of Lancaster?
When the Law Commission report came out a couple of years ago, I wrote to the Duchy of Cornwall, the Duchy of Lancaster and the Crown Estates to ask whether they were going to implement the recommendations, in particular for their own land. I got really good answers from the Crown Estates and the Duchy of Lancaster. They said they would follow the recommendations, but in a slightly different way. The Duchy of Cornwall could not make up its mind. It is seen to be trying to be different, and I do not quite know why, because I love it dearly. It is something that probably ought to be looked at, but I will not go any further on that this evening.
There is a democratic deficit, and if the Minister is saying we are going to go ahead and try to complete the process, which I certainly welcome, how is the democratic input from the Duchy of Cornwall’s residents and others, such as stakeholders, going to be put in?
We have had a very interesting debate and I thank the Minister for his helpful answers, and on that basis, I beg leave to withdraw the amendment.
Baroness Scott of Bybrook
“ScheduleStreet votes: minor and consequential amendmentsTown and Country Planning Act 1990
1 (1) TCPA 1990 is amended as follows.(2) In section 5 (the Broads), in subsection (3), for “61Q” substitute “61QM”.(3) In section 56 (time when development begun), in subsection (3)—(a) after “(7),” insert “61QI(8),”;(b) for “108(3E)(c)(i)” substitute “, 108(3E)(c)(i), 108(3DB)(c)(i)”.(4) In section 57 (planning permission required for development), in subsection (3), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”.(5) In section 58 (granting of planning permission: general), in subsection (1)(a), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”.(6) In section 62 (applications for planning permission or permission in principle), in subsection (2A)—(a) at the end of paragraph (a) omit “and”;(b) after paragraph (b) insert “, and(c) applications for consent, agreement or approval where that consent, agreement or approval is required by a condition or limitation imposed under section 61QI(1).”(7) In section 65 (notice of applications for planning permission or permission in principle), in subsection (3A)—(a) at the end of paragraph (a) omit “and”;(b) after paragraph (b) insert “, and(c) any application for consent, agreement or approval where that consent, agreement or approval is required by a condition or limitation imposed under section 61QI(1) or any applicant for such consent, agreement or approval.”(8) In section 69 (register of applications etc)—(a) after subsection (1)(cza) insert—“(czb) street vote development orders or proposals for such orders;”;(b) in subsection (2)(b), after “Mayoral development order,” insert “street vote development order or proposal for such an order,”.(9) In section 71 (consultations in connection with determinations under section 70), in subsection (2ZA)—(a) at the end of paragraph (a) omit “and”;(b) after paragraph (b) insert “, and (c) an application for consent, agreement or approval where that consent, agreement or approval is required by a condition or limitation imposed under section 61QI(1).”(10) In section 74 (directions etc as to method of dealing with applications), in subsection (1ZA)—(a) in paragraph (a)—(i) at the end of sub-paragraph (i) omit “and”;(ii) after sub-paragraph (ii) insert—“(iii) a consent, agreement or approval where that consent, agreement or approval is required by a condition or limitation imposed under section 61QI(1), and”;(b) in paragraph (b)—(i) at the end of sub-paragraph (i) omit “and”;(ii) after sub-paragraph (ii) insert “, and“(iii) applications for consent, agreement or approval where that consent, agreement or approval is required by a condition or limitation imposed under section 61QI(1).”.(11) In section 77 (reference of applications to Secretary of State), in subsection (1), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”.(12) In section 78 (right to appeal), in subsection (1)(c), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”.(13) In section 88 (planning permission for development in enterprise zones), in subsection (9), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”.(14) In section 91 (general condition limiting duration of planning permission), in subsection (4)(a), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”.(15) In section 94 (termination of planning permission by reference to time limit: completion notices), in subsection (1), after paragraph (d) insert “; or(e) a planning permission under a street vote development order is subject to a condition that the development to which the permission relates must be begun before the expiration of a particular period, that development has been begun within that period, but that period has elapsed without the development having been completed.”(16) In section 108 (compensation)—(a) in the heading, for “or neighbourhood development order” substitute “, neighbourhood development order or street vote development order”;(b) in subsection (1)—(i) in paragraph (a), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”;(ii) in the words after paragraph (b), for “or the neighbourhood development order” substitute “, the neighbourhood development order or the street vote development order”;(c) in subsection (2), for “or a neighbourhood development order” substitute “ , a neighbourhood development order or a street vote development order”;(d) in subsection (3B)—(i) in paragraph (ba), at the end omit “or”; (ii) after that paragraph insert—“(bb) in the case of planning permission granted by a street vote development order, the condition in subsection (3DB) is met, or”;(e) after subsection (3DA) insert—“(3DB) The condition referred to in subsection (3B)(bb) is that—(a) the planning permission is withdrawn by the revocation or modification of the street vote development order,(b) notice of the revocation or modification was published in the prescribed manner not less than 12 months or more than the prescribed period before the revocation or modification took effect, and(c) either—(i) the development authorised by the street vote development order had not begun before the notice was published, or(ii) section 61QI(8) applies in relation to the development.”(17) In section 109 (apportionment of compensation for depreciation), in subsection (6), in the definition of “relevant planning decision”, for “or the neighbourhood development order” substitute “, the neighbourhood development order or the street vote development order”.(18) In section 171H (temporary stop notice: compensation), in subsection (1)(a), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”.(19) In section 264 (cases in which land is to be treated as not being operational land), in subsection (5)(ca), for “or a neighbourhood development order” substitute “, a neighbourhood development order or a street vote development order”.(20) In section 324 (rights of entry), in subsection (1A)—(a) the words from “the reference” to the end become paragraph (a);(b) after that paragraph insert “, and(b) the reference to a proposal by the Secretary of State to make any order under Part 3 includes a reference to a proposal submitted (or to be submitted) to the Secretary of State for the making of a street vote development order.”(21) In section 333 (regulations and orders)—(a) after subsection (3) insert—“(3ZZA) Subsection (3) does not apply to a statutory instrument containing regulations made under any of sections 61QB to 61QJ or section 61QL if a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”;(b) after subsection (3ZA) insert—“(3ZZAA) No regulations may be made under section 61QC(3), 61QH(2) or 61QI(5) unless a draft of the instrument containing the regulations has been laid before, and approved by a resolution of, each House of Parliament.”(22) In Schedule 1 (local planning authorities: distribution of functions), in paragraph 6A, at the end insert “or any of sections 61QA to 61QM (street vote development orders)”.Planning (Listed Buildings and Conservation Areas) Act 1990
2 (1) The Planning (Listed Buildings and Conservation Areas) Act 1990 is amended as follows. (2) In section 66 (general duty as respects listed buildings in exercise of planning functions), in subsection (4), after “orders” insert “or street vote development orders (except as provided by SVDO regulations within the meaning given by section 61QM of the principal Act)”.(3) In section 72 (general duty as respects conservation areas in exercise of planning functions), in subsection (4), after “orders” insert “or street vote development orders (except as provided by SVDO regulations within the meaning given by section 61QM of the principal Act)”.Elections Act 2022
3 In section 34 of the Elections Act 2022 (campaigners), in subsection (6), in the definition of “local referendum”, after paragraph (d) insert—“(e) section 61QE of the Town and Country Planning Act 1990 (referendums on street vote development orders);”.The Conservation of Habitats and Species Regulations 2017
4 (1) The Conservation of Habitats and Species Regulations 2017 (S.I. 2017/1012) are amended as follows.(2) In regulation 75 (general development orders)—(a) in the heading, after “orders” insert “and street vote development orders”;(b) in the opening words, after “2017” insert “or a street vote development order”.(3) In regulation 76 (opinion of appropriate nature conservation body)—(a) in the heading, after “orders” insert “and street vote development orders”;(b) in paragraph (1), after “order” insert “or a street vote development order”;(c) in paragraph (6), after “order” insert “or a street vote development order”.(4) In regulation 77 (approval of local planning authority), in the heading, after “orders” insert “and street vote development orders”.(5) In regulation 78 (supplementary)—(a) in the heading, after “orders” insert “and street vote development orders”;(b) in paragraph (3)(b), after “order” insert “or development order”.(6) In regulation 85B (assumptions to be made about nutrient pollution standards)—(a) in the heading, after “orders” insert “and street vote development orders”;(b) in paragraph (1)(a) after “orders” insert “and street vote development orders”.”Member's explanatory statement
This amendment inserts a new Schedule which makes minor and consequential amendments in connection with clause 99 (street votes).
Lord Lansley
“(5A) Where a subsequent planning permission (Permission B) is for localised changes to a wider development approved in the existing permission (Permission A), which would not have the effect of rendering the implementation of the Permission A physically impossible, the implementation of permission B does not preclude future reliance upon Permission A (in relation to existing or future development) outside of the area to which permission B relates.”Member's explanatory statement
This amendment would support the continuation of “drop-in” permissions in large-scale developments, while maintaining the “Pilkington” principle, that they must not render the original permission physically impossible.
Lord Lansley (Con)
My Lords, I remind noble Lords of my registered interest as chair of the Cambridgeshire Development Forum. This group relates to planning permissions. There are a number of different amendments for different purposes and perhaps noble Lords will forgive me if I speak only to my Amendment 258B, which has a particular purpose. It seeks to provide a clear, statutory provision in relation to an area of planning law that has recently become uncertain and which if not clarified would create a number of costly and difficult consequences both for developers and planning authorities.
I will explain the background. The issue relates to large developments which are built out over a significant period; they are developments which have had a full planning permission. Of course, if development proceeds in phases with outline permission, or with a hybrid mix of outline and full permissions for different phases, the scope for varying a large development can be adjusted over time—but I am talking here about developments with full planning permission. In relation to those, it is clear that variations to that full planning permission are limited. Section 96A of the Town and Country Planning Act 1990 permits variations to a planning permission that are not material. Clause 102 of the Bill seeks to insert into that Act a new subsection (5) stating that planning permission may be granted in relation to an existing permission
“only if the local planning authority is satisfied that its effect will not be substantially different from that of the existing permission”.
That is not quite the same as the existing law; it is a step forward, but a very modest step in that direction. However, the issue is where a developer seeks permission within the boundary of an existing large-scale development for a significant variation to the plan. What happens where two permissions exist together in relation to the same site?
This matter arises in relation to what is known as the Hillside judgment—Hillside Parks Ltd v Snowdonia National Park Authority—to which I will return soon. The Supreme Court judgment was given in November last year, so it is quite recent. In paragraph 28, it said:
“There is … no provision of the legislation which regulates the situation where two or more planning permissions granted for development on the same site are, or are claimed to be … inconsistent. The courts have therefore had to work out the principles to be applied”.
The key case in this respect, up until now, has been Pilkington v Secretary of State for the Environment. I will not dwell on the two bungalows and the smallholding which were the subject of that case. Lord Widgery, in his judgment, stated that the test would consider
“whether it is possible to carry out the development proposed in that second permission, having regard to that which was done or authorised to be done under the permission which has been implemented”.
In a sense, what Pilkington established was the idea that permission could not continue to be valid where it had become physically impossible to implement it by virtue of a subsequent planning permission that has been consented. However, that has tended, over time, to imply that, where it is not physically impossible to fulfil an existing planning permission, it would remain valid, notwithstanding that there is an additional permission in relation to part of the site. So the general expectation has been that, where permissions relate to the same site, the issue is whether the implementation of one renders the other physically incapable of implementation. If it does, the approval of the latter would render the former invalid; if it did not, the former permission would not be invalidated.
I turn now to the Supreme Court judgment of the Hillside case in November last year. An issue for the appellants—Hillside Parks Ltd—was that the Court of Appeal had held that the original planning permission for the whole site could not be interpreted as separable. Paragraph 71 of the judgment of the Supreme Court justices said:
“We agree with the view expressed by the Court of Appeal in this case that where, as here, a planning permission is granted for the development of a site, such as a housing estate, comprising multiple units, it is unlikely to be the correct interpretation of the permission that it is severable”.
Consequently, if a permission were implemented in relation to a part of a larger site, even if the rest of the original permission could be completed, the fact that the whole original permission could not be completed would render the original permission no longer valid.
The problems that arise from this were summarised in submissions to the Supreme Court by counsel for the appellants who submitted that it would cause serious practical inconvenience if a developer who, when carrying out a large development, encountered a local difficulty or wished for other reasons to depart from the approved scheme in one particular area of the site, cannot obtain permission to do so without losing the benefit of the original permission and having to apply for a fresh planning permission for the remaining development on other parts of the site. The Supreme Court justices took the view that that was indeed the legal position: that where a developer had been granted a full planning permission for one entire scheme and wished to depart from it in a material way, it is a consequence of the very limited powers that a local planning authority has to make changes that a full new permission would be required.
I am very grateful to the Home Builders Federation, which supplied a full briefing after I tabled the amendment. It supplemented my knowledge quite a bit. I hope noble Lords have received its briefing, which included several case studies to show how these consequences of the Hillside judgment last November could create cost, delay and disruption to development in large sites. I am not proposing to go through the case studies. I hope noble Lords will understand that at this late hour that would not be terribly helpful. It implies, however, with a series of examples, that the cost of a new, full application with all the attendant documentation, such as environmental impact assessments for a whole site, would be a very costly and time-consuming consequence.
Local planning authorities will not easily resource new large-scale applications for sites which they had regarded as already consented. It could mean that opportunities for desired changes, such as, in one example, to give a small builder access to part of a larger development, would not be offered if they would put the whole scheme at risk. I do not think we can even get into how difficult the community infrastructure levy or, in future, the infrastructure levy, would be to calculate in relation to such further planning permissions relating to the whole existing site. The uncertainty of whether the permission for a large site might be rendered invalid would be a serious risk to the effective delivery of major sites. Only immaterial changes on a large site would be regarded as safe: everything else would put it all at risk.
My objective in Amendment 258A is to give a straightforward statutory provision which would re-establish the position as it had been understood, i.e. that only if a subsequent permission renders the completion of an original permission physically impossible would the earlier permission be invalidated and—perhaps even more important by contrast—if it does not render the original permission physically impossible on the rest of the site, the earlier permission may continue to be relied upon in relation to the rest of that site, i.e. excluding the area to which the subsequent permission has been applied.
I am very grateful for the vocal support I have received for this amendment from the Home Builders Federation. I hope that the Minister may be able to support the intention of this amendment to the extent that she might even look to Parliamentary Counsel’s expertise to see whether my amendment serves the purpose or whether something supplementary might be moved on Report to achieve this—I hope—helpful objective. I beg to move.
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, I rise to speak to Amendment 268 in the name of the noble Lord, Lord Carrington, to which I have added my name. I have to say at the outset that I have no idea whether the noble Lord, Lord Carrington, would agree with my comments, but I hope that he would.
Your Lordships have listened to, and taken part in, many debates over the years on the challenges faced by rural communities. The noble Lord, Lord Cameron of Dillington, and my noble friend Lord Foster of Bath have chaired committees looking in depth at these challenges. The noble Lord, Lord Cameron, called for a national rural strategy, and I support this. Similarly, my noble friend Lord Foster pressed the case for there to be proper recognition of the challenges rural communities face and for the Government to have a discreet policy which recognises this. There is an industrial strategy, so why not a rural strategy?
The Government’s response was that all the issues faced by rural communities were covered under many other policy areas, so there was no need for a rural strategy. Assurances were given that all government policies would be rural-proofed. This, therefore, was a refusal to have a rural strategy—and there is very little evidence that all government policies are rural-proofed.
Baroness Hayman of Ullock (Lab)
My Lords, there are two amendments in this group in the name of my noble friend Lady Taylor of Stevenage: Amendment 259, which probes subsection (7), which is inserted by Clause 102; and Amendment 260, which probes the involvement of the Mayor of London under the new section. We consider Clause 102 to be relatively straightforward, in that it simply makes provisions concerning minor variations to planning permission, allowing for greater flexibility to make non-substantial changes that would not be possible at present without the submission of multiple applications by various different routes.
On that basis, we broadly welcome this change, because it will give effect to something that is long overdue, simplifying arrangements currently in place that were only ever intended as a short-term holding position. However, we have tabled Amendments 259 and 260 because there are a couple of areas of concern that we would like the Government to look at. First, current arrangements ensure that, if a variation to planning permission is sought, whether before or after completion, the circumstances of the day are considered when determining the Section 73 application. That, of course, includes the policies in place at the time and any other material considerations. However, as drafted, Clause 101(7) suggests to us—and the Minister may be able to clarify this—that the circumstances at the time of the original grant of permission would be the framework for determining applications in future. We are concerned that this would mean, for example, that if a new local plan had been adopted since the original permission, that plan—which might, for example, include more challenging environmental standards—could not be applied in deciding whether or not to grant the Section 73 application. It may well be that the Minister can clarify that for us.
Similarly, many Section 73 applications relate to the number of residential units or to floor space. Again, as drafted, we are concerned that the decision-maker would not be able to, for example, revisit the amount of affordable housing provided by the scheme, potentially creating a significant loophole. We think that local planning authorities should be able to consider up-to-date planning policy and/or guidance when determining such applications, to guard against such adverse consequences as I have just been talking about. We therefore propose that subsection (7) be removed from the clause.
Our second issue of concern relates to the powers that are devolved to the Mayor of London on strategic planning applications. As the Minister well knows, the Mayor has powers to become the decision-maker for strategic planning applications, subject to certain provisions. However, we are concerned that the Bill as drafted provides only for the Secretary of State’s call-in powers; we believe that leaves a vacuum in relation to the mayoral powers. We propose Amendment 260 to follow Clause 102(13) to ensure that the powers of the Mayor of London to call in applications in accordance with the terms of the Town and Country Planning (Mayor of London) Order are still taken into account.
I shall say a very few words on the other amendments that have been discussed. First, I thank the noble Baroness, Lady Bakewell, for introducing Amendment 268 in the name of the noble Lord, Lord Carrington. It is a very interesting amendment, and I am glad that she spoke to it. I absolutely agree with her that we should have a rural strategy. I should draw attention in my interest, in that I have recently been working with the Co-operative Party on its rural policy reviews: it is something that is very close to my heart at the moment. The Government should look closely at how they can give a bit of a leg-up to rural economic development. The Minister will know the particular challenges: there needs to be consideration and support and, as this is a levelling-up Bill, it is an opportunity to take that into account for our rural communities.
I thank the noble Lord, Lord Lansley, very much for his very thorough introduction. It was very interesting, because I had read the amendment and thought, “Okay, it could be about this; this is what I am thinking”, but his clarification was extremely helpful. I think that he has drawn attention to a really important anomaly in the way the current legislation works. In many ways, that brings us back to something that we have said over and over again—that it would have been better had we had a very specific planning Bill, then we could have got into the nitty-gritty of the current legislation, looked at how it could have been improved and streamlined, and any anomalies such as the noble Lord has drawn our attention to, and any contradictions, could have been properly resolved. So I say to him that we support him in what he is looking to do with his amendment and it would be a very sensible and practical thing for the Government to bring forth such an amendment on Report.
Lord Stunell (LD)
I just want to briefly say that I very strongly support the plea put in by my noble friend in relation to a rural strategy. I am also interested to understand the Minister’s response to the queries that the noble Baroness on the Labour Front Bench has raised about subsection (7); it requires some further explanation. I wait to see what the Government’s amendments look like. With that, I am happy to sit down and let proceedings continue.
Baroness Scott of Bybrook (Con)
Amendment 258B tabled by my noble friend Lord Lansley touches on the very specific matter of drop-in applications—not a legal term but one that is used a lot in planning circles. I know he will be well-versed in these matters, and I am grateful to him for exposing me to such technical but none the less important aspects of the planning process at this time of night. I thank my noble friend.
As we have heard, this amendment has been brought forward in response to the judgment handed down last year by the Supreme Court on Hillside Parks Ltd v Snowdonia National Park Authority. My noble friend has given much more detail, but this case considered how far new planning permissions for development that would affect existing planning permissions make these earlier planning permissions unlawful to complete.
I would like to assure my noble friend that my department is already engaging with the development sector to understand the implications of the Hillside judgment for existing and future development practices. As he will know, the matter of drop-in permissions whereby a developer seeks a separate, new permission to overlap part of an existing planning consent has been highlighted as a concern, particularly given their role in supporting the delivery of large-scale developments, which can take several years to build out.
I recognise that the intent of my noble friend’s amendment is to provide legal clarity about the validity of existing planning permissions where a new, overlapping permission is brought forward. However, I must stress that the case law in this area is now quite clear that, unless expressly severable, an existing permission must be interpreted as an integrated whole, and that where a new, overlapping permission comes forward that materially departs from that earlier permission, such that it is impossible to deliver that earlier development, it would be unlawful to carry out further works under that earlier permission. Of course, where the existing permission is clearly severable, or where a new, overlapping permission is not material, it will still be possible for developers to make a drop-in application.
New Section 73B, as introduced by Clause 102, provides for a new, alternative way to make amendments to development proposals and enables minor variations to be made to existing planning permissions. This will allow for changes to be made to existing development proposals, such as to the descriptor plans or conditions, accounting for any amendments already made, providing that the cumulative effect of those amendments does not represent a substantial difference to the original permission. It will be for the local planning authority, in exercising its planning judgment, to decide what constitutes a substantial difference on a case-by-case basis. We anticipate, therefore, that the new Section 73B will provide an alternative route for making changes for many large-scale developments, rather than them having to rely on drop-in applications. We will continue to work closely with the sector to consider whether more guidance about varying permissions would be helpful, and I would be very happy to discuss this further with officials and my noble friend if he would find that useful. With that assurance, I ask my noble friend to withdraw his amendment.
Amendment 259 tabled by the noble Baroness, Lady Taylor of Stevenage, and moved by the noble Baroness, Lady Hayman of Ullock, is intended to probe the purpose of new subsection (7) in Clause 102. This amendment was also tabled in the other place, with the concern that the provisions as drafted would require applications under new Section 73B to be considered in accordance with the framework in place at the time of the original grant of planning permission. New subsection (7) requires that the local planning authority limits its consideration only to the difference in effect that could arise between the original permission and any subsequent grants to vary or remove conditions under Section 73 or the new route, as a result of granting planning permission under the new route.
Lord Foster of Bath (LD)
I apologise for intervening at this late hour. On that point, since the Minister has promised she is going to write to people and has just said very clearly, on the record, that she shares the importance of economic development in rural areas, and given that I asked at Second Reading for evidence that the levelling up Bill had gone through the rural-proofing process, would she be kind enough to include in that letter details of how that process was carried out in relation to this Bill, because frankly, many of us think there is very little evidence of that?
Baroness Scott of Bybrook (Con)
I will certainly reflect on that question and see what we can do.
I thank the noble Lord, Lord Carrington, for his amendments, and I appreciate his concerns on a matter, which is close to his heart and to the heart of the noble Baroness opposite. While I support the intentions to lend further support to our rural economy, unfortunately I cannot accept this amendment, as it will not have the intended effect, and we believe it is unnecessary.
The permission in principle consent route is an alternative way of obtaining planning permission for certain housing-led development. When a proposed development is under consideration, it separates the matter of principle away from technical details. Our national planning policy framework strongly supports policies and decisions to promote sustainable development in rural areas. In particular, it states that to support a prosperous rural economy, local plans, neighbourhood plans and decisions should enable the development and diversification of agriculture and other land-based rural businesses.
Additionally, as set out in Section 58A of the Town and Country Planning Act, any economic development coming forward through permission in principle would have to be predominantly for housing development. Provision already exists to allow local planning authorities to grant permission in principle for economic development related to residential schemes within rural areas. Section 5A of the Town and Country Planning (Permission in Principle) Order 2017 also enables local planning authorities to grant permission in principle to any non-housing development if it is associated with residential development, and where the scale of the development and the use to which it may be put is specified.
I am aware that permission in principle is often used to test the principle of housing development within rural areas, rather than applicants going through the conventional planning application route, and these are assessed with our National Planning Policy in mind. It is a valuable tool in this respect, and I hope this provides reassurances to the noble Lord and the noble Baroness, and accordingly that she will withdraw his amendment on his behalf.
I turn now to Amendment 282, tabled by the noble Baroness, Lady Taylor of Stevenage, and put forward by the noble Baroness, Lady Hayman of Ullock, on the speeding up of the planning system. There are around 400,000 planning applications every year. The Government have heard many representations that the planning application process is too slow and inaccessible for some users—notably those without the expertise, such as everyday people. It therefore requires improvement and modernisation. The powers being brought forward in Clause 116 enable the Government to apply a more consistent, streamlined and digitally enabled approach to the way in which the applications are made, making it easier for everyday people to submit a planning application. This will also make planning data more accessible. My department is already working with local authorities to tackle the very issue that this amendment raises, working collaboratively with the local authorities through the Open Digital Planning project, which aims to increase efficiencies in the development management process through creating modern development management software. Local authorities using the software that we are trialling have seen an estimated 35% time saving in the pre-validation process, when an application is first submitted, and post-validation, when the process is to reach a decision.
Before enacting these powers, we will fully engage with the local planning authorities and the sector as a whole; given that one of the core aims of this power is to streamline the process, we will of course consider the impact on speed of decision-making. While I support the intention of this amendment, the Government are unable to support its inclusion and hope that the noble Baroness will not press it.
Lastly, government Amendments 260A and 260B provide for consequential amendments to Clause 102 to make consistent the legislation with respect to an application being made directly to the Secretary of State, in relation to new Section 73B and Section 73 of the Town and Country Planning Act 1990.
Lord Lansley (Con)
I am grateful to my noble friend, particularly for the opportunity to have further discussions with a view to coming back to this issue positively at Report. Drop-in permissions have played a significant part in enabling development to go ahead as people need it to do. The case law may now be clear, but it has become clear in the form in which it has developed only because there is no statutory basis for undertaking drop-in permissions in the way that they have been done for a number of years—and that is what we need to achieve. With her very kind response, I beg leave to withdraw Amendment 258B.
Baroness Scott of Bybrook
(a) in subsection (2),”Member's explanatory statement
This amendment paves the way for the second amendment in the Minister’s name to Clause 102.
“(b) in subsection (3)(d), after “73(1)” insert “nor an application that is to be determined in accordance with section 73B”.”Member's explanatory statement
This amendment adds a consequential amendment to Clause 102.
“(3A) But notwithstanding subsection (3) the completion notice deadline may be less than 12 months after the completion notice was served if the local planning authority are of the opinion that—(a) development has not taken place on the site for a prolonged period, (b) there is no reasonable prospect of development being completed within a reasonable period, and(c) it is in the public interest to issue an urgent completion notice.(3B) A completion notice may include requirements concerning the removal of any buildings or works authorised by the permission, or the discontinuance of any use of land so authorised, at the end of the completion period, and the carrying out of any works required for the reinstatement of land at the end of that period.”Member's explanatory statement
This amendment would enable the issuance of completion notices withdrawing planning permission with a deadline of less than 12 months when certain conditions are met, and enable completion notices to require that building works be removed from a site or a site be reinstated to its previous condition.
Baroness Taylor of Stevenage (Lab)
My Lords, I rise to move my Amendment 261 and I am very pleased that government Amendment 261A is complementary to my amendment, or at least I hope that is the intention.
Across the country, communities and councils have found themselves in the incredibly frustrating situation where permissions are sought but sites stay empty, and development does not progress; the LGA estimates that sites with planning permission for over a million homes have not been developed. As well as unbuilt housing we also see employment sites not progressed, communities and local businesses left in limbo and local areas facing an uncertain future and unable to make further plans.
In its comments on proposed reforms to the planning system, the LGA said:
“It is disappointing that no tangible powers were brought forward in the Bill to enable councils to encourage developers to build-out. We would urge the Government as a matter of urgency to empower councils to take decisive action on this issue.”
Too often it is local government that gets the blame for not approving plans quickly enough, but the LGA points out that since 2010-11 over 2.8 million homes have been granted permission but only 1.6 million have been built. In fact, nine out of 10 planning applications have been approved by councils and most adhere to the strict time guidelines for approvals.
The LGA has called for the Government to charge developers full council tax for every unbuilt development when the original planning permission expires, and for it to be easier for councils to use compulsory purchase powers to acquire stalled housing sites or where developers do not build to a timescale agreed with the local authority.
Since the pandemic, this situation has deteriorated because of labour shortages and the inflationary rise in the cost of materials so, as well as developers who are simply holding on to land to cash in on land values, there are also many genuine cases where the viability of schemes has been eroded. The LGA’s housing spokesperson has said that,
“by giving councils the right powers to incentivise developers to get building once planning permission has been granted, we can go further and faster ... to deliver the reform needed to enable councils to tackle the housing crisis”.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, I beg to move that the debate on this amendment be adjourned.