Housing and Planning Bill

Lord Mackay of Clashfern Excerpts

Monday 11th April 2016 Lords Chamber

[Lord Tope (LD)]

My Lords, my name is added to these amendments. I am very grateful to the noble Baroness, Lady Hayter, for her tribute to my noble friend Lady Tonge, who first introduced me to this subject and then told me that she was handing it over to me. I am not sure that she has completed the process, but that is what happened. This is the third Bill that I have attempted to amend in this way. The previous two were under the coalition Government, so I am very pleased that we are now making some progress.

I welcome the movement from the Government and their Amendment 82, but I echo all the points that have been made by the previous two speakers—particularly the noble Baroness, Lady Hayter, who introduced our amendments very well. It is good to see at least a positive step and a willingness to consider the issue, but I simply do not understand why the Government’s amendment uses the word “may” and not “must”—why the provisions are not mandatory, as they should be.

Electrical safety has been left behind. Quite rightly, we have had regulations relating to gas and carbon monoxide; why not for electrical safety? I hope that the Minister will be able to indicate that the caution in the amendment does not reflect the Government’s position and that they do intend to regulate on this issue and are not merely proposing a gentle amendment which they hope will buy us off at this stage.

I shall not repeat all the things that the noble Baroness, Lady Hayter, said but I want to add one that I do not think has been mentioned tonight. There are any number of examples of why electrical safety is important and of the dangers when proper checks are not made. Perhaps it is my age but I was shocked to read that nearly two-thirds of properties occupied by couples over the age of 60 do not meet electrical safety standards. From that it follows that in 2013-14 half the fatalities from electrical fires were of people aged over 65. Those statistics alone ought to be shocking enough to indicate that it is time for the Government to make this check mandatory.

We have dealt with the question of costs. According to Electrical Safety First, the five-yearly check being called for will cost in the region of £150. I accept the arithmetic of the noble Baroness, Lady Hayter, that £150 every five years works out at £2.50 a month. That is no argument at all against having the check, even if the cost were considerably greater.

Similarly, we feel that the term “qualified” in this context means nothing at all. Electrical Safety First certainly feels that, and in fact it says that it is meaningless. The person carrying out the check needs to be property-competent. Again, we would welcome reassurance from the Minister that the Government will take that on board when they draft the regulations, if indeed today they can give us a firm commitment not that they “may” produce regulations but that they “will” produce regulations.

[Lord Mackay of Clashfern (Con)]

I am just wondering whether it is possible to have complied with subsection (2) of the proposed new clause and still be in breach of subsection (1).

[Baroness Evans of Bowes Park]

My Lords, Amendments 82 and 92, if approved by the House, will provide an enabling power that will allow the Secretary of State to set requirements for electrical safety in private rented properties, and their enforcement, through secondary legislation. I am conscious that this is an issue that many noble Lords feel strongly about, as we have heard again today, and it raised considerable debate in Committee. Following the words of the noble Baroness, Lady Hayter, I, too, extend my sympathies to the noble Baroness, Lady Tonge.

The Government are taking a measured approach to this issue. Should Amendments 82 and 92 be approved by the House, we will continue our research and work with the sector to explore further the detailed options for regulation. This will allow any regulations to be introduced once the policy has been finalised, ensuring that they are beneficial and strike the right balance. The Government’s amendments have been welcomed by the sector, including Shelter, which said in its blog of 5 April:

“Put simply, they tabled a life-saving amendment”,

which is,

“a striking signal from the Government that they are serious about tackling rogue landlords and poor conditions”.

Amendment 33 would introduce requirements for landlords to organise regular electrical safety tests in their rental properties. As I have already stated, we have tabled an amendment to create an enabling power which would allow the Secretary of State to set requirements for electrical safety through secondary legislation at a later date. It will allow further research to be conducted and ensure that the requirements are balanced and beneficial to the sector as a whole. Should our amendment be approved, it will give us the time fully to understand all the potential impacts and assess all options.

--- Later in debate ---

[Lord Beecham]

My Lords, this amendment deals with property guardianship schemes, a term with which I was entirely unfamiliar until I read about them in, appropriately enough, the Guardian last December. The situation originally arose when the owners of properties—often commercial properties—who were unable to sell or improve them for the time being wanted them protected. The owners allowed people to go in unlicensed to live there on moderate terms until such time as they could proceed with redevelopment, demolition or whatever.

As a concept it was workable and satisfactory to many people. But latterly it has changed. It has now become a commercial enterprise in which, I have to say, a number of ruthless owners are exploiting people who are not tenants—they have no rights; they are merely licensees—charging quite considerable sums of money for them to live in places that are, very often, unsatisfactory from the point of view of the conditions in which they have to live, with absolutely no security of tenure of any kind.

This prompted me to put down an amendment in Committee, where I quoted the experience of some people who had been through this system. One guardian described rooms that were “like chicken coops” in a place in Kennington offered by a guardian company—that is the euphemistic phrase—for £500 a month. It was a single space with rows of plyboard walls and no natural light or ventilation. In another place, carpets had been worn and stained by thousands of shoes that had crossed the floor of what was a council’s now defunct one-stop shop. Office furniture was piled high next to windows caked with soot, letting in the gloom from Commercial Road. The toilet light did not work. To wash, the guardian had to descend two flights of stairs to a dirty, windowless room, where the guardian company had installed a temporary shower. Other people in the property also used it. The Government should—this amendment seeks to compel them to—apply the same terms as to fitness for human habitation and repairing obligations that apply to proper tenancies under the Landlord and Tenant Act to these guardianship scheme contracts.

The Minister who is to reply to this debate is a different Minister from before. The buck has been passed and I sympathise with the Minister who is replying to this debate. The noble Baroness, Lady Williams, and I had an exchange of views—our usual civilised correspondence—in which she acknowledged that,

“property guardianship schemes have a range of drawbacks. The properties that are used are frequently derelict commercial or industrial buildings that were never intended to be used as accommodation and may be in an unsafe condition with inadequate physical security. Occupiers pay a fee to occupy part of the building, are responsible for securing it and preventing damage. However, they are not tenants and do not therefore have the right to exclusive possession of any part of the building. In addition, they can be required to leave at very short notice. The Government does not encourage such schemes but I do recognise that recent media reports suggest they are becoming more widespread. It is very important that anyone considering living in such a building clearly understands the limitations of these schemes and that they will have very limited rights. My department will therefore publish a short factsheet on its website which highlights the fact that the Government does not endorse these schemes, explains that buildings may frequently be unsuitable to be used as accommodation and that an occupier of such buildings has very limited rights”.

With all due respect to the Minister and perhaps those in the department who produced this response, it is very unsatisfactory given the kinds of conditions that I briefly described by quoting just a couple of examples.

That follows a rather difficult exchange with the noble Baroness, Lady Williams, in Committee where she made much the same points about being sympathetic and concerned. She said then:

“The Government do not support the schemes, as the guardians can be asked to live in conditions which do not meet the standards expected in residential properties”.

However, the reason given for not doing anything was that she did not believe—or, in all fairness, the Government did not believe—

“that it would be appropriate to require that Sections 8 to 17 of the Landlord and Tenant Act should apply to guardianship agreements”.

I found that entirely puzzling. If the Government are sympathetic to the plight of the people in these places, applying Sections 8 to 17 would not convert them to the status of tenants but would simply apply to those people conditions which apply to the tenants of residential properties. When I challenged her on this, the Minister said,

“if the noble Lord is talking about the property guardianship schemes, it is because they are arrangements between a building owner and one or more individuals, and the arrangement is temporary. They are not intended to provide stable alternative accommodation”.

However, that does not exempt the Government from protecting people in that position. I find it inexplicable that the Minister was falling back on her brief, which she is entitled to do, but that the brief in turn simply asserted that as there is no tenancy agreement, the Government did,

“not think that the Landlord and Tenant Act actually applies”.—[Official Report, 9/2/16; col. 2223.]

Well, it does not and would not without the Government legislating for that purpose. That is the point of the amendment. As the Government are so clearly aware of this growing problem—there are now reckoned to be more than 4,000 people living in these dreadful conditions—I cannot think why they cannot simply accept that these people should benefit from the limited but essential requirements of the relevant parts of the Landlord and Tenant Act which would be applied specifically by legislation for this purpose. I cannot think why the Government have so far declined to do that.

Unless there is an assurance from the Minister that she will take this issue back and return to it at Third Reading, I will seek to test the opinion of the House. I hope that we can make progress on this issue. It is not a party or divisive point. It is a simple enough matter which the Government should respond to more constructively and helpfully than they have done hitherto. I do not blame Ministers for that. I suspect that someone in the department has not grasped the reality of the situation. I beg to move.

[Lord Mackay of Clashfern]

This is an extremely worrying situation, as the noble Lord, Lord Beecham, explained it. I am not at all clear about the fact that this provision appears to apply the tenancy provisions that are applicable to all guardianship contracts. The noble Lord has already explained clearly that these are not all residential properties; some are commercial. I wonder whether the guardianship arrangements are suitable for people who live in the accommodation, which cannot be of a very high standard to come under the guardianship scheme. Therefore, I wonder whether it is possible to build something satisfactory on a foundation so unsatisfactory as a guardianship scheme for residential property.

[Baroness Evans of Bowes Park]

My Lords, I reiterate the point made by my noble friend the Minister during our previous debates. We as a Government do not endorse these schemes and do not have any plans to introduce new regulation in this area as we believe that doing so could be regarded as tacitly endorsing the use of property guardianship schemes as a legitimate housing option. As the noble Lord said, while there has been some suggestion in the press that these schemes are becoming more widespread, we do not have any evidence that this is in fact a growing sector, nor has there been any pressure from campaign groups and others to take action in this area. People are free to make their own housing choices and the Government do not have any plans to stop the use of property guardianship schemes. Occupiers pay a fee to occupy part of a building and are responsible for securing it and preventing damage. However, they are not tenants and do not, therefore, have the right to exclusive possession of any part of the building. In addition, they can be required to leave at very short notice. However, it is very important that anyone considering living in such a building clearly understands the limitations of these schemes and that they will have very limited rights.

As the noble Lord said, my noble friend has proposed that the department will publish a factsheet on its website which highlights the fact that the Government do not endorse these schemes and draws attention to their clear drawbacks, including the fact that the buildings may frequently be unsuitable to be used as accommodation and that an occupier of such buildings has very limited rights. With that explanation, I ask the noble Lord to withdraw his amendment.