Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

Consideration of Commons amendments
Wednesday 25th October 2023 Lords Chamber

[Lord Ravensdale (CB)]

My Lords, I shall speak to Motion B. I declare my interests as set out in the register. I thank the noble Baroness, Lady Hayman of Ullock, the noble Lords, Lord Lansley, Lord Teverson and Lord Hunt, as well as the noble Baroness, Lady Hayman, all of whom supported the amendment at earlier stages.

I particularly thank the Minister for coming back with the government amendment. Although it does not give us everything that we asked for, it constitutes great progress in this area. It ensures that climate mitigation and adaptation will be considered in the national development management policies, and, looking at the wider context of plans in the Bill, will ensure that it is included and will then be a compulsory part of decision-making. Therefore, it goes some way towards giving us what we were after, and I am grateful to the Minister for coming back with that substantive amendment.

I have one small point. In the absence of a definition of climate change mitigation and adaptation in the amendment, perhaps the Minister might consider including the targets, with reference to the Climate Change Act and the Environment Act, in the Explanatory Notes to the Bill.

I welcome the comments made by the Minister in the other place that the Government intend to do a fuller review of the NPPF, to ensure that it contributes to climate change mitigation and adaptation as fully as possible, following Royal Assent. I hope the Government seize the opportunity here to strengthen chapter 14 of the NPPF to specify that, in determining planning applications, decision-makers must take account of climate change mitigation and adaptation.

The government amendment embedding climate and the environment in planning decision-making will have a great effect on getting clean infrastructure and sustainable homes built right across the country. Importantly, it will also do much to empower local authorities and regions to play their part in the net-zero transition, which they all want to do. We still see a need for further legislative work in this area—particularly on a move towards a statutory duty, as we propose—but, again, I am grateful for the progress that has been made.

Lastly, I thank all noble Lords who voted for my amendment and helped to get it over the line in a very close vote on Monday.

[The Earl of Lytton (CB)]

My Lords, I shall comment on each of the amendments. First, I commiserate with the noble Baroness, Lady McIntosh of Pickering. I do so as a past president of the National Association of Local Councils, the parent of parish and town councils in this country, which would dearly have loved to have had the facility to vary the way in which it deals with meetings. I am sorry that the Government have not seen fit to acquiesce to any of this. The Minister suggested that the measure went too far and that it would open the floodgates to local government holding virtual meetings as a matter of course. Were that his fear, the Government’s fear or that of the other place, it seems to me that it would have been perfectly possible to come back with a proviso that the Secretary of State would make regulation.

One matter that has never been explained to my satisfaction is the juxtaposition—the fact that, by definition, accountability is somehow measured by physical presence. I do not get that, and I do not think there will be many Members of this House present today who will get it. This issue will come back through sheer force of practicality and necessity. We have to move into the modern age, in that sense. I will leave my comments on that there.

I congratulate the noble Lord, Lord Ravensdale, on his success in getting what I can only describe as the obvious provision into this Bill, namely that we have to take climate change seriously and that it underpins everything that we do. To that extent, it was inevitable—if not in this Bill then in very short order—that something would have to be included somewhere in primary legislation, but I congratulate him on his persistence in getting this far. Even if it is not the whole bun, it is certainly more than a currant in the bun and he is to be congratulated.

In that context, there are other things in the Bill that have been left on the cutting- room floor. I am sorry that the noble Lord, Lord Crisp, is not here at the moment. His amendment on healthy homes is about something that is inevitably going to come back. It is not going to disappear; this is going to have to be the benchmark whereby society expects homes to be created.

The series of amendments which I have been trying to get through unsuccessfully was to do with building safety remediation. The fact is that so many leasehold homes are unprotected yet are faced with remediation costs and liabilities, without which they will not get insurance at any sensible cost. These homes are not excluded from the necessity of remediation by virtue of their height, whether it be 11 metres and below or above 11 metres, because the Building Safety Act 2022 says that it will cover all these other buildings.

It is simply not correct that somehow these homes escape the inevitable consequences of that. That is going to come home to roost because there is an entire market sector—an entire financial sector—that is dependent upon that being resolved. If it is not resolved now in this Bill, as it clearly will not be, then it will come back in short order because this is a matter of an existential threat to leasehold tenure, or indeed whatever tenure there might be instead of leasehold. If you have a building in multiple occupation, where different parts are apartments, this problem is going to come home to roost so long as there are defects caused in the original construction and the constructor and developer are able to walk away from that liability.

In congratulating the noble Lord, Lord Ravensdale, on getting his motherhood and apple pie amendment passed, let me remind your Lordships that other bits that have been left behind are also going to come back and haunt us as things go forward.

[The Duke of Montrose (Con)]

With the leave of your Lordships, I will touch on another small point. In Monday’s Hansard, the heading for this Bill said that legislative consent had been obtained from the Welsh Government but that the Government were still looking for legislative consent from the Scottish Government. In fact, a Scottish Government paper relating all the trials and tribulations that my noble friend had been through—it had 26 pages—was still operating. Are we still looking for more consent from that direction?

Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

Consideration of Commons amendments
Monday 23rd October 2023 Lords Chamber

[The Earl of Lytton (CB)]

My Lords, I have an interest in both the items that we are considering in this group. For the avoidance of doubt, I declare my involvement as a practising but nearly completely retired chartered surveyor with a knowledge of the leasehold and construction sectors.

The noble Lord, Lord Stunell, deserves the full appreciation of the House for what I can only describe as a progressive defenestration of the fuzzy edges that have surrounded the question of the building safety regulator. He has whittled it down to the last elements, as to whether this is a proposal for a like-for-like transfer from one jurisdiction, if I can term departments in that sense, to another—or whether, as he had previously identified, some other morphing process was going on behind the scenes. I supported him previously in this, and I support him again in his endeavours here. This really boils down to the last element, as to whether there is a change.

One could be forgiven for suspending a certain amount of belief here. If there is going to be the process of transferring a body from the Health and Safety Executive to some other framework, known or unknown, why would one run the risk of the delays, disruption and everything else that would be involved with that if it were not for the fact that some other factor was involved? Motion X1 as proposed by the noble Lord, Lord Stunell, is a significant litmus test of what is involved. I encourage the Minister to consider very carefully whether the Government mean what they say in saying that it is a like-for-like transfer from one authority to another, or whether in reality it conceals some other paradigm shift. That is very important.

I turn to the amendment proposed by the noble Lord, Lord Young of Cookham. I apologise for the fact that his colleague has had to use my comments from a previous stage in this debate to tell him that his approach is no good. Of course, my comments were made in the context of saying that it has a technical deficiency. I was not in any way intending to suggest that the direction of travel in which he was engaged was faulty or in any other way imbued with anything other than the highest principles. He and I share a great deal of what has happened here.

Again, the noble Lord is absolutely right in proposing Motion ZC1—and I was pleased that he referred, obiter as it were, to the problem with the exceptions. What has happened here is a sort of drawbridge approach to the liability and scope of the Building Safety Act, and it is that which creates these cliff-edge approaches to who is qualified, whether their funding qualifies or excludes them, and so on and so forth. That is what has been dogging everybody all the way along the line. In reality, that delineation of the protections under the Building Safety Act is pernicious, because they are protections that any Government should apply in response to a serious and systemic failure in the home building industry to deliver adequate quality in building safety terms—and, may I say, presided over by nearly 40 years of ineffective regulatory control of building standards.

To expand a little, the Government’s resistance to anything beyond the straitjacket of parameters relating to the scope of leasehold protections seems to be governed by an entirely arbitrary approach and unwillingness even to collect data, understand implications or assess risk—I refer specially to those non-qualified leaseholders to which the noble Lord referred. My aim in all this has been to approach the matter on a much broader spectrum. The noble Lord and I shared an amendment to the Building Safety Act 18 months ago, and I think he has felt obliged to whittle it down evermore to try to get to something that he can achieve here. I absolutely applaud his persistence—but I am forced to suggest that, in the absence of any risk assessment, any government response to what may come down the road will be blindsided and ineffective. Hearing or speaking no evil does not prevent evils occurring—in this case, to hundreds of thousands of innocent lease payers, to market sectors, to valuation, to lending, to regeneration of urban areas and to new homes targets generally. I have said all this before, and I apologise for repeating it.

The noble Lord has been assiduous in his campaigning. With regard to Motion ZC1, I do not know how many leaseholders might be affected by this, but I suspect that it is actually quite a small cohort, and the Government should accept it and not allow this exclusion process or drawbridge approach to cut them off. Of course, I tried to address the whole thing on a much wider scope, but to no avail, which is why, when my words are used as a reason for denying the noble Lord the fruits of his endeavours, I have to bear in mind that I seem to have been assiduously ignored throughout this, up until today, when my words are used by the Minister against his own Back-Bencher. There is something faintly quizzical about that whole arrangement.

I hope that the Minister will at least indicate that the Government are cognisant of the serious, ongoing and growing problems arising here—to finance, to a whole sector, to hundreds of thousands, a very large number, of excluded leaseholders, and much more besides. If the Government do not recognise that, we are in for very serious problems indeed.

[Baroness Pinnock (LD)]

My Lords, the very fact that these two issues remain for this Bill demonstrates that the Building Safety Act is, sadly, unfinished business. Although the matters will not be concluded today, I can be sure that they will be raised in future legislation in this House, because they need to be resolved. Having said that, I support what the noble Lord, Lord Young of Cookham, said about non-qualifying leaseholders. It is a large group which deserves not to be neglected, and I support my noble friend’s valiant efforts in getting the regulation appropriate to the need.

Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

3rd reading
Thursday 21st September 2023 Lords Chamber

[Lord Stunell (LD)]

My Lords, I am happy to take part in this debate simply because it is the last debate on the Bill in this House, at least until after the Conference Recess: we have had 16 days in Committee, eight days on Report and more than 1,000 amendments, skilfully disguised by the suffixes of letters. The noble Earl himself mentioned Amendment 247YYA as an example of how we have these invisible numbers. The Government have of course been a big contributor to the number of amendments, including 55 today. I do not object to those 55; they are a very sensible step forward to improve the Bill even further. Even so, I do not know if it is a record but the Government had, I think, four separate amendments to the Long Title of the Bill, which perhaps emphasises the point that the noble Lord, Lord Young of Cookham, made about the process.

Whatever our criticisms of the Bill, though, it leaves this House much better than it arrived, and I want to thank a wide range of people for helping that to be the case, not least the ministerial team. I add my thanks to the noble Baroness, Lady Scott of Bybrook, for her work in leading the ministerial team, and to the noble Earl and some other Ministers who stepped in at short notice, including the noble Baroness, Lady Swinburne, just last week. In my contact with the officials in the department, they were always polite, considerate and helpful. Catherine Canning last week was a very good and able representative of the Minister’s point of view in our discussions. So, whatever the criticisms of the Bill and the form in which it is now, I just say to the noble Earl that I hope that the ministerial team will work with their colleagues in the subsequent write-rounds and encourage them to the maximum extent possible to accept all of your Lordships’ valuable amendments in the other place, so that they can reduce the amount of ping-pong to the absolute minimum and we can keep the famous table tennis ball on the other side of the net.

I do not want to omit from my thanks the work there has been co-operatively between noble Lords in the Labour Party and ourselves, but also with our Cross-Bench friends and indeed with some of our friends on the Conservative Benches as well. Collectively, we have shown that it is possible to scrutinise thoroughly, to improve legislation and to produce an outcome that we can take some pride in—perhaps muted pride in some parts but, nevertheless, it is a step forward.

Behind the scenes, in our case I have the amazing and redoubtable Sarah Pughe, who has done a fantastic job supporting colleagues here in the Chamber with her drafting skills and her knowledge of parliamentary procedures. So, the Bill goes back to the Commons. I hope that when it comes back to us, it will be as near as possible the same document that we are sending to them.

[The Earl of Lytton (CB)]

My Lords, as it is not customary for anyone on these Benches to speak on their behalf, I just add thanks on my own behalf, which I hope will be shared by colleagues, to the Minister, particularly for his appreciation of the contribution made from these Benches. Of course, I send my best wishes to the noble Baroness, Lady Scott of Bybrook. Her courtesy throughout has been outstanding and her tenacity to be admired, and I add my best wishes for her restoration to good health as soon as possible. I add my thanks to the Bill team, even if we did not agree on quite a number of points, and to our clerks. I particularly thank the noble Earl’s colleague, the noble Lord, Lord Parkinson of Whitley Bay, for the way in which he responded to the question of building preservation notices, to the CLA, of which I am a member, and Historic Houses for their valuable input on that.

On the other matter of interest to me, namely building safety remediation, I am of course sorry that I could not persuade the Government or your Lordships to support a different way forward, but I owe a tremendous debt of gratitude to people outside—they know who they are and I will not mention them by name, but they have dedicated their time free and without any benefit to themselves to assist me with their comments and their critique. I also thank the many other experts, and professional and trade bodies, who were willing to share their thoughts with me.

I particularly express thanks to Amanda Walker, a leaseholder, for her courage in coming forward with her story, and the hundreds of other leaseholders who wrote to me with theirs. I thank Jake Fisher for his online petition, which gained 50,000 signatures in 25 days. My focus throughout has been on them and getting fair treatment for affected leaseholders generally, even if my approach has not always been fully understood or appreciated. I do not intend to give up trying.

Finally, I am most grateful for the support across the House for the general principle sitting behind the fact that we all, I think, believe that leaseholders should not pay for construction defects for which they are blameless. There is clearly a lot more work to be done, but I am enormously grateful for the general acceptance across the House of that principle.

[Baroness Hayman of Ullock (Lab)]

My Lords, I start by thanking the noble Earl for his very kind comments around the constructive work that we have all been doing together. I send our very best wishes to the noble Baroness, Lady Scott of Bybrook, who has been a remarkable workhorse on the Bill. Her door has always been open to us for any discussion and I thank her very much for that. Alongside her, a number of people need to be given a Levelling-up and Regeneration Bill endurance award, because it really has felt a bit like that at times: we have been ploughing through this since January. So, I thank her and the noble Earl, Lord Howe, but also the noble Baroness, Lady Bloomfield. People seem to have forgotten—we have been going on for so long—that she did an enormous amount of work in the early stages of the Bill, so we want to pass our thanks to her as well. We also thank the noble Baroness, Lady Swinburne, and all the visiting Ministers who have come in and talked to the different areas of their expertise.

We have done extremely constructive Cross-Bench work with the Government, noble Lords on the Government Benches, Cross-Benchers and our Liberal Democrat colleagues, particularly the noble Baroness, Lady Pinnock. It is very good to have been able to work so constructively on the, unusually, many different issues in this Bill that we have had to discuss, tackle and understand. On that note, I also thank all the organisations and NGOs that have provided so much information, time and support to us in understanding some of the more complex areas. I have a whole book of all their different names, which would take too long to go through—if you took part, we are very grateful; thank you for making the Bill better than when it arrived here.

Many Back-Benchers worked incredibly hard on this and we should be very grateful to them. I particularly thank my noble friend Lady Taylor of Stevenage, who has been the most tremendous support to me all the way through. I could not have done it without her help. I also thank our team; Ben Wood in our office has worked incredibly hard and tirelessly on this Bill, through recess and weekends. We have asked so much of him and he has always delivered everything. My final thank you is to the doorkeepers, who have sat through a few late nights with us on this and have always kept a smile.

There are quite a number of outstanding issues that we will come back to after the Recess, on which this House believes that the Bill could be improved. I hope that, ahead of ping-pong, when we revisit these issues, the Government will continue to work constructively with those of us in this House who believe they are important to improve the Bill. Our door is always open. We look forward to hearing from the Government on some of those issues.

Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

Report stage
Monday 18th September 2023 Lords Chamber

Moved by

[The Earl of Lytton]

260A: After Schedule 20, insert the following new Schedule—
“SCHEDULEBUILDING SAFETY REMEDIATION SCHEMEDuty to establish the scheme
1 (1) The Secretary of State must establish, or make arrangements for the establishment of, a Building Safety Remediation Scheme (“the BSRS”).(2) The purpose of the BSRS must be to ensure that residential blocks of flats with building safety risks are made safe, mortgageable and insurable—(a) in accordance with the building safety remediation principle,(b) speedily, efficiently, effectively and proportionately,(c) without cost to leaseholders or occupiers, and(d) so far as reasonably practicable without recourse to lengthy and expensive legal proceedings.(3) For the purposes of this Schedule “building safety remediation principle” is the principle that—(a) so far as reasonably practicable, remediation costs for relevant buildings with building safety risks arising from defective construction or additional building work should be met by the developer, the principal contractor or both, and(b) where that is not reasonably practicable, or where building safety risks do not arise from defective construction or additional building work, costs should be met by the building industry.Scope of the scheme
2 The BSRS must be framed so as to apply to relevant buildings which—(a) were constructed, or subject to additional building work, on or after 1 June 1992, and(b) present building safety risks.Operation of the scheme
3 (1) The BSRS must provide for persons (including freeholders and leaseholders) to apply—(a) for a building to be recognised as a relevant building, and(b) for a relevant building to be recognised as eligible for grants in respect of the cost of remediation works.(2) The BSRS must provide—(a) for the appointment of persons (“BSRS adjudicators”) with appropriate expertise to determine, on behalf of the Secretary of State, applications under sub-paragraph (1)(a) and (b), and(b) for BSRS adjudicators to be required to exercise operational independence in making determinations under the scheme.(3) For the purposes of sub-paragraph (2), the BSRS may provide for appointments to be made by the Secretary of State or by one or more persons designated for that purpose by the Secretary of State under the scheme.(4) The BSRS must provide that determinations of BSRS adjudicators in respect of building eligibility for the scheme under paragraph 4 are final (but nothing in this sub-paragraph prevents the exercise by the High Court of its judicial review jurisdiction).Scheme supplementary regulations
4 (1) The Secretary of State must make regulations (“scheme supplementary regulations”) in respect of the BSRS.(2) Scheme supplementary regulations, in particular—(a) may make provision for determining what is to be, or not to be, treated as a relevant building for the purposes of the scheme;(b) may make provision for determining the date on which buildings were constructed or subject to additional building work; (c) may make provision for determining who is entitled to make an application under the scheme in respect of a relevant building;(d) may specify criteria to be applied by BSRS adjudicators in determining whether a relevant building presents building safety risks as a result of defective construction (and the criteria may, in particular, make provision wholly or partly by reference to building regulations or other enactments in force at the time of construction or by reference to specified classes of document);(e) may make provision permitting or requiring BSRS adjudicators to conduct tests, and requiring owners and occupiers of relevant buildings to cooperate with BSRS adjudicators in conducting tests;(f) may make provision permitting BSRS adjudicators to require local authorities or other specified classes of person to provide information or documents, and requiring persons to comply with any requirements imposed;(g) may make provision about the timing of applications and determinations;(h) may make provision about evidence to be adduced in support of an application;(i) may require or permit BSRS adjudicators to operate a rebuttable presumption of defective construction where specified classes of fact have been proved (for which purpose the regulations may make provision similar to, or applying with or without modification, any enactment);(j) may make provision about the making, processing and determination of applications under the scheme;(k) may make provision about the giving of notice to developers and others;(l) may make provision about the payment of awards;(m) may make provision about monitoring expenditure on remediation works;(n) may set a threshold for the estimated or quoted cost of remediation works below which an application for recognition cannot be made;(o) may make provision for determining, having regard in particular to the need for proportionality, the nature and extent of remediation costs which may be funded by the scheme (for which purpose “remediation costs” means any class of expenditure related to building safety risks, including, in particular, repair costs, the costs of interim mitigation or safety measures and reimbursement of or compensation for increases in insurance premiums);(p) may make provision for account to be taken of grants provided in respect of remediation works by any other scheme established by enactment or by a public authority;(q) may make provision for financial assistance provided by any other scheme established by enactment or by a public authority to be repaid out of grants under the remediation scheme;(r) may permit or require the amalgamation of multiple applications in respect of one relevant building, or of applications on behalf of the residents of one or more relevant buildings;(s) may permit or require representative applications on behalf of the residents of one or more relevant buildings;(t) may make provision about the qualifications, appointment, remuneration and conduct of BSRS adjudicators, and the regulations may, in particular—(i) provide for adjudicators to be remunerated from BSRS funds; (ii) provide for indemnities in respect of decisions taken by adjudicators (for which purpose the regulations may apply an enactment (with or without modification));(u) must include provision requiring the maintenance and publication of records of applications and determinations under the BSRS;(v) must confer a right to appeal to the First-tier Tribunal in respect of determinations as to whether a building safety risk arose from defective construction or additional building work.Scheme funding regulations
5 (1) The Secretary of State must make regulations about the funding of the BSRS and of grants made under it (“scheme funding regulations”).(2) Scheme funding regulations must aim to apply the building safety remediation principle so far as practicable.(3) For that purpose, scheme funding regulations must aim to ensure that a grant awarded under the BSRS is funded—(a) so far as possible where building safety risks arise from defective construction or additional building work, by the developer or principal contractor of the building in respect of which the grant is awarded, and(b) failing that (whether by reason of the dissolution of a developer or principal contractor, insolvency or otherwise), or where building safety risks do not arise from defective construction or additional building work, by money paid into a fund maintained through a levy on the building industry in general, or specified parts of the building industry.(4) For the purposes of achieving the objective in sub-paragraph (3)(a)—(a) the reference to the developer of a building includes a reference to any person who arranged for its construction or additional building work and for the sale of units in the building;(b) the reference to the principal contractor is a reference to the person who was responsible to the developer for the construction of a building or undertaking additional building work;(c) scheme funding regulations must permit a BSRS adjudicator to provide for an award under the scheme to be paid by one or more persons specified by the adjudicator (and awards may, in particular, provide for joint and several liability);(d) scheme funding regulations must confer a right to appeal to the First-tier Tribunal;(e) scheme funding regulations may include provision permitting a BSRS adjudicator to permit or require an award for payment by a specified person to be satisfied wholly or partly by a person connected to that person (within the meaning of the regulations, for which purpose the regulations may apply, with or without modification, section 121 of the Building Safety Act 2022 and any enactment relating to joint ventures);(f) scheme funding regulations may include provision about enforcement of liability to satisfy awards, which may, in particular—(i) provide for collection of awards as a statutory debt,(ii) include provision for interest or penalties,(iii) provide for liability to make payments pending appeal or review, and(iv) create criminal offences in connection with evasion.(5) For the purposes of achieving the objective in sub-paragraph (3)(b), scheme funding regulations— (a) must establish one or more levies to be paid by specified businesses or classes of business;(b) must make provision for determining liability to pay the levy;(c) may confer functions on BSRS adjudicators or other specified persons (which may include the Secretary of State) in respect of determination of liability to pay the levy;(d) must confer on a person determined to be liable to pay the levy the right to appeal to the First-tier Tribunal;(e) may provide for different amounts of levy to be paid by different classes of person;(f) may provide for the levy to be paid by way of one-off payments, periodic payments or both;(g) may include provision about enforcement of liability to pay the levy (which may, in particular, provide for collection of the levy as a statutory debt, include provision for interest or penalties and create criminal offences in connection with evasion);(h) must include provision about the administration of the levy by the Secretary of State, including provision as to the maintenance and publication of estimates, accounts and other records;(i) may include supplemental provision about the levy.(6) In making regulations under sub-paragraph (5), and in particular in assessing the proportionality and other fairness of any levy imposed by regulations under sub-paragraph (5), the Secretary of State must—(a) have regard to any other levy or similar imposition that appears to have a similar purpose as a levy under the scheme funding regulations, and(b) must consult persons appearing to him or her to represent the interests of persons affected by other relevant levies and impositions.(7) Scheme funding regulations may include provision about—(a) application of awards, levies and grants, including provision for holding (or return) of surplus funds;(b) the nature and extent of obligations imposed by awards (which may, in particular, provide for payments in money or services or money’s worth);(c) processes and procedures to be applied in determining applications for grants and questions of liability to awards (which may, in particular, include provision for determination wholly, partly, absolutely or contingently by arbitration, mediation or any other kind of process or procedure the Secretary of State thinks appropriate);(d) terms and conditions of awards, levies and grants;(e) appraisals, appeals and enforcement.Apportionment
6 (1) Scheme funding regulations may make provision about apportionment of liability for defective construction.(2) In particular, scheme funding regulations may provide that where a person is required to pay an award under the BSRS, that person may bring proceedings to recover a contribution from one or more persons who share responsibility for the defects in respect of which the award is made.(3) Provision made by virtue of this paragraph may—(a) confer jurisdiction on the First-tier Tribunal or on any other specified court or tribunal;(b) apply (with or without modifications) any enactment about third- party liability.Interim payments
7 (1) The Secretary of State may make interim grants to persons whom the Secretary of State believes are likely to be entitled to benefit from the remediation scheme.(2) Interim grants may be made on such terms and conditions (including as to repayment) as the Secretary of State may specify.(3) Scheme supplementary regulations—(a) may include provision for account to be taken of interim grants under this paragraph, and(b) may include other provision about interim grants under this paragraph (including provision about applications for grants, eligibility for grants and determination of applications for grants).Interpretation
8 For the purposes of this Schedule—“building safety risk” has the meaning given in section 120(5) of the Building Safety Act 2022;“building industry” has the meaning given in section 127(7) of the Building Safety Act 2022;“construction” includes any kind of building work (whether part of the original construction of a building or not) including works of improvement, repair and extension;“class” includes description;“defective construction or other building work” means construction or additional building work that—(a) contravened building regulations or other enactments in force at the time of the construction or additional building work, or(b) satisfies any other criteria specified in the BSRS or in scheme supplementary regulations;“BSRS funding regulations” has the meaning given by paragraph 5;“BSRS scheme” has the meaning given by paragraph 1;“BSRS adjudicator” has the meaning given by paragraph 3;“grant” includes loans and any other form of financial assistance (for which purpose a reference to payment includes a reference to the provision of assistance);“building safety remediation principle” has the meaning given by paragraph 1;“remediation costs” has the meaning given by paragraph 4;“relevant building” means a self-contained building, or self-contained part of a building that contains at least two dwellings;“scheme supplementary regulations” has the meaning given by paragraph 4.Consultation
9 Before making the scheme, the scheme supplementary regulations and the scheme funding regulations, the Secretary of State must consult—(a) persons appearing to represent the interests of freeholders, leaseholders or occupiers of blocks of flats with building safety risks,(b) persons appearing to represent the interests of the construction industry and related industries, and(c) such other persons as the Secretary of State thinks appropriate.Regulations
10 (1) Scheme supplementary regulations and scheme funding regulations—(a) may make provision that applies generally or only for specified purposes, (b) may make different provision for different purposes,(c) may confer functions (including discretionary functions) on specified persons or classes of person, and may provide for the Secretary of State to appoint persons to exercise functions under the regulations or the remediation scheme (whether or not on behalf of the Secretary of State), and(d) may include supplemental, consequential or transitional provision.(2) Scheme funding regulations may not be made unless a draft has been laid before, and approved by resolution of, each House of Parliament.(3) Scheme supplementary regulations are subject to annulment in pursuance of a resolution of either House of Parliament.”Member's explanatory statement
This new Schedule would implement a building safety remediation scheme to ensure that buildings with building safety risks are put right without costs to leaseholders.

[The Earl of Lytton (CB)]

My Lords, I rise to move Amendment 260A in my name and to speak to Amendments 282J and 315B, which are linked to it. I first express my gratitude to the noble Baroness, Lady Scott of Bybrook, for her willingness to engage, and I wish her a speedy recovery and restoration to full health. However, I note with regret that a 35 or 40-minute slot is insufficient to cover the ground and that, given that the premise of my amendment has never been accepted, discussion of much of the detail has not been possible.

I make it clear from the outset that I may wish to test the opinion of the House but, before deciding that, I particularly wish to consider and gauge the views of noble Lords on a matter that I believe to be of fundamental importance to the purposes of good government, justice, equality under the law and economic stability. I refer to a crib sheet, if I may call it that, which I submitted to the department. I hope that it reached the attention of the noble Earl, should he be responding to this. I apologise for the fact that it was not sent earlier, as I had intended, which is something to do with the stability of the electrical grid in my part of West Sussex during most of yesterday.

I outlined in Committee the aims of these amendments, which have had the benefit of expert scrutiny by parliamentary counsel and construction councils, construction administrators, conveyancers, academics, property professionals and trade associations. There has been support from all these quarters. I am therefore satisfied that the amendments are technically competent, complementary to the measures already in the Building Safety Act 2022 and capable of implementation. In short, they aim to make the development and construction sector responsible for defects in buildings arising from poor building practices and to prevent the burden falling on innocent leaseholders in their homes or being funded by the taxpayer.

I remind your Lordships of the basics of Amendment 260A; I will not go into detail. First, it is aimed at simplifying establishing initial liability without a lengthy legal process. This asks the question of whether there was a significant critical defect in the original construction and, if so, who was responsible for the works, and their route to compliance. Secondly, it aims to reduce the contested areas to one largely of quantum, via an adjudication process and the First-tier Tribunal. Thirdly, it aims thereby to cut costs and risk barriers to leaseholders in getting redress directly or indirectly. Finally, it provides a backstop levy where the defects are not a result of construction failure, or else where the developer or contractor no longer exists. The intention is that this should be wide and shallow, and encompass materials, manufacturers, warranty providers, approved inspectors, specifiers and so on, as well as contractors.

My amendments mean that DLUHC would have to do things differently, but I weigh that against the current situation of allowing innocent homeowners to bear the brunt. Going forward, the incentive for housebuilders to cut corners must be replaced with an ongoing reminder to meet good construction practice at all times. The amendments also give exceptionally wide discretion to the Secretary of State in implementing proposals, subject to certain core principles. So, it is getting ahead of the process to claim, as some have, that these would not work.

More to the point, my amendments would dismantle much of the complexity the Government have decided to put in place with their own remediation scheme under the BSA. I am returning to this theme because I am not satisfied with the government response I have received to date. My case rests on one of the most fundamental principles of humankind: that if someone does something wrong and it injures another, they should provide restitution. On 13 September last week we discussed amendments to the Bill on nutrient neutrality. There were outstanding speeches from these Benches, not least from the noble Duke, the Duke of Wellington, and a stellar contribution from the noble Lord, Lord Deben. In response, the Minister stated:

“Another issue brought up by a number of noble Lords is that the developer should pay. The Government agree. It is essential that housebuilders contribute fairly, and we all agree with the principle that the polluter should pay”.—[Official Report, 13/9/23; col. 1060.]


In the context of building safety, however, it appears that the Government do not accept that same principle—or, if they do, they think it stops short of protecting all innocent leaseholders or indeed of making developers and main contractors liable for the mistakes they made at the time of construction, at a point when they had full agency and control over the construction project.

The ill effects, as we see them now, blight hundreds of thousands of leasehold homeowners who bought in good faith. I do not know the numbers but I believe there are more than 200,000, a figure that I have quoted before and the Government have not disputed. These people did not buy a product sold discounted “as seen” from a seconds rack but a full-value home, backed by warranties and certificates of every sort, covering many things that they could not possibly see or inspect for themselves.

I took away from a meeting last week with the Minister and the Bill team that the Government believe it sufficient that the BSA has widened the Defective Premises Act so that leaseholders can better pursue big corporates, via their freeholder, for redress over demonstrable failings to construct buildings to the then regulatory standards. Further, the Government believe they should do so at their own risk and expense, and to bear the consequential costs in the meantime. They also believe it is in order for affected leaseholders who are deemed non-qualified to continue to live in potentially unsafe blocks, in a financial fix and under the cloud of remediation costs.

When we discussed similar amendments to the Building Safety Act in 2022, speaker after speaker expressed a clear wish for focused, timely and effective action. As time goes by, there is a growing tally of enforced building evacuations—I believe there have been 27 since 2017—and a rising tide of leaseholders who are adversely affected. They have written to me in large numbers, some 250 since the middle of March, telling me of waking watch costs, enormous insurance rises, crippling remediation bills, properties that cannot be sold or refinanced, and lives upended. What should have been the security of their homes has turned into a financial and emotional prison. Just recently, some 51,000 people have signed a petition asking for something to be done. This is a problem that has not gone away.

So complicated are the rules under the BSA—developed by our rather process-focused administration—that even lawyers and conveyancers cannot figure them out and are now distancing themselves from handling work involving affected flats. I refer to the rules on leaseholder qualification; landlord certification; estimating remedial costs in times of rapidly rising prices; ascertaining landlord worth; the pitfalls leading to exclusions; the roulette of getting any recovery from original contractors; the programme for remediation; and the sheer arbitrariness and lack of clarity of it all.

My fear is that the financial standing of these assets is next in line. The Government assumed that landlords as building owners had the money and means to protect leaseholders. Some do but their respective interests do not coincide, and it is a moot point whether building owners are any more responsible for the construction defects in their buildings than the occupiers. The Government’s apparent predilection for charging owners with open-ended responsibilities without any clear route to cost recovery looks to me like a less than even-handed application of equality under the law.

It is also perfectly clear to me that many freeholders do not have the assets to enable them to risk taking on contractors, while others may be minded to do a disappearing act or become insolvent. I know that the Government’s proceedings against Railpen in respect of Vista Tower in Stevenage—I am sure that the noble Baroness opposite will be familiar with that one—are still stuck in the courts. In reality, however, no block owner or leaseholder collective could possibly afford to mount such a case.

Last Wednesday in the nutrient debate, if I can call it that, the Minister’s parting shot was that some £18 billion of added value to the economy was at stake, but that is not the only metric. The National Residential Landlords Association estimates—it is the only estimate that I know of—that there are 1.7 million non-qualifying leaseholders in existence. If just 10% of them are in buildings requiring significant remediation, which appears to be the general experience of building owners in terms of a percentage, even taking a well below average remediation and consequential cost per flat of, say, £20,000, that amounts to a staggering £34 billion write-down on the private sector alone, or nearly double what was bothering the Minister on Wednesday. Some observers put the damage north of £50 billion, and I can well believe it. Add in social housing and shared ownership, plus the potential sectoral damage in terms of market sentiment that I believe is now taking root, and potentially it is a lot more still.

DLUHC’s own latest data shows that the building safety fund is still taking ages to process, approve and release funds—typically more than three years, in a time of rapid inflation in construction costs. It reveals that, as at the 14th of this month, there were 2,833 remediation resident registrations in relation to non-ACM—the cladding material—private sector blocks, of which only 49 have had their problems fixed. It seems that in all this the Government are not collecting the data, still less sharing it. I have asked how many properties of 11 metres and below there are which may be affected. The Government do not seem to know this; it follows that the data on impacts is effectively unknown. How then is policy made on this matter?

I think everyone will agree that there has been a lot of time available to sort this out, so the process requires the turbocharging that my amendments would provide. I am aware that the Government’s objections to these amendments are many, but I do not believe they fully address the issues. There is a social evil taking root here, in that innocent consumers are paying heavily for the mistakes of producers. One criticism is that the amendments would require individual building assessments, and that that would slow the whole process—but how else does one identify or assess the essentially random nature of poor construction, other than on a per-building basis? Another is that there is not enough professional inspection capacity, but that applies whatever the total number of defects may be—unless, of course, the intention is simply to ignore some significant defects altogether.

I am also told that it would overstretch limited departmental resources, but it is over six years since the awful tragedy of the Grenfell Tower, and it is the job of government to take necessary action, not to wring their hands. The Government say that my solution is too complex. I say that it is not half as complex as what they have already put in place—and remember, I am not asking for a taxpayer bailout. The levy provided for in these amendments would deal with any shortfalls.

We clearly are not there yet. Conveyancing sources tell me that there is a growing trend at this very moment in contracts for sale of new flats, where there are now inserted clauses placing the entire onus for future defects on the buyer, on a “take it or leave it” basis. Meanwhile, I am not aware of any moves by the Government to remove the unfairness of excluding so many leaseholders from their scheme, or indeed of moves to put anything in place to tackle the building safety problems that I have identified.

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[Earl Howe (Con)]

My Lords, as my noble friend Lady Scott said in Committee when the noble Earl, Lord Lytton, brought forward his now-rebranded “polluter pays” amendments, these issues have already been debated at length in this House—I address here Amendments 260A, 282J and 315B. I agree that too many developers and landlords are being too slow to remediate buildings for which they are responsible. However, the Government have not been idle in this space; blocks of flats are being made safer as we speak. Under the regulatory regime that the noble Earl wishes to scrap and replace, 96% of all high-rise buildings with unsafe “Grenfell-style” ACM cladding have been remediated or have remedial work under way.

The leaseholder protections are showing real promise on the ground, so it would seem folly to scrap them and start again from scratch. Indeed, accepting these amendments would set back the progress of remediation by over a year as industry and leaseholders work to understand another new system, just as they are getting to grips with the Building Safety Act—the noble Baroness, Lady Taylor, was quite right to express her doubts on that score. At various points, the noble Earl has talked about his scheme sitting alongside the existing protections, but I argue strongly to your Lordships that that would be a recipe for chaos and confusion. Please do not let us land ourselves with that.

Secondly, many of your Lordships will have already taken part in debates on the regulations to give effect to our responsible actors scheme. That scheme, alongside our developer remediation contracts, requires eligible developers to fix the problems they have caused—I emphasise that clause: to fix the problems they have caused. Eligible developers who do not join the scheme and comply with its conditions will face prohibitions.

In response to the concerns of the noble Earl that the non-qualifying leaseholders are stuck in unsafe flats, as I think he put it, that is simply not true. All principal residences over 11 metres are covered by the protections. Following on from that, he expressed concern that the leaseholder protections do not protect every leaseholder. I just remind him that the direct protections that we have put in place are only part of the Government’s overall scheme. I have already referred to the responsible actors scheme and the developer remediation contracts, and I also point to the more than £5 billion set aside to replace cladding. The new powers in the Act to seek remediation contribution orders against developers, or to pursue them under the Defective Premises Act, also provide valuable indirect protection. Non-qualifying leaseholders are able to seek a remediation contribution order from the tribunal against a developer or contractor in exactly the same way as qualifying leaseholders. Let us remember that, where a developer has signed the developer remediation contract, it will fund all necessary remediation work—both cladding and non-cladding-related—irrespective of whether individual leases in those buildings qualify. Those on the current list of developers are only the first to be pursued; we have committed to expanding that list now that the regulations have been brought forward.

I make one further point. The noble Earl was concerned that the protections under the Building Safety Act remediation scheme will not apply to future buildings. The leaseholder protections address problems with buildings built poorly in the past. Part 3 of the Act raises standards for future buildings; we do not need a remediation scheme to reach into the future. All in all, I hope that, on reflection, the noble Earl will see fit to withdraw Amendment 260A and not move Amendments 282J or 315B.

I turn next to Amendments 282C, 282ND and 315A in the name of my noble friend Lord Young of Cookham. I must tell my noble friend—at the risk of him heaving a sigh—that that these issues are legally complex. What is more, unfortunately, his amendments will not address all those complexities. I can none the less reassure him and your Lordships that officials are working on producing a fix for the lease extension issue and that we will bring forward legislation as soon as possible. We are also considering carefully how we might address any unfairness produced by the issue of jointly owned properties, which my noble friend’s Amendment 282ND seeks to address. I am therefore not delivering a rebuff to my noble friend; I am simply urging him to understand that this is a set of issues that requires very careful legal dissection and working through, and that is what we are doing.

Finally, Amendment 282NF, from the noble Baroness, Lady Pinnock, and Amendment 309A in the names of my noble friend Lord Young of Cookham and the noble Baroness, Lady Pinnock, would require government to report on progress in remediating buildings under 11 metres and resident-owned buildings and to outline plans to expand the Cladding Safety Scheme. I listened to the views of the London Fire Brigade as reported by my noble friend; however, it is generally accepted that the life safety risk is proportional to the height of buildings. Lower-cost mitigations are usually more appropriate in low-rise buildings.

Given the small number of buildings under 11 metres that are likely to need remediation, our assessment remains that extending the protections for leaseholders in the Building Safety Act or our remediation funds to buildings below 11 metres is neither necessary nor proportionate. Where work is necessary, we would always expect freeholders to seek to recover costs from those who were responsible for building unsafe homes, not innocent leaseholders. Therefore, we do not intend to expand the Cladding Safety Scheme to incorporate these buildings, nor will it be possible to report on progress.

That said, I can assure the House that any resident whose landlord or building owner is proposing costly building safety remediation for a building under 11 metres should raise the matter with my department immediately, and we will investigate. Separately, the reporting that is already in place on the Responsible Actors Scheme will include progress made on all buildings in scope of that scheme, including any that are resident-owned. My noble friend Lord Young stated that resident-run buildings are excluded from the protections. They are not; the only buildings that are excluded from the protections as a class are those that are enfranchised, not those managed by residents. We have committed to consider this further and will bring proposals forward shortly.

I hope that what I have said has demonstrated to noble Lords that there are misunderstandings running through the amendments in this group. I have tried to provide reassurance, which I hope will be sufficient for the noble Earl, Lord Lytton, to withdraw his amendment. I also hope that my noble friend Lord Young and the noble Baroness, Lady Pinnock, will not see fit to press their amendments when they are reached.

[The Earl of Lytton (CB)]

My Lords, first, I thank all noble Lords who spoke in our debate on these amendments. It has certainly given me considerable food for thought. I am grateful to the noble Lord, Lord Young of Cookham, who went through all the promises that have been made but have not yet been dealt with one by one.

I believe that the exclusions are down to the funding assumptions that the Government have made from inception. I go back to something called the consolidated advice note, which, as noble Lords may recall, rather put the cat among the pigeons in terms of how extensive the problem was. Then there was a subsequent attempt to row back, as it were, on the worst effect of that by virtue of the independent expert statement, which itself came 11 months after a disastrous fire concerning Richmond House in the London Borough of Merton. I think we can all see that a process of risk management and managing political exposure is involved here. Unfortunately, that does not cut the mustard for a lot of people will still be stuck, for what seems to me to be an indefinite period, with the problems that they have.

--- Later in debate ---

I have also made it plain that I do not see any reason for this untimely, rushed and ill-considered proposal to take the Building Safety Regulator away from the Health and Safety Executive in the first place, and that is why I also have Amendments 267 and 268. I thank the noble Earl, Lord Lytton, for his support on that. The amendments seek to remove the two offending clauses from the Bill, thereby making it a better and shorter Bill. We will come to that in due course.

[The Earl of Lytton (CB)]

My Lords, I added my name to Amendments 267 and 268 tabled by the noble Lord, Lord Stunell. I think perhaps I should also have added it to Amendment 265A which he so ably introduced. There is very little that I can add to what he has said, so I will be brief.

As the noble Lord said, this is do with reputation, the disruption of potential reorganisation, a loss of momentum—which I might call continuity—and, finally, whether this lays open the opportunity for diluting the process which we agreed in the Building Safety Act and which one believes is still important today.

There are two things that I would like to point to. Part of the justification for what the Government seek to do seems to be a need to keep their options open, if I can put it that way, in relation to the awaited second Grenfell inquiry. Of course, we do not know when that will come in, but the fear seems to be that it will make recommendations that the Government will need to move resolutely to deal with. However, to try to foretell, forestall and provide for that by the process of taking the Building Safety Regulator function out of HSE and putting it in a place as yet unknown or undefined seems entirely premature. I am with the noble Lord, Lord Stunell, in the sense that does not aid the cohesion of the Building Safety Regulator function going forward.

The second thing that concerns me is that we already have two standards for dealing with what might be described as a defect. One is specified in the Building Safety Act and the other, which is not worded the same, is the standard of remediation under the pledge that constructors will sign up to. There are concerns, in particular because, under remediation schemes to which a lot of firms have signed up, they will still be using their own approved inspectors to sign off that work. We know what has happened since approved inspectors were brought in under the Building Act 1984. It amounts to marking their own homework. While I am sure that in many instances that is being done diligently, we would not be where we are now had that been done effectively, conscientiously and objectively. There are concerns that the Government’s proposals here leave too much wiggle room. I am with the noble Lord, Lord Stunell, on all three of his amendments, which I think afford valuable safeguards that we should take real notice of.

[Baroness Taylor of Stevenage (Lab)]

My Lords, before commenting on the specific amendments in this group, I thank the noble Baroness, Lady Scott of Bybrook, for responding so thoroughly to questions that were raised on this issue following our previous debate on this subject and the debate in July on the statutory instrument on the Building Safety Act.

Amendment 264 clarifies that the functions of the new regulator are those of the Health and Safety Executive. This was one of the points on which we requested clarification. I hope the Minister can clarify in response to the points made earlier by the noble Lord, Lord Stunell, what the new regulator will look like.

My noble friend Lord Rooker’s amendments would introduce a requirement on the new regulator to report on electrical safety for tower blocks awaiting remediation. That seems a very reasonable step in the light of previous discussions, and we hope the Minister will confirm that this falls into the remit of the regulator.

My noble friend also suggested, in his further amendment to Clause 223, that a new electrical safe register be introduced and, in particular, that electrical installations and testing be subject to the same level of rigour as gas installations. I cannot think of any reason why that should not be the case. I hope that, should she not clarify it today, the Minister will take that back to her department to be discussed with the new regulator.

Concerns expressed in Amendments 265A, 267 and 268 are that provisions made under the Bill could be revoked by regulation. Amendments 265 and 266 perhaps deal partially with that, but they may not be strong enough to deal with the concerns about provisions in the Building Safety Act. We note Amendment 265A in the name of the noble Lord, Lord Stunell, relating particularly to the potential for government to use regulations to amend the provisions of the Building Safety Act. We would be seriously concerned about that, so, if the noble Lord chooses to test the opinion of the House on that topic, he will have our support.

Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

Committee stage
Thursday 20th April 2023 Lords Chamber

[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.

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[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.

--- Later in debate ---

The noble Earl mentioned Historic Houses. I am meeting its director general, Ben Cowell, next week, so I will be happy to discuss the matter more with him. He also mentioned the Listed Property Owners Club which, by definition, covers properties which are already listed and therefore have the protections that come with that. The Government are confident that the removal of compensation will encourage local planning authorities to make greater effective use of the building preservation notice process, thus helping to better protect our nation’s most important historic buildings from potentially harmful alterations or extensions, or demolition.

[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.

--- Later in debate ---

Tabled by

[The Earl of Lytton]

245: Clause 98, page 108, line 19, at end insert—
“(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.

Amendment 245 not moved.

--- Later in debate ---

I am not saying that was the right policy or the wrong policy, but it was one that should not have been made by the stroke of a pen in secondary legislation— unamendable—and that could not be properly debated, and on which local thoughts and views could be taken more properly into consideration. If the Government are to push on with Clause 101, I hope they will think about ways whereby some of the powers can be constrained, in light of the way we have seen the envelope of the power being pushed very greatly in the past.

[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.

Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

Committee stage
Tuesday 18th April 2023 Lords Chamber

[Lord Bradley (Lab)]

My Lords, I will speak to my Amendment 219A, which has been attached, rather inelegantly, to this group. I fully support the amendment on housing for older people so eloquently moved by the noble Lord, Lord Best. I declare my interests in the register, particularly as chair of council at the University of Salford.

My amendment is straightforward, but the issue is important. However, I will be brief. The amendment seeks to add a requirement that, in the development of local plans, the housing needs of students are taken into account by fully consulting local higher education providers and housing and planning authorities in that process.

We are all aware that there is a significant undersupply of student accommodation across the country—this has been widely reported in the media throughout this academic year. It is a particularly acute problem in our cities, including Manchester, where I live—but there are also reports from Durham, Bristol, Glasgow, Brighton, Nottingham, London and many more. The student accommodation charity, Unipol, reports that UK student housing is reaching a “crisis point” as bad as in the 1970s. Just before Christmas, Property Reporter said that the student rental market is reaching “breaking point”. Furthermore, purpose-built student accommodation specialists Cushman & Wakefield report that new-build schemes are failing to keep pace with demand, at the same time as supply is being lost from the private rented sector, with many landlords switching from student accommodation to rental for professionals because of a more compelling business case, lower management requirements and more consistent demand.

As a consequence, we know that students are forced into accommodation they cannot afford; are forced to live far away from the university they are attending, with consequential higher travel costs; or are choosing unsuitable, or even unsafe, accommodation. This has a detrimental impact on the health and well-being of students, as well as significantly undermining the overall student experience. The situation has clearly been exacerbated by the current cost of living crisis.

The Government have made their position clear. In response to a Written Question in the other place, Robert Halfon, Minister of State for Education, said:

“Neither the Department for Education nor the Department for Levelling up, Housing and Communities have made … an assessment”


of student housing. He went on:

“It is for local areas, through their Local Plans, and in response to local needs and concerns, to determine the level of student accommodation required in their area. Universities and private accommodation providers are autonomous. The department plays no direct role in the provision of student residential accommodation, whether the accommodation is managed by universities or private sector organisations.”


That is absolutely clear, and we must therefore consider local solutions to the problem.

If we look across the country, we see examples of good practice, such as in Nottingham, where the city’s student living strategy explicitly involves collaboration between the universities and the local council to ensure that Nottingham realises the many socioeconomic benefits that students bring, without putting pressure on the local housing stock. But such collaborations can be more difficult in places such as Greater Manchester, where you have many higher education providers and 10 district planning and housing authorities trying to co-ordinate the demand and supply of accommodation of many thousands of students.

The student union in Salford, ably led by its president, Festus Robert, and working closely with student unions across Greater Manchester, have been in discussions with the Mayor of Greater Manchester to try to address this problem. However, this complication could be overcome through this amendment. It will introduce a statutory requirement at the local level, with the development of local plans, to ensure the collaboration of all interested parties—principally, universities and local authorities—to take into account the housing needs of the students when they are developing their local plans.

This important issue must be tackled, and I hope that my amendment will ensure that it is. I also hope that the agnosticism of certain noble Lords will be overcome by my argument. It clearly chimes with the purpose of the Bill and, more broadly, with the devolution agenda. In that spirit, I hope that the Government will support it today.

[The Earl of Lytton (CB)]

My Lords, I will speak to this group of amendments, doing so as a property professional. For very many years, the development process, housebuilding and the construction process have not been far from my daily life—at any rate until a few years ago, when I ceased to do that sort of thing on a day in, day out basis throughout the week.

I will start with the point raised by the noble Lord, Lord Lansley, in his superb explanation of the matter. I will throw some light on that, because, whether you have targets or whether you make an allocation at local level, none of these of themselves build a single unit of residential accommodation. There is a stage in between that is occupied by a commercial cohort of developers and housebuilders. I have worked for a few—although not recently—so I have no intrinsic bias against developers and housebuilders. They are, after all, the delivery system whereby the government targets will be met and, ultimately, one assumes, the affordability and availability of housing for those who need it and wish to occupy it will be delivered. However, they control the build-out rate—the more so if they control large strategic sites.

So far as I have a current interest, it is one that occupies an area within a local authority within which I reside and involves sites that are not many miles from where I live. To give one example, there is a site 6.5 miles from where I live, next to a major town, with consent for 2,700 homes. The consent was granted some years ago. Material commencement within the normal three-year period was made to construct the access. So far, the school—which I am told is fully occupied —and about two dozen houses have been built, but not much else. So, although it may fall short of what I might call the Letwin definition of land banking, it is an expandable pipeline of balance sheet assets that is not about delivery as such, but rather about managing profit and income streams.

It is very easy to make that material start and preserve your consent more or less in perpetuity. There has been some recent case law where that has wobbled a bit, but I will not go into that.

Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

Committee stage
Wednesday 22nd March 2023 Lords Chamber

[Lord Best (CB)]

My Lords, I support Amendments 441, 443, 444 and 446 on the theme of short-term lettings, tabled by the noble Lord, Lord Moylan, the esteemed chair of your Lordships’ Built Environment Committee, on which I am honoured to serve. I also support the amendments from the noble Lord, Lord Foster of Bath, on data sharing and safety.

I share the worries relayed very forcefully in submissions to our Built Environment Committee over the loss of long-term rented homes because of landlords switching to short-term lettings—propelled not least, it seems, by a tax and regulatory regime that favours the latter. As the noble Lord, Lord Moylan, has said, our debate last Monday covered a lot of the issues that have been debated in our committee and are now the subject of these probing amendments. Noble Lords gave much support on Monday to earlier amendments that advocated a registration or licensing scheme—the two could look very similar. The Built Environment Committee favoured local discretion in introducing a national scheme locally, since some places have virtually no short-term lettings. It would be very bureaucratic to have a scheme applied there. The Government are also committed, as well as to a registration scheme, to taking a regulatory arrangement forward, and I hope that we can hear news from the Minister of a timetable in this regard.

In addition, there was support on Monday for the proposition from the noble Lord, Lord Young of Cookham, and the noble Earl, Lord Devon, endorsed by the noble Baroness, Lady Hayman of Ullock, and the noble Lord, Lord Foster of Bath, for new use classes, which would enable planning powers to be used to control numbers of short-term lets in each local authority. The Government are consulting on that proposition, which personally I would favour; it deserves attention, alongside some tweaks to remove perceived incentives in the tax and regulatory frameworks, which currently appear to encourage landlords to end longer-term lets and switch to Airbnb-style short-term rentals.

I add to the debate one extra ingredient: the international dimension. In this digital age, the Airbnb phenomenon for accommodation, like Uber for transport and Amazon for retail, is ubiquitous and has caused concern in sectors in most other advanced economies. Many different regulations have been applied in other countries, particularly in tourist hotspots. A report from the Property Research Trust last year, Regulating Short-Term Rentals: Platform-based Property Rentals in European Cities, describes numerous efforts to face this challenge. Amsterdam has a strict permit system, with fines of about £20,000 for failure to comply. Barcelona has banned all short-term rentals, even in private homes. In Ireland, those areas of the country designated as rent-pressure zones have tough restrictions. In parts of the United States, such as San Francisco and Boston, only properties with the host living there during the stay are allowed to be operated as short-term lets. This international perspective demonstrates that we are not alone in facing this problem. We have a greater problem of scarcity of rented housing than most of our neighbours, which suggests that an effort to get to grips with the downside of short-term lets may be overdue here.

I have one final point. Amendment 444 reflects the Built Environment Committee’s firmly held view that new arrangements should not deter any home owners from letting spare rooms on a short-term basis. The current tax-free position, allowing up to £7,500 per annum, encourages the use of underutilised assets and brings extra income that can help with rising mortgage costs. The amendment emphasises the value of continuing that favourable tax regime for owner-occupiers in underoccupied homes.

I hope that the Government will be bold in following the lead of many other countries. We need to address the pain and disruption being caused in particular locations by the growth of short-term lets that replace badly needed longer-term rented homes. I support the amendments.

[The Earl of Lytton (CB)]

My Lords, I too support these amendments, particularly the lead amendment in this group, moved by the noble Lord, Lord Foster of Bath, about the gathering of better data. I will try not to repeat what I said last time, other than that I have some skin in the game here in the sense that I jointly own properties that are let on assured shorthold tenancies, as well as short-term holiday let properties.

This is a multifaceted issue. Second homes may, at other times, be part-time holiday lets. Holiday lets may be for leisure trips one minute and for business purposes another, and they may alter from season to season. They may be for a couple of days at one point, or a couple of weeks or three months at another point. It is very difficult to make a one-size-fits-all assumption when you are dealing with short-term lets, holiday lets or even assured shorthold tenancies.

The platforms are also equally variable: it could be booking.com—a very common one—Airbnb, an owner’s own website, word of mouth, a card in the window of the local convenience store, or a repeat booking. They are all means of people getting in contact. I know this for a fact, because the only one that does not affect the properties that I am involved with is Airbnb as we do not use that platform, but I know lots of people who do. In respect of what the noble Lord, Lord Best, said, the thing about a platform such as Airbnb is its slickness and convenience for users—both lessors and prospective occupiers. That has really made it a benchmark worldwide phenomenon and has driven its operation and popularity as much as any wish to shift from one to the other.

I contacted a local estate agent down in the West Country—not one I use but I knew somebody in the place—and asked them what was happening with short-term lets as against assured shorthold tenancies, for example. They deal with a lot of such tenancies; they are one of the main agents in that area. I was told that, while there is considerable demand for assured shorthold tenancies—often 20 or 30 applicants for each—there were very few cases of an AST being terminated for the purpose of moving the property to a short-term letting. There was nearly always some other reason for ending the AST: it was a pot of money that the owner wanted to put into some other investment, such as extending another house or helping a child with a house purchase in another part of the country.

I do not know, therefore, how frequent this supposed transfer is. Organisations such as Shelter say that they have lots of people coming along saying that they have been kicked out because the owner wanted to do an Airbnb-type letting, but I do not know whether that is an essentially urban phenomenon—it may be—or more general. I just do not think that we have the data. That goes back to the point that the noble Lord, Lord Foster, made: we need better data.

I would worry about attempts to jump to conclusions about what we do here. I follow the noble Lord, Lord Moylan, the chairman of the wonderful committee of which I am a former member, but I worry about attempts to jump to conclusions, particularly because we have not had the results of the Government’s own thinking on this, and particularly when applying these user types to a range of properties that equally has a very considerable breadth—from a shepherd’s hut at one end through to a static caravan and to a permanent dwelling. Some may be suitable only for seasonal use: I think of the very large caravan parks that—“decorate” is the wrong word—“appear” in places such as the Pembrokeshire Coast National Park. I cannot say that I regard them as beautiful or a benefit to the environment, but they clearly fulfil a seasonal requirement.

There are some settlements—some seaside places and holiday hotspots—that are built on tourism. That is what they are there for, almost, and the fact that they empty themselves for parts of the year is not a particularly modern phenomenon. I remember when as children we used to go on holiday to a part of Cornwall on an annual basis, and just about every other house was advertising bed and breakfast. Those bed and breakfasts may have morphed into Airbnb, or a short-term let on some other platform. Noble Lords have mentioned that there are clearly problems associated with an imbalance of property uses, but as the noble Lord, Lord Moylan, confirmed—I raised this point on Monday —these are not consistent, geographically or by type. They tend to be associated with hotspots of one sort or another. We need to understand the dynamic.

The noble Baroness, Lady Hayman of Ullock, picked up on the point I made that we need to flesh out a great deal more what is happening here. If we do not know the purposes and drivers behind what is happening in any given instance then we are not going to get near to creating viable policies for the purpose. Let us make no mistake: this phenomenon is undoubtedly causing problems in certain areas. We had evidence of that in the Built Environment Select Committee when I was privileged to serve on it. What is required here is a degree of localised assessment, but based on consistent, nationally accepted data-gathering principles and analysis, so that we get a proper basis for dealing with this, and can look at and compare like with like and not be comparing apples with pears.

I entirely endorse Amendments 445B and 447, tabled by the noble Lord, Lord Foster, because I know for a fact how very important safety is within a property, particularly where there is short-term turnover of occupancy and people are not particularly familiar with the property. It is absolutely important that they are safe, and that things such as batteries in smoke detectors are checked annually and that combustion appliances have proper tests and are serviced. They should be safe and safety checked at regular intervals.

The noble Lord, Lord Foster, referred to the business of trying to get at the data on this through council tax records. He is absolutely right that this is a pretty deficient way of dealing with it. I am going to tell a tale out of school here. My wife has written on numerous occasions to the billing authority in relation to a property that has been used for holiday letting for many years, saying, “Look, this is being used pretty much year-round as a holiday unit. Should it continue to be in council tax?” To which answer there came none, and why would there? Why would any clever finance officer of a local authority decide that he was going to forgo council tax—which he collects and keeps in his kitty, thank you very much—and be the collecting agency for business rates for central government, to be redistributed according to whatever the normal formula is? The noble Lord, Lord Foster, mentioned one area where the thing is skewed; that is a second area where there is a perverse incentive not to get things in the right slot.

It gets worse. Under the “check, challenge, appeal” process that business rates operators have to deal with when dealing with the Valuation Office Agency, someone has to formally claim the property for the purposes of being its agent before they can even get the process in train to change the assessment. That is not a sensible way of doing it either. We are completely at sea on this and really need to sort it out.

Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

Committee stage
Monday 20th March 2023 Lords Chamber

[The Earl of Lytton (CB)]

My Lords, I will get the guilt off my shoulders through your Lordships’ provision of the confessional: I declare an interest as co-owner of a second home in the West Country and of two short-term let properties in the same area. All, like the house I live in, which is in another part of the country, are legacies of estates that have been broken up and whittled down. Both areas have important family historical and indeed, in some cases, national historical associations.

Having declared that, I ought also to declare to the noble Lord, Lord Foster of Bath, who mentioned the Built Environment Committee, that I was, until the latter part of January, a member of that committee, and very privileged to have been so under the chairmanship of the noble Lord, Lord Moylan, who I am pleased to see in his place, and before him, the noble Baroness, Lady Neville-Rolfe. So I am familiar with the matters that were brought before us. However, I shall leave a lot of that to one side because there has been a bit of disaggregation in the groupings here. We have group 10 coming up, in which aspects of this will recur, and I find that quite difficult to deal with: I shall try to avoid getting up then and saying the same thing all over again and boring your Lordships.

While I have involvement with both normal assured shorthold tenancy properties and short-term buy to let, I certainly do not have anything to do with keeping property deliberately empty: that would be complete anathema to me, and I say so as somebody with professional training: I am a chartered surveyor and I know that all that happens with empty properties is that they deteriorate. They are much better occupied and lived in or used in some way.

I agree with the general premise that residential properties should not be deliberately kept empty for no good reason. I know that in some areas—the City of Westminster is one—there was a thought that foreign investors were buying up high-end residential accommodation and keeping it empty under the premise that perhaps it was less valuable if it had been previously occupied. It takes all sorts, but that is a particular situation. I support the noble Baroness, Lady Hayman of Ullock, in her Amendment 166 because there is a great deal of speculation about how many empty properties there are and where they are. They are not always in the places where people want or need housing and have to live and work. So, first and foremost, there is a distribution problem, along with a numbers problem. We need to sort that out, and there needs to be better data on that.

I would go further and suggest that the reasons why a property might be empty need to be understood before we set about making dramatic changes, either to the amount that is levied or to planning, although I take the point made by the noble Lord, Lord Foster, that something probably needs to be done in some of the areas that the noble Lord, Lord Shipley, referred to—the hotspots. They are not actually everywhere; they are not in every town and city; they are in defined places. Even those who particularly object to the idea of second homes and holiday homes altogether on principle recognise—and the data seems to show—that these are in quite specific areas. They are not necessarily in holiday locations at the seaside; they can be in the middle of cities and in parts of Greater London. We need to identify that.

We should not underestimate the inventiveness of those faced with a surcharge, any more than we should fail to consider the equity of a surcharge where there is a genuine reason the property is empty. The noble Baroness, Lady Hayman, referred to that and I use the example of the Ds: death, disrepair, dispute, debt, decarbonisation and, of course, redevelopment. Sorry, “redevelopment” is not a D, but noble Lords will get my drift.

Another aspect is that if there are to be additional charges, is that for the purpose of rectifying some particular, identifiable ill or mischief that is occurring, or is it just another tax? If it is just another tax and it is going into some jolly old pot, I am not particularly keen on that. There needs to be some degree of hypothecation. If there is a demonstrable case—for instance, that empty properties affect affordability in a locality or are adversely affecting incomers who might be economically active—the tax yield generated should perhaps be devoted to that or allied purposes and not put in some general pot. Presumably the case needs to be made.

I agree that ultimately, subject to some sort of national framework and means of analysis, the decision should be for the local community to put in place—and not necessarily be dictated from on high. The authorities, having made the case, must accept that the principle stood behind that is binding on them; otherwise, we risk a rather unedifying and opaque state of affairs, where the power is invoked for one reason but implemented for some entirely different objective altogether, and I would not be keen on that. We do not need a knee-jerk reaction to all that. There needs to be a consistent methodology for assessing the nature of empty second properties or short-term letting, and the detrimental effect these are having.

The noble Lord, Lord Foster, gave a graphic account of the issue, which I know from—

[Lord Foster of Bath (LD)]

Before the noble Earl moves on to another point I raised, could I ask, through him, for the Minister to perhaps confirm that even in the current legislation as proposed, it will be possible for councils to add a premium on the council tax for empty properties? It would be for the council to determine how that money is used; for example, my own local council has already a debate on this issue and proposed that the vast majority of additional money raised will go towards the building of more affordable homes in the area—to address the problem that is now being created because of the empty properties and short-term lets.

[The Earl of Lytton (CB)]

I thank the noble Lord for his intervention, because that is exactly the point I am making about having a degree of hypothecation. In other words, it should not just go into the general purposes fund. I hope the Minister will comment on that, because there is a question of trust and transparency in this. If these things are to be robust, they will need that.

From my observations, I know that what the noble Lord, Lord Foster of Bath, said about the instances and the impact in some of these hotspot areas is true. However, we need a bit more data to get the visible, empirical facts. The noble Lord, Lord Blunkett, referred to that, and I entirely agree with him. We also need to identify the likely economic outcomes of certain actions. Letting platforms were referred to; we need an analysis of how they operate for some bits of businesses but not others, because they are doing lettings direct or whatever it may be, to get some idea of how that is functioning.

There is a bit of incoherence here. For a while, conversions into residential accommodation in rural areas were often subject to the condition that they could not be occupied full-time. They had to be occupied, effectively, as holiday accommodation. Usually, they could be occupied only for something like 11 months of the year continuously, because local authorities did not want to give consent for new, independent dwellings in the countryside; there was an objective not to add to them, which I understand.

When I attended a meeting on second homes at Exmoor National Park, it was asked why there was a reduced council tax assessment for people with second homes. It transpired that only by having the bait of self-declaration could they identify how many second homes they had in the area, so that is how they did it. I say incoherence, because one really feels that the world has gone mad in some of these situations.

There is a good deal of misinformation about what is perceived to be the vast profitability of short-term lettings. When I had the privilege of being on the Built Environment Committee, I ran a little exercise, which established what I knew: that I would be better off in headline income letting full-time on an assured shorthold tenancy. However, that would probably be not to a local person but to some writer, artist or someone who wanted a nice location. The real reason behind this is that, if you are dealing with an old stone cottage which requires constant maintenance and a lot of refitting—never mind that you may have energy issues and things breaking down; things go wrong in old cottages more than they do in new ones—you are constantly in and out. The only way you can keep control of that is short-term letting, because you can take a week out and get in there and fix the boiler and all the other things that have fallen apart. It is really not for the faint-hearted.

When you compare the weekly headline rents for short-term holiday lettings with those of an ordinary assured shorthold tenancy, you are not looking at like for like. You are not dealing with fully serviced accommodation, where all the linen and services are paid for, and where somebody just walks in and all they have to do is buy their own food and go, with all the cleaning and everything else being done in-between. All that costs money. One of the greatest litmus tests of health and well-being in these rural areas is whether you can get a cleaner or someone to fix your windows. That is the real test of what is happening in the economy. With that, I will sit down and wait for group 10.

[Lord Moylan (Con)]

My Lords, it is a pleasure to follow the noble Earl, Lord Lytton. I will speak briefly and narrowly to the point made earlier by the noble Lord, Lord Foster, in which he argued for a national registration scheme rather than one which, as the noble Earl said, the Built Environment Committee said should be available locally and at local option. The noble Lord’s reason was that having a national registration scheme would make it easier for the Government to gather large amounts of data. That is a very weak reason for what would be an astonishing intrusion into privacy and the rights of property.

I believe the noble Lord, Lord Blunkett, said that a national scheme was preferable because it could be implemented more quickly than one implemented by a local authority.

Levelling-up and Regeneration Bill

Earl of Lytton Excerpts

Committee stage
Monday 27th February 2023 Lords Chamber

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, I rise briefly in this debate to support Amendment 69 in the name of the noble Lord, Lord Shipley. When I was listening, I read it and I am actually quite surprised by what the Government are doing—the disapplication of the duty of allocate seats to political groups. It seems perverse to me that the Government would do this. We are going to bring in these county combined authorities, whereby we bring people together across large areas who were not engaged, were not involved—and we want people to participate in this. Where would you be if you were trying to join one of these county authorities and you thought, “Hang on here, I am from one political group and we control this council, but all the other councils are controlled by my political opponents. I can join here, but then I will be taken off all the committees.” Why would you do that? It just seems perverse. I would be really interested to see how the Government can justify this when the Minister responds.

I really do think that the Government need to go away and think about that. It seems only fair to me that, if you are going to bring a combined authority together and you have elected politicians in all those authorities that come together, if they are from different groups, they should have representation on the Executive. I cannot see why you would want to take them off. Surely, you would want to hear their views. They are from different parts. I know there are proposals for a combined authority covering Derbyshire and Nottinghamshire. I used to work up there, and that is a huge area. The thought that one group could be excluded from that because they were not of the same political group—the larger group there—is just perverse. I do not understand why the Government would suggest that and want to do that. I am really looking forward to the Minister’s response to justify this. I hope that, maybe, he may agree to take it back to the department and suggest that they have overstepped the mark and that it should be removed at Report.

[The Earl of Lytton (CB)]

My Lords, as this is the first time I have spoken at this stage of the Bill, I remind noble Lords of my various interests and activities. I am a chartered surveyor, a vice-president of the National Association of Local Councils, and a member of the Country Land and Business Association. Probably none of them really clashes with what I am about to say. However, I do have fundamental concerns about these CCAs. How is this extra tier going to be funded or how will it generate its own income, in whole or in part? Will they truly meet what the Minister referred to as the transparency and accountability test that he set in the previous group? Will those standards always be routed in democratic accountability and the norms and conduct to be expected thereby, or something else?

I relate to the point made by the noble Lord, Lord Shipley, about ever-greater centralism in the Bill generally. That is a disturbing trend, especially when this whole levelling-up Bill, if you like, was gazetted as something that was going be better for communities. I see the thing drawing away from everything I understand community to be, and recognised it as, when I was president of NALC. This seems to be moving in the opposite direction.

The lack of clarity and specificity, presented as a freedom of CCAs to organise and manage their own affairs to some extent, is another area which is not clear from the Bill. The real acid test is whether this will result in citizen confidence in what we are doing. It cannot be otherwise. This is not something we can do from the top down, saying, “Oh well, they’ll like it, won’t they?” This has to be rooted in confidence in communities and among the citizenry generally.

Specifically, on this clause, the associate members are a special area of what I see as potential democratic dilution. Voting or not, these associates will have position and influence in debate and the processes going on. Let us not get too hung up about precisely whether they will be voting, because they will obviously have a lot of important functions notwithstanding. But who might they be? One can think of all sorts of worthy individuals representing important sectors of the community, but what about a property developer? What about a telecoms or construction company executive, who might have a particular interest in being involved in a particular area, or an investor linked to a sovereign wealth fund? The list goes on. What about a pressure group? The real question is: do these pass the test of citizen credibility when looked at from that area, bearing in mind that this is a body that is going to add another tier to the process we have all become familiar with and, to some extent, used to?

Could the noble Earl give us some reassurance as to who these associates might be? There has to be some overarching principle that sits behind their appointment and the functions they are able to deal with. If not, we would be signing some sort of operational blank cheque to these bodies. I hope he will be able to provide me with an answer to that point, which concerns me very much.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, when I spoke earlier, I should have referred to my interest as a vice-president of the Local Government Association. I apologise to the Committee for that.

Civil Procedure (Amendment No. 4) (Coronavirus) Rules 2020

Earl of Lytton Excerpts

Wednesday 23rd September 2020 Lords Chamber

[The Earl of Lytton (CB) [V]]

My Lords, my involvement in the private rented sector is parliamentary, personal and professional. I saw the freeze on evictions as a necessary but blunt instrument due to the prevailing immediacy of circumstances and for good order, given judicial incapacity. Landlords and tenants, lenders and borrowers, the honest and the less so, and many pre-existing or unrelated issues were swept up in this. However, coronavirus cannot go on being cited for all ills.

I might have supported the Motion to Regret and the Motion for an humble Address to annul the rules had it been possible to distinguish a genuine balance of Covid-related hardship from more opportunistic practices, or indeed from unrelated pre-Covid matters. I could have done so had it been clear, on fair assessment, that the balance of hardship was invariably in favour of protecting renters and maintaining the freeze. However, I am not convinced. I note that over 60% of private rented sector landlords are owners of but one rented property. Perhaps the owner wanting to reoccupy their sole rented home, the pensioner, possibly in care and reliant on the rental income from their former home, and the buy-to-let borrower also need fair treatment or we risk serious consequences. The sector needs protection from poor tenants and poor landlords alike.

Covid ultimately affects our entire existence and economy, and we have to get back to normal somehow or other. I accept that the Government might offer financial assistance, which would ease the issue, and I would support that, but I feel that it is probably out of scope and I certainly do not believe that it is a cure-all.

Rocks and hard places apart, matters cannot just drift. The eviction freeze comes with moral hazards and abuses, and must revert to case-by-case assessment of the individual circumstances, so that landlords and tenants are subject to independent adjudication. Therefore, although the Government need to demonstrate an approach to the lacuna referred to by the noble Baroness, Lady Grender, I follow the reasoning and conclusions of the noble Lord, Lord Taylor.