Queen’s Speech

Baroness Warwick of Undercliffe Excerpts

Tuesday 24th May 2016 Lords Chamber

[Baroness Warwick of Undercliffe (Lab)]

My Lords, I will direct my brief remarks to the forthcoming neighbourhood planning and infrastructure Bill. I declare an interest as chair of the National Housing Federation, the trade body which represents England’s 1,000 housing associations. The measures included in this proposed piece of new legislation will go some way to increasing the rate of housebuilding and thus tackling the urgent housing shortage this country faces.

This House has debated before the housing shortage that this country faces, which is at crisis point. The Government’s renewed commitment to delivering 1 million homes across the course of this Parliament is therefore both ambitious and admirable. Housing associations are well placed to contribute to the Government’s bold target and the sector welcomes the measures in the new Bill which will make good-quality local development easier by bringing forward land more cheaply and quickly.

Housing associations built a third of all new homes last year and actually increased their housebuilding during the recession, just as the private sector suffered from the downturn. They build an average of 40,000 affordable homes each year and in the past decade have built 82,000 shared ownership properties to help those on low and middle incomes to get on the housing ladder.

As businesses with a strong social purpose, housing associations are determined to do even more to ensure that everyone has a place to live at a price they can afford. This determination can be seen in L&Q’s partnership development of up to 11,000 homes at Barking Riverside. It is perhaps the largest development ever undertaken by the sector and includes plans for commercial units and public amenities. In short, L&Q is building a community.

It is this sort of ambition and innovation which the neighbourhood infrastructure and planning Bill will facilitate, albeit at scales appropriate to local areas. It is therefore perhaps no surprise that the sector welcomes the direction of travel. I am sure that noble Lords will agree that increased housebuilding should not ride roughshod over communities. Neighbourhood plans avoid this problem by providing certainty for both developer and community, so the Bill’s measures in this area are welcome. The proposals to make compulsory purchase orders simpler and more efficient will also speed up local development by ensuring that land is accessed at a fairer price, and in establishing the National Infrastructure Commission, the Bill will deliver a strategic and long-term approach to infrastructure—something that is long overdue and most welcome.

As I am sure that noble Lords will agree, the relentless focus on new supply is necessary to ensure that we reverse the worrying trend year on year of increased homelessness and rough sleeping, so it was disappointing that no homelessness legislation was announced, despite comments from the Minister for Local Government which suggested that the Government were committed to that. I hope that Ministers will carefully consider the recommendations of the recent Crisis report, which focuses on prevention at an early stage. Perhaps the Minister could deal with that point in his reply.

I cannot stress enough one vital point. To prevent homelessness, we must of course build more homes, but we must also protect the supported housing services which help the homeless and other vulnerable groups to live independently and get back on their feet. Supported housing services assist a wide variety of people, including those fleeing domestic violence, the elderly, the disabled, veterans and those with mental health issues. I trust that the Government will ensure that those services continue. The cap on housing benefit to local housing allowance levels is putting such services at risk, despite the fact that the Government have delayed its introduction for a year. If it comes into force in 2018, 41% of all supported housing services will close and 80% of new development will halt.

In our recent debates on the housing Bill, the Government undertook to establish a review of the size and scale of the supported housing sector and how it is funded. While that review is taking place, I strongly urge them to remove the threat of the LHA cap and ensure that these vital services receive the funding they need to continue delivering to vulnerable people.

I end on a different issue. The extremism Bill proposes some potentially draconian powers for institutions to be shut down if they are shown to have hosted extremists. Will those powers be so general that they have universities in their scope, as the Counter-Terrorism and Security Act 2015 already requires universities and colleges to prevent extremists radicalising students? If it is intended to include them, I urge the Minister to think very carefully in advance about how the powers will interact with the duties universities have to ensure freedom of speech on campus. I also suggest that the Government consider whether a duty to uphold freedom of speech should be written into the remit of the Office for Students proposed in the Higher Education and Research Bill, especially as it is likely to be required to regulate the sector in relation to Prevent. I declare an interest as vice-chair of UCL Council and a council member of Nottingham Trent University.

Charities (Protection and Social Investment) Bill [HL]

Baroness Warwick of Undercliffe Excerpts

Monday 29th June 2015 Grand Committee

[Lord Watson of Invergowrie]

My Lords, I argue that Clause 9 should not stand part of the Bill. I do so not because we do not wish this clause to stand part of the Bill but because we want to raise issues that have not had an airing through another amendment, and we have particular concerns over issues surrounding charities working in areas of conflict.

The Minister will remember that I raised that issue at Second Reading when I asked if he would speak with his ministerial colleague at the Home Office. I hope that he has now done so and will be able to make noble Lords aware of what that discussion produced. Again, I draw attention to the difficulties posed by current counterterrorism legislation to the protection of charities working overseas to deliver humanitarian aid. I accept that changes to the various laws that cover counterterrorism are not capable of being dealt with within the confines of the Bill. However, concerns were raised with the pre-legislative Joint Committee on these matters by several of those who gave evidence, in particular two umbrella organisations that cover NGOs that work abroad: Bond and the Muslim Charities Forum. They would welcome greater clarity from the Government, which would be helpful for all of us.

In response to the Joint Committee’s report the previous Government stated:

“Terrorism legislation is in no way designed to prevent the legitimate humanitarian work of charities, but it needs to be widely drawn to ensure that it captures the ever diversifying nature of the terrorist threat”.

That is understandable, not least in light of the unspeakably appalling events in Tunisia, Kuwait and France three days ago. However, in his evidence, the Government’s Independent Reviewer of Terrorism Legislation, David Anderson QC, told the Joint Committee that the use or suspected use of property for the purposes of terrorism was “monstrously” broadly defined in legislation. Coming from that source, such a comment carries significant weight, and you do not leave yourself open to charges of being weak or soft on terrorism—which we in the Labour Party most certainly are not—by seeking comment on a matter previously highlighted by the Government’s own Independent Reviewer of Terrorism Legislation.

Indeed, Mr Anderson pointed the Joint Committee in the direction of Australia and New Zealand, where specific exceptions exist in terrorism law to cover charities involved in the delivery of humanitarian aid. I am not comparing the UK to either of those countries with regard either to their size or the level of terrorist threat they face. However, given the similarities of the legal systems of all three countries, the possibility that such legislation might prove of value means that it should at least be examined. Again, I mention that the man who drew it to the attention of the Joint Committee can hardly be characterised as being other than committed to ensuring that the UK’s counterterrorism measures are as tight and effective as they possibly can be.

We acknowledge that the Charity Commission has been proactive on this subject and has meet with some of those NGOs faced with the kind of difficult circumstances to which I have referred, and the commission issues alerts and seeks to make charities as aware as possible of the risks involved. However, the current counterterrorism legislation, despite the fact that no prosecutions have been brought against UK NGOs that operate in conflict zones, is having a chilling effect on them, and undoubtedly makes it more difficult for those NGOs to deliver humanitarian aid.

The pre-legislative scrutiny Joint Committee highlighted this matter to the previous Government, who said in their response that they would,

“draw the Committee’s recommendation to publish guidance relating to prosecutions under counter-terrorism legislation … to the attention of the Director of Public Prosecutions”.

Given that three months have now elapsed and that—I think I can say this to the Minister—a clear line exists between the previous Government and the current one, will the Minister tell the Committee whether that has been done and, if so, what conclusions have emerged?

Finally, we believe that the commission and those charities which presently fear to tread in certain situations would welcome a form of words which went some way to providing more clarity—perhaps even legal certainty —on this important matter.

[Baroness Warwick of Undercliffe (Lab)]

My Lords, I support the probing questions of my noble friend Lord Watson of Invergowrie. At several stages in our pre-legislative scrutiny of the Bill, we became anxious about the breadth and vagueness of the powers which it bestows on the Charity Commission. These concerns were reinforced by a letter from the chairman of the Joint Committee on Human Rights, Dr Hywel Francis MP, in which he said:

“In the absence of further definition in the Bill itself, or other guidance, such broad and vague language significantly increases the power of the Commission and provides insufficient certainty to both individual trustees and charities about the possible consequences of their conduct”.

At each stage, when we had these concerns, we looked carefully at the evidence and concluded, as noble Lords will see from the report, that the powers were indeed justified in that they were likely to help to increase public trust and confidence in charities.

However, when it came to the inclusion of terrorism offences, as my noble friend has indicated, we received evidence that disturbed us. As noble Lords will know from our report, a number of witnesses expressed concerns over the difficulties presented by terrorism legislation in relation to the operational requirements of NGOs in challenging circumstances overseas. They were particularly concerned about charities operating in dangerous parts of the world for humanitarian purposes. My noble friend referred to the chairman of the Muslim Charities Forum, Dr Hany El-Banna, who told us that he thought counterterrorism legislation was,

“preventing us from having access to the neediest people”.

David Anderson QC, the Government’s Independent Reviewer of Terrorism Legislation, who has already been referred to, said concepts such as the provision of “indirect support” to terrorist organisations had,

“an impact on humanitarian charities, particularly when working abroad and when working in areas that are under the de facto control of a proscribed or designated group”.

He went on to say that charities operating in these areas ran the risk of falling foul of terrorism law by, for example, delivering relief to a general population which might include individuals or groups designated as terrorists. He suggested that an increased risk could deter charities and their trustees from delivering humanitarian support. Bond, the umbrella group, went on to suggest, in our words, that,

“the withdrawal of banking services exposed donor assets to greater risk because international NGOs had no option other than to use less secure money service bureaux or to carry sums of cash across borders”.

Nothing in what I have said undermines the need to deal with terrorism offences and to address legitimate concerns about the abuse of charitable funds in connection with terrorism. It does, however, raise questions about the uncertainty surrounding the application of terrorism legislation when it comes to charities operating in dangerous circumstances overseas. The pre-legislative scrutiny committee was offered the examples of Australia and New Zealand as places where Governments had addressed this issue and where specific exceptions in law existed to meet this point. We thought that this was worth pursuing, but when we raised it with the Minister for Civil Society, he said it fell outside his remit and was essentially a matter for the Home Office. He went on to say that it could be,

“chasing a problem that does not exist”,

since,

“no one has been prosecuted”.

I do not think that that is good enough. Clearly these charities are expressing real anxieties about the risks they might face and about the chilling effect of this legislation. The difficulties facing these charities are already enormous in Afghanistan, Iraq, Chechnya and Somalia, among other places. If it is possible to provide them with greater certainty in pursuing their important work and overcome this worrying and chilling effect, then we should try to do that.

Like my noble friend, I was disappointed with the Government’s response. The Government recognise that there are concerns, but points only to the problems of creating loopholes without even addressing the suggestion that they might look at the examples of Australia and New Zealand to see whether and how those countries have overcome this danger. I ask the Minister to think again and at least to consider whether other countries can provide some inspiration about whether there are ways to provide greater legal certainty.

Finally, the Government have said they will draw to the attention of the Director of Public Prosecutions our recommendation to publish guidance. I hope they will agree to do rather more than that and to put their weight behind the need for guidance to address the current uncertainty, which was revealed in our evidence and which the Government acknowledge.

[Lord Hope of Craighead]

My Lords, I draw attention to the last two sentences of paragraph 183 of the Joint Committee’s report, at pages 53 and 54. They refer to an exchange between me and the Minister speaking for the Home Office, the noble Lord, Lord Ashton of Hyde. I pointed out to him the difficulty faced, according to the evidence we received, by people who are trying to gain access to areas where people are in dire need of food, warm clothing or whatever else when somebody there is, in effect, a gatekeeper and refuses any transit to the areas where these people are without some form of payment.

One would of course support what the noble Lord, Lord Ashton, said as a general rule—one does not want people to pay money to terrorists for any reason—but the New Zealand legislation has addressed the problem by putting in the phrase “without reasonable excuse”. Something of that kind would go some way to addressing this problem, because a hard-edged refusal to contemplate any situation where money is paid by somebody—not to assist terrorist activity but simply to get access for a humanitarian purpose—would seem to be too severe. I would have thought that there is a need for some degree of flexibility, although like everyone else I recognise that this is a very sensitive issue and the last thing one wants to do is encourage terrorism. There is a conflict of two diametrically opposed interests here, and the hard-edged and uncompromising line, as described in the noble Lord’s reply when I put forward my suggestion, is prejudicing those who are in need of humanitarian assistance.

--- Later in debate ---

The Minister in the Commons spoke of engaging with the community land trust sector on the development of the right-to-buy policy. I put it to this Minister, responsible for charities, speaking here in the House of Lords, that he, along with the noble Baroness, Lady Williams of Trafford, who has responsibility in another department, might call in people from the community land trusts to talk to them about their problems and see whether a way around this can be found. I ask whether Ministers are making contact with the National CLT Network as the national charity for CLTs to discuss the implications of the right to buy for those organisations, and whether the Government might look sympathetically on an amendment, or even table their own amendment, to ensure that this particular sector of the housing association movement is exempt from what I can only refer to once again as this staggering nonsense which should be stopped at birth.

[Baroness Warwick of Undercliffe]

My Lords, I support my noble friend Lady Hayter in her amendment to reaffirm the independence of charities and of charity trustees. I declare an interest, in addition to others I have previously declared, as the chair-designate of the National Housing Federation.

The purpose of the Bill is to strengthen public trust and confidence in charities. The public will have that confidence only if charities are well run, live their values, fulfil their stated aims, deliver what they were set up to do and achieve value for the money entrusted to them to deliver services. Charity trustees have an obligation to act in accordance with their trust deed or governing document and to deliver their charitable outcomes for the benefit of the public. They are independent bodies, set up under a range of legal arrangements: they might be trusts, as we have learnt, companies limited by guarantee, incorporated by royal charter, or charitable incorporated organisations, all of which have different legal personalities.

Like my noble friend, I am concerned about one group of charities, housing associations, whose governance requirements might fall into any of the categories I just mentioned. However, they have one characteristic in common: all of them are independent of government at either local or national level, but they will be affected by a government policy, the right to buy, which could make them unable to deliver their stated aims, because they will be constrained in their freedom to make independent decisions about the use of their assets. As I have said, trustees have a fiduciary duty to use their charitable funds and assets reasonably and only in furtherance of the charity’s objects. They must avoid activities that might place the charity’s endowment, funds, assets or reputation at undue risk. However, the right to buy will ride roughshod over trustees’ responsibilities to take strategic responsibility for the disposal of their property assets.

I will not repeat the points I made in the debate about affordable housing on Thursday or the statistics highlighted so strongly by my noble friend, but I do want to emphasise the wide range of tenants and communities with which these housing associations work: those paying social and affordable rents, private renters, those with disabilities, those who need care and those in properties for shared ownership or outright sale. Housing associations are extremely flexible in response to tenants’ needs and, as has been said, are hugely ambitious to build more homes. It is clear that they will be critical to delivering the national response to the current housing crisis, yet they may be hobbled in trying to do so.

Trustees have to balance their charitable goals of building homes for those in greatest need with delivering homes right across the market. They have become extraordinarily adept at leveraging in private finance because finance companies have confidence in the trustees’ effective management of assets. If trustees’ control over their assets were to be undermined, that would make investors nervous and therefore less inclined to invest. Housing associations’ ability to build enough houses to meet national need will then be undermined.

To add to that downturn, there are nearly 2 million people on housing waiting lists and there is a real shortage of homes at affordable and social rent. While replacing homes sold, housing associations will have less capacity to build the new affordable homes needed. Meanwhile, local councils will be selling their high-value homes to fund the process and ostensibly replacing them one for one. But this has proved a challenging target in the past and there is every expectation it will be so in the future.

The charities Bill is not the place to sort out these policy problems, nor is it the place to decide whether historic charity law in all its variety might need to be tested. But it is the place to reaffirm the centuries-old principle of the independence of charities and the overarching duty of trustees to act only to fulfil the charity’s purpose. I urge the Minister to let that ring out loud and clear by agreeing to include the proposed new clause in the Bill.

[Lord Bridges of Headley]

My Lords, I thank all noble Lords for their contributions, which were clearly eloquent and heartfelt. I note your Lordships’ concerns and will ensure that they are brought to the attention of my honourable friend the Minister for Housing. I say that because the extension of the right to buy is being taken forward, as the noble Baroness just said, in another Bill, which is yet to be presented to the House. That Bill is the right place to have the debate on these issues. My noble friend Lady Williams of Trafford, the Parliamentary Under-Secretary of State for Communities and Local Government, explained to the House that our honourable friend in the other place—the Minister, Brandon Lewis—is already leading the engagement with the sector on our housing commitments as set out in our manifesto and is happy to meet Members of this House and others.

I turn specifically to the noble Baroness’s amendment. Under charity law, charities are already required to obtain the best price available when an asset is sold in most cases and the proceeds of the sale must be used to further the charity’s purposes. Amendment 12 seeks to prevent charities from using or disposing of assets in a way that is inconsistent with their charitable purposes. That would cause problems. Many charities hold property investments that are not directly used to further the charity’s purposes, some of which may not be consistent with the charity’s purpose. Instead, the investments are used to generate an income which is then used to further the charity’s purposes. What is relevant in this context is the income the charity can obtain, not whether its property is being used in a manner consistent with the charity’s purposes. Of course, many charities can and do use property assets directly or indirectly to further their purposes—but the point is that there are many that do not and which instead view property solely as a financial investment.

There is another problem with the noble Baroness’s amendment: it seeks to prevent charities being compelled to dispose of assets. There are already circumstances where charities can be compelled to sell an asset. They can be subject to compulsory purchase orders like any property owner. The Charity Commission and courts have powers to require charities to dispose of assets in certain circumstances and for the proceeds to be applied for the same or similar charitable purposes, although not necessarily in the same charity.

As the noble Baroness mentioned, there is also the preserved right to buy in relation to housing associations, which 630,000 tenants enjoy, and the right to acquire, which 800,000 tenants already have and which, when exercised, would compel the charity to sell assets. These existing rights would be undermined by the noble Baroness’s amendment.

I am sure that it was not the noble Baroness’s intention to frustrate with this amendment the existing right to buy, planning laws, or the powers of the court or the Charity Commission. I hope that she will accept that the proper time and place to debate the right-to-buy policy will be when the legislation on that subject is brought before the House.

Charities (Protection and Social Investment) Bill [HL]

Baroness Warwick of Undercliffe Excerpts

Tuesday 23rd June 2015 Grand Committee

All told, these two provisions together, Clause 3 and Clause 10, bring to what should be an objective test something that is far too wide and unclear for trustees to have confidence, first, that they themselves will know that they are likely to be deemed unfit to be a trustee or not to be disqualified, and, secondly, that they will know on what grounds the Charity Commission might disqualify them. Let us not forget that to be disqualified as a trustee has a profound affect on a person’s life. It really affects their reputation, not just their standing within their community but their professional reputation too. This is not a power that we should give the commission without very serious consideration. I beg to move.

[Baroness Warwick of Undercliffe (Lab)]

My Lords, I was sorry not to be able to take part in the Second Reading debate on the Bill, particularly as I was fortunate enough to serve under the excellent chairmanship of the noble and learned Lord, Lord Hope of Craighead, on the pre-legislative scrutiny committee. I declare my interests as chair of a charity, International Students House, as a member of the councils of two universities—UCL and Nottingham Trent—and as a member of the advisory council of NCVO.

As a member of the committee, I want to comment briefly on this amendment. I certainly do not want to repeat the points made by the noble Baroness. However, it was quite clear that we felt that, in the course of a statutory inquiry, the commission should not be limited to evidence of misconduct and/or mismanagement in the administration of the specific charity subject to such an inquiry. One discussion we had was around the Cup Trust, where the promoters of the scheme had a history of using charities in tax schemes.

However, we felt that the provisions of this part of the Bill were very broadly drawn since what is damaging to public trust and confidence in charities is obviously an open and potentially very subjective test. We shared the concerns of the Joint Committee on Human Rights, which expressed its anxiety about the breadth of this provision. We also shared the concerns of NCVO and several other witnesses—as the noble Baroness said—about the risks associated with this power and its lack of clarity. In particular, I know that NCVO was concerned that, in the absence of guidance, trustees and charities will be uncertain about the possible consequences of their conduct in relation to matters that will probably not have anything to do with the management or administration of the charity. I am very conscious of the points made by so many noble Lords about the reaction of trustees to the chilling effect of some of the commission’s powers. We are very unclear about the impact those powers will have.

As I said, I want to speak on this only briefly. I do not wish to exclude the reference to conduct not associated with charitable activities because that is very important. I hope the Government will look again at this. They said they would. They have not included any reference to this in the Bill, so I hope they will look again and be more explicit about the constraints on this apparently unlimited power.

[Lord Hope of Craighead]

My Lords, I just add a word to what the noble Baroness, Lady Warwick of Undercliffe, said by drawing attention to two paragraphs in our report—paragraphs 120 and 121. In paragraph 120, we refer to evidence from the Charity Law Association. It told us that, in its view,

“the wording of this power was ‘very wide’ and that it had concerns about how conduct would be deemed relevant for consideration by the Commission”,

if it was given that very wide power. In paragraph 121, we referred to the Muslim Charities Forum—this is on page 41 of the report—which expressed a concern that,

“the provision would allow the Commission to pass judgment on the political views of charity trustees, potentially infringing upon freedom of association and expression”.

A particular concern—and we quote from its evidence—was that trustees might, in a personal capacity,

“express support for Palestinian Statehood, speak out against the crack-down on Freedom of Association in the aftermath of the Arab Spring, or merely voice their anger at aspects of Western foreign policy”.

That could all,

“potentially fall under the net of supporting terrorism and/or extremism”.

It would then fall within the very broad description which is given in the two paragraphs to which these amendments refer.

I have to confess that we did not make any specific recommendation in our report. However, in paragraph 124, we state:

“we share the concerns of the JCHR and other witnesses about the risks associated with the power and its lack of clarity”.

I wanted to make these points to emphasise that there was a strong evidential basis for the concerns that the noble Baroness, Lady Barker, has expressed. These two references are in addition to those that the noble Baroness, Lady Warwick, mentioned in her short speech.