Baroness Scott of Bybrook
Main Page: Baroness Scott of Bybrook (Conservative - Life peer)Social Housing (Regulation) Bill [HL]
Baroness Scott of Bybrook ExcerptsTuesday 6th September 2022
(2 years, 3 months ago)
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Baroness Scott of Bybrook (Con)
My Lords, I begin by welcoming members of the Grenfell community, some of whom are in the Gallery today, while many are watching online. I commend them for their continued engagement in this vital piece of legislation and assure them that they are never far from our thoughts and prayers.
First, I thank the noble Baronesses, Lady Pinnock, Lady Thornhill and Lady Hayman, the noble Lord, Lord Best, and others for this debate on these very important issues, which are becoming more important as energy becomes a bigger and bigger issue for the people of this country. These amendments seek to make changes to the Regulator of Social Housing’s statutory objectives and standard-setting powers and to the approach to energy efficiency in the social rented sector.
I begin with Amendment 1 in the name of the noble Baroness, Lady Pinnock, and Amendment 21 in the name of the noble Baroness, Lady Hayman. As I said, energy efficiency is an important topic, both to meet our net-zero commitments and to reduce residents’ energy bills over the long term, which we know is more important than ever at this time. Many registered providers of social housing are already striving to improve the energy efficiency of their properties. Indeed—I think this is an answer to the first question from the noble Lord, Lord Whitty—two-thirds of the sector currently achieves an EPC rating of C or above, making it the best-performing housing sector we have.
The Government are committed to considering setting a new regulatory standard of EPC C in the social rented sector and to consulting the sector before that standard is set. I am sure this is something that incoming Ministers will want to look at once they are appointed. Also, the Government committed £800 million in the 2021 spending review to the social housing decarbonisation fund, bringing the total committed to just over £1 billion. The fund will support the ambitions set out in the Clean Growth Strategy that as many homes as possible are improved to energy performance certificate EPC band C by 2035, where practical, cost-effective and affordable, and for all fuel-poor homes to reach that target by 2030.
As well as achieving good standards on average, many providers are already including net-zero considerations in their long-term planning and recognise the importance of improving energy efficiency. In the Heat and Buildings Strategy, published in October 2021, we committed to consider setting a new standard on energy efficiency in the social rented sector and that we would consult the sector before doing so. This part of the process is vital. Setting targets such as those proposed in Amendment 21 would exert significant financial pressure on social landlords who must balance differing spending priorities. We need to know whether spending on net zero might come at the expense of being able to deliver much-needed new housing and, importantly, home repairs.
That is why we must ensure that plans to decarbonise social housing are properly scrutinised and that we understand the broader impacts of any proposed metrics and standards. A full consultation and impact assessment would be a key step to understanding the impact of new standards on social landlords and on residents—who will benefit most from improved energy efficiency.
I assure the noble Baroness that improving energy efficiency in the social rented sector is a priority. The regulator already requires providers to meet the decent homes standard, which requires efficient heating and insulation. Including energy efficiency in the regulator’s objectives would therefore be only a symbolic change. Changing the objectives to include an already existing duty would be, in my opinion, a duplication.
I agree with the comment from the noble Baroness, Lady Hayman, that much of the debate that we have had this afternoon should possibly be taken in the Energy Bill as well. It is important that it is not forgotten.
The noble Lord, Lord Whitty, brought up the issue of the planning system and pleaded for incentives for regeneration rather than demolition and rebuild. I have to say that I agree with those sentiments but I do not have the answer. I will write to the noble Lord and will put a copy in the Library.
On communal heat networks, raised by the noble Baroness, Lady Hayman of Ullock, the Government have confirmed—I think I mentioned this in an answer to a question today—that network customers who will not be reached by the Energy Bills Support Scheme will be supported with an equivalent scheme, which is very good news. We are also taking powers in the Energy Bill to rectify the situation and Ofgem will regulate this in the future.
I now move on to Amendment 4 in the name of the noble Baroness, Lady Thornhill, and the important issues of cladding remediation and fire safety. The noble Baroness, Lady Pinnock, brought up the funding for replacement of usage of non-ACM cladding. The Government have committed to £400 million to replace unsafe ACM cladding, and a £4.5 billion fund to remediate unsafe non-ACM cladding on residential buildings over 18 metres or just below in all sectors. There is money there for non-ACM cladding.
Nothing is more important than keeping people safe in their homes. The Bill is just one of a number of reforms that the Government have delivered in response to the Grenfell Tower fire; this includes this year’s Building Safety Act and last year’s Fire Safety Act. The department continues to work closely with registered providers to look at ways to make sure that buildings with unsafe cladding are remediated quickly. However, we are not persuaded that this type of monitoring is appropriate for the Regulator of Social Housing to undertake. While the regulator collects data from registered providers to inform its regulation of the standards, it is not a specialist health and safety body. The regulator’s data collection powers enable it to collect only data relevant to its regulatory functions. Significantly, its regulatory remit does not extend to monitoring the progress of cladding remediation.
The department is currently examining options for monitoring and reporting remediation progress in future, including cladding remediation. We strongly believe that decisions in this area should be based on thorough analysis of available options; this will ensure that the function is undertaken by those with the correct skills, expertise and capacity. Consequently, it would be counterproductive to pre-empt the outcome of this work by adding this amendment. I am, however, keen to reassure the noble Baroness that ensuring that landlords provide safe, high-quality social housing remains a key part of the regulator’s role.
I now turn to Amendments 2 and 22 in the names of the noble Baroness, Lady Thornhill, and the noble Lord, Lord Best, respectively, which relate to the regulator’s role regarding homelessness. The Government are committed to tackling homelessness before it occurs; this year we provided local authorities with £316 million in homelessness prevention grant funding. Since the introduction of the Homelessness Reduction Act 2017, over half a million—510,930—households have been supported into secure accommodation. We have made excellent progress on our manifesto commitment to end rough sleeping and will build on this progress through continued work with our range of partners. To deliver our vision, we have brought forward a bold new strategy to end rough sleeping and we have pledged £2 billion over three years to deliver on this ambition by supporting local authorities and partners to deliver on this strategy. It will continue to be the role of local authorities to consider how their allocation policies support those in need of social housing, including people who are homeless. It differs very much, depending on where that local authority is and its demography.
While we expect landlords to treat everyone with respect and deliver a high-quality service to all, the measures in the Bill are targeted specifically at existing social housing residents. This is to enable the regulator to monitor compliance with its standards, supporting improved services for residents.
The regulator’s existing tenancy standard already sets an expectation that providers take account of the housing needs and aspirations of tenants and potential tenants, and assist with local authorities’ strategic housing function. This includes homelessness duties. Providers are also required to provide services that will support tenants to maintain their tenancy and prevent unnecessary evictions. I also note that the regulator plays a vital role in ensuring that providers are financially viable and well managed, which protects tenants from situations that would put their housing at risk. Following the passage of the Bill, the regulator will review and consult on changes to the regulatory standards, including the tenancy standard.
The Deputy Chairman of Committees (Baroness Fookes) (Con)
My Lords, I remind Members of the Committee that only the first amendment in a group is moved until such time as it is reached on the Marshalled List.
Baroness Scott of Bybrook (Con)
I thank the noble Baronesses for tabling amendments on these important issues. This group of amendments primarily relates to the Regulator of Social Housing’s monitoring and enforcement powers.
Amendment 3 relates to compensation. I begin by stating that registered providers of social housing should always seek to rectify problems relating to the housing they provide. In certain circumstances, where they do not do so and continue to fail their tenants, it is right that tenants are compensated for the suffering caused as a result of these failings. However, I must reject this amendment.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Lords for tabling these amendments, which all relate to the implementation and review of the Bill. Before I start, I will respond to the issue raised about social housing rents by the noble Baroness, Lady Jones, as it does not really fit in to this debate. I would just say that we are consulting on setting a ceiling on rent increases in 2023-24. The consultation sets out several options for the ceiling; responses will be considered once the consultation closes, which we expect to be in a short time rather than a long time.
I will begin with Amendment 5 in the name of the noble Baroness, Lady Pinnock. The noble Baroness is right to highlight the importance of social housing supply, but also that it is not just about any houses; it is now very much about specific housing—housing for older people and families as well as for disabled people and vulnerable people. The Government are committed to increasing the amount of social housing but also to looking at the prioritisation of specific housing for specific groups.
Housing will be provided through our £11.5 billion affordable homes programme and I think it entirely appropriate that the regulator should have an objective to support the provision of social housing. However, I do not accept the noble Baroness’s request that it should be the regulator’s role to assess the need to increase the provision of social housing or to make recommendations as to how that might be achieved. There are many other organisations, such as the Chartered Institute of Housing, Savills and Shelter, which publish reports on these important issues at regular intervals.
I am concerned that asking the regulator to fulfil this role would not only be unnecessary but divert resources and attention from its important responsibilities, such as registering providers, setting standards in social housing, assessing risks across the sector, conducting financial checks of providers and carrying out enforcement action where needed. Instead, I believe that the regulator should continue to support the provision of social housing through its work to ensure that private registered providers are financially viable, efficient and well-governed. This in turn helps to ensure that the private registered providers can obtain funding to enable them to deliver more social housing.
Amendment 12, in the name of Lord Foster of Bath—who has already given part of my response—concerns the electrical safety consultation. As the House has already heard, we fulfilled our commitment to consult on electrical safety in social housing and the consultation closed only last week. In my opinion, it would not be right to pre-empt its outcome before carefully reviewing the responses we received. However, the Committee may note that the Electrical Safety Working Group, which included representation from across the social sector, was supportive of mandatory electrical safety checks, and I would not be surprised if the outcome of the consultation chimed with those views. However, it is only fair and reasonable that we do not pre-empt the final consultation.
Amendment 24, in the name of the noble Baroness, Lady Pinnock, relates to directions issued by the Secretary of State to the Regulator of Social Housing. The amendment would require the direction relating to information and transparency to be laid before both Houses. There is already an established process for issuing directions to the regulator, set out in Section 197 of the Housing and Regeneration Act 2008. The process requires that any direction be published in draft and subject to consultation ahead of being formally issued. This provides an opportunity for stakeholders, including parliamentarians in both Houses, as well as members of the public, to have a say on the drafted direction before it comes into force. In our opinion, this already provides sufficient opportunity for scrutiny of the information and transparency directions before they come into effect.
Amendment 27 in the name of the noble Baroness, Lady Hayman of Ullock, relates to timetables for performance monitoring of registered providers. Clause 21 of the Bill enables the regulator to deliver tenant satisfaction measures, including setting dates for the publication of such data and the period it covers. As the body granted legal powers through Clause 21, it is right that the regulator, not the Secretary of State, decide matters relating to timing of performance information. The regulator has already consulted on these matters and will respond in due course.
Amendment 52, tabled by the noble Baroness, Lady Pinnock, concerns scrutiny of the impact of the Bill. The Government recognise the importance of appropriately reviewing the impact of legislation. We will work with the regulator, and the Housing Ombudsman where appropriate, to conduct a full review at the end of one regulatory cycle to determine the impact of the measures introduced. This will be after four years of the new regulatory regime being in place. We committed to that in our regulatory impact assessment, and I am happy to commit to it again today.
The commitment to a review after a four-year cycle is important for two reasons. First, following the passage of this legislation, a number of steps will need to take place before the proactive consumer regime is implemented in full. These include the Secretary of State issuing directions to the regulator and the regulator subsequently consulting on the revised consumer standards. A review after one year would not allow sufficient time for those changes to take effect. Secondly, it is right that we wait for a four-year regulatory cycle, at which point the measures will have had time to take effect and have had full impact on the sector.
Amendments 53 and 65 have been tabled by the noble Baroness, Lady Hayman of Ullock. The former would mean that the entirety of the Act came into force on the day it was passed, and the latter would require an assessment of the impact of this legislation’s timing. The noble Baroness asked me one very important question: why has the Bill taken so long to be introduced? We spent time listening to residents, hearing first hand about their experiences and how they wanted to see change. Over 8,000 residents contributed to these discussions. We published our social housing White Paper in November 2020. This is a complex process and programme, and we want to make sure we get it right, so it will take time for us to fully implement it.
The legislation will have a significant impact on the lives of social housing tenants across the country, and the measures will be implemented at the earliest appropriate opportunity. The majority of the provisions in this Bill will come into force on such a day or days as the Secretary of State may appoint by regulations. The timing of commencement is directly linked to the overall implementation of the strengthened consumer regulation regime, and we need to allow time for the sector to prepare.
The Regulator of Social Housing has already begun its work to develop this new regime. It plans to commence its statutory consultation on the regulatory standards following Royal Assent and the issuance of directions from the Government, with a view to full implementation in 2024. However, the message to registered providers is clear: do not wait for regulation to make changes—act now. I hope that noble lords are satisfied with the responses I have given to the amendments, and I ask that the noble Baroness withdraw her amendment.
Baroness Pinnock (LD)
My Lords, I thank the Minister for her detailed response. I note that my noble friend Lord Foster of Bath is probably the only person this afternoon who is receiving a positive “thumbs-up” response, to his determined campaign for electrical safety. That is one win for my noble friend, and some “maybes” for the rest of us.
I have listened carefully to the answers the Minister gave to the amendments in the name of the noble Baroness, Lady Hayman of Ullock. I will check because some of them sounded acceptable, but I am not sure about leaving the regulator to determine the timing of the impact. I will read Hansard to see whether those issues should be pursued further.
That brings me to Amendment 5, on the sufficiency of housing, which is fundamental to any debate on social housing provision. I am sorry to say that I had a bit of difficulty with the response. It is all very well saying that other organisations provide statistics and scrutinise social housing provision numbers, quality, decency and so on, but we need in our legislation a regulator or the ombudsman to be able to state the facts and comment to the Government—and to have the stature to do so.
I will read what the Minister said carefully, but the essence of the argument seems to be, “There are other people who do it, so why should the Government?” The regulator should be concerned with housing numbers because it is required to think about and has a responsibility for the safety, provision and quality of social housing. Adding “sufficiency” to its list of responsibilities would be a positive move. However, I accept the Minister’s supportive words on not only the number of houses but their suitability. With those comments, I beg leave to withdraw my amendment.
Baroness Sanderson of Welton (Con)
My Lords, I will speak to Amendment 30 in this group, but I first apologise for not being able to speak at Second Reading. Secondly, I declare my interests, as set out in the register, as someone who works with both the Grenfell community and Theresa May, who I shall mention in a moment.
The Grenfell Tower fire exposed a host of social housing issues, but in terms of this amendment it is important to highlight one in particular: the stigma that existed then and exists now, and which will continue to exist unless we take practical steps to do something about it. As the Green Paper on social housing showed, and as Theresa May said as Prime Minister:
“Some residents feel marginalised and overlooked, and are ashamed to share the fact that their home belongs to a housing association or local authority. On the outside, many people in society—including too many politicians—continue to look down on social housing and, by extension, the people who call it their home … Our friends and neighbours who live in social housing are not second-rate citizens.”
But for that issue to be addressed, those friends and neighbours must not be treated like second-rate citizens, not just by those on the outside but those on the inside, whose job it is to manage their homes.
We know from the Grenfell Tower inquiry what happens when the job is not done properly, when there is poor management and maintenance, no care and no respect, and when repeated pleas fall on deaf ears and people begin to lose hope. We also know that this was not a one-off. As the noble Lord, Lord Whitty, alluded to, the work done by Daniel Hewitt of ITV News and Kwajo Tweneboa on social media has proved beyond doubt that this is a widespread and deep-rooted problem.
I am not sure how we can expect the sector to improve unless we take active steps to professionalise it. We need to encourage people into the profession, to instil a sense of pride in what can be a difficult but rewarding career, and we need to recognise the essential part that social housing managers play in creating a thriving community, alongside our teachers, nurses and social workers, all of whom we expect to be qualified. As one resident of Grenfell Tower who was here earlier said, “You wouldn’t send your child to a school where the teacher was unqualified.” A properly functioning social housing system is just as important to a child’s welfare as its education.
As has been mentioned, it was the Conservative manifesto of 1951 that stated that housing
“is the first of the social services”.
It went on to say that
“work, family life, health and education are all undermined by crowded houses.”
The argument then was about numbers, and it still is—but it is also about standards and acknowledging the modern-day complexity of these roles. By registering social housing managers and ensuring that they have relevant qualifications, we can begin to drive up standards. As Shelter has pointed out, it also means that it will be better equipped to support residents suffering from domestic abuse or racial harassment, or who may be caught up in youth violence or harassment by criminal gangs.
The Government have already recognised the need for improvement, and they have launched a review. I appreciate that they need time to respond to that review, but if the response is not going to be available as the legislation progresses, it would be a terrible irony if that became the reason to reject this amendment, which is measured and reasonable in scope. It is not asking for that training to be made mandatory now; it is merely asking that the Secretary of State be given the power to establish requirements for qualifications and training in regulations. That seems reasonable to me, and this is the right legislation in which to place this power. If we miss this opportunity, it could be years before there is another chance. The Grenfell community has waited long enough for the change we promised them.
Doing it now will also allow the Government to be fleet of foot—a rare occurrence—when the time comes for professionalisation, as it surely will. Awareness of the problems in social housing is growing all the time, and with it so will calls for professionalisation. Meanwhile, we should be aware that lawyers representing the bereaved and survivors at the Grenfell Tower inquiry will be proposing professionalisation in their submissions concerning future recommendations, which will be heard later this year.
Instigating this change does not need to involve the creation of a whole new body. As my noble friend Lord Young mentioned, the Chartered Institute of Housing has an existing framework of qualifications, professional registration and a code of ethics and values, and this could all take professionalisation forward. There may need to be some tweaking, of course, but the infrastructure is already there. To that end, will the Government consider this amendment as one which will bring meaningful and lasting change?
I have probably spoken for long enough, but I leave the last words to the Grenfell community. As I have said before in this place, and as is relevant again now, they want Grenfell to be remembered not for what happened on the night but for all the positive actions that have flowed as a result. They believe passionately that professionalisation can be one of the most important elements of the legacy they have fought so hard for, for many years. We owe it to them to give this proper consideration.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Baroness, Lady Hayman of Ullock, and the noble Lord, Lord Whitty, for tabling amendments relating to tenant engagement.
I begin with Amendment 6, in the name of the noble Baroness, Lady Hayman, which would require the regulator to consider appointing persons from different regions of the United Kingdom to the advisory panel. I hate to do this, but I point out that the Bill relates to the regulator of social housing in England alone. Therefore, it would be inappropriate to require representation on the advisory panel from the regions across the United Kingdom. That is a technicality that I should point out.
However, I understand that the aim of the amendment is to ensure that the panel is made up of a range of views. The social housing White Paper made it clear that the purpose of the panel was to provide independent and unbiased advice which would support the transformative change needed and build trust with tenants and social landlords across England. I am more than happy to put it on the record that I am clear that this means that the advisory panel has to be properly representative. I know that the regulator is fully committed to ensuring that that is the case. I am also sure that future Ministers will take a keen interest in ensuring that the advisory panel is delivering the broad representation we expect.
The noble Baroness, Lady Hayman, asked whether councils will be on the advisory panel. The Bill specifies a number of groups that must be included on the advisory panel. That includes councils, and we would expect the regulator to seek diverse views, including among local authorities. She also asked whether the Government will review the temporary nature of the advisory panel. As previously mentioned, the new regulatory regime will be reviewed after a four-year regulatory cycle, and that includes the advisory panel and its effectiveness. However, the panel is not envisaged to be a temporary body; it will continue to offer advice to the regulator on the discharge of its functions.
The noble Baroness, Lady Thornhill, said that she believes that prescribing factors that must be considered in deciding who makes up the panel is unnecessary and could tie the hands of the regulator. I agree—in fact, it might hamper the regulator’s ability to balance a range of factors to get the best range of views. The regulator already has several mechanisms for engaging with stakeholders, including a non-statutory advisory panel, which includes engagement with representatives from across regions within England. I hope that this reassures the noble Baroness that the Government are committed to ensuring that the panel is representative, including voices that reflect issues and views from across the country—that is, England.
Amendment 7 in the name of the noble Baroness, Lady Hayman of Ullock, would require a social housing tenant to chair the advisory panel and to have responsibility for setting its agenda. I am sympathetic to what drives this amendment—empowering tenants and ensuring they have a voice, which is what the Bill is all about—but I do not agree that it is desirable for the legislation to specify how the panel should operate or who may lead or set the agenda in this way.
I should make it clear that the panel is intended to allow a collection of diverse voices to share their knowledge and opinions with the regulator. I would also expect the advisory panel, with the regulator, to shape how it works and what it considers. I do not believe that having a tenant set the agenda, as chairman of the panel, is necessary to ensure that the views of tenants are heard. The Government also want the panel to consider the full range of other regulatory issues that the regulator has to tackle. While consumer issues are rightly at the forefront of the Bill, we are determined that the importance of economic regulation should not be diminished. A requirement for a tenant to chair and set the agenda would not support what we are trying to achieve. As I have said, in practice I expect that all members of the advisory panel, along with the regulator, will shape its agenda and how it operates.
I now turn to the important Amendment 30, also in the name of the noble Baroness, Lady Hayman of Ullock, which relates to professionalisation of the social housing sector. It is supported by the noble Baroness, Lady Thornhill, the noble Lord, Lord Whitty, and my noble friends Lord Young of Cookham and Lady Sanderson of Welton, and I will speak more about it in a bit. We know how important it is that social housing staff carry out their roles with a high degree of professionalism. That is why our social housing White Paper committed to review professional training and development in this sector, and to consider the appropriate qualifications and standards for social housing staff in different roles, including senior staff. To inform the review, we established a working group made up of resident groups, landlords, professional bodies and academics. We also commissioned independent research and undertook fact-finding visits to gather a wide range of evidence. We are now considering the most effective means of improving professionalism in the sector.
The noble Baroness’s amendment would allow the Secretary of State to set a requirement for persons engaged in the management of social housing to hold specified qualifications and undertake ongoing professional development, such as participation in or completion of a specified programme or course of training. We agree that these proposals have merit, and that tenants should have access to staff who listen and respond to their needs. That is why is it important that this matter be given proper consideration, which I can confirm very strongly is being given at this time. To answer the question of the noble Baroness, Lady Hayman of Ullock, as I have said, we are working hard to fully assess the merits of different options to address this important issue and we will set out the Government’s preferred approach as soon as possible. I can assure the Committee that I will talk to the Minister personally, whoever that may be, to reflect the views of the Committee on this important issue.
I thank my noble friend Lady Sanderson of Welton not just for her input into this debate but for all the work she has done to support the Grenfell community since the fire. We all know that she has put in a lot of work, time and effort—thank you. This is probably not what the Committee wants to hear, but I will take this on personally and come back to Members who have shown interest before we get to Report with a new Minister.
I turn now to Amendment 47 in the name of the noble Lord, Lord Whitty, which concerns the regulator’s powers to intervene if a ballot on issues such as regeneration and stock transfer is not being conducted reasonably, transparently or equitably. Ballots are an important way for landlords to involve tenants in the decisions they take. We expect consultations to be meaningful and genuinely seek to hear and act on the views of tenants. Guidance is readily available on resident engagement in regeneration, and statutory guidance on local housing authority stock transfers covers consultation requirements.
In addition, tenant involvement and empowerment is a core part of the regulator’s consumer standards. Where a registered provider is proposing a change in landlord or a significant change in management, the regulator expects registered providers to consult in a fair, timely, appropriate and effective manner. The Bill strengthens the regulator’s ability to intervene if a provider is systematically failing to consult fairly with tenants. Tenants will be at the heart of the new consumer regulation regime, and the views of social housing tenants and other sector stakeholders will play a crucial part in shaping it. Following these reassurances, I ask noble Lords not to press their amendments.
“(ba) in subsection (3), omit the words from “not” to the end;”Member’s explanatory statement
This amendment makes a consequential amendment to section 108 of the Housing and Regeneration Act 2008 which is needed following the addition of the new offence by clause 3 of the Bill.
Baroness Scott of Bybrook (Con)
My Lords, the amendments in this group relate to economic regulation and refinements to the regulatory framework, as well as fee-charging powers for both the Regulator of Social Housing and the Housing Ombudsman. Amendments 20 and 46 deliver the social housing White Paper commitment to ensure that the regulator is notified if there is a change in who controls a registered provider. At present, there is no obligation for registered providers to notify the regulator where such a change occurs. This may be detrimental to effective regulation, as a change in control can be a clear indicator of substantial changes to a registered provider’s business model or governance structure.
Amendment 20 sets out the circumstances that constitute a change of control. First, it introduces a new Section 169CC into the 2008 Act. Broadly, this requires the regulator to be notified if more than 50% of the board members of a registered provider change in a 12-month period. Secondly, a new Section 169CD requires notification where a registered provider becomes or ceases to be a subsidiary of another legal person, such as another body. Amendment 46 defines “subsidiary” in relation to this provision. I believe this a sensible change that will ensure the regulator is notified of significant changes that might affect a provider’s business model and/or governance structure.
I turn now to the amendments relating to the Housing Ombudsman. Clause 31 will improve complaint handling in the social housing sector by empowering the Housing Ombudsman to issue new types of orders and placing the complaint handling code on a statutory footing. Amendment 49 seeks to take this further by placing a duty on the Housing Ombudsman to monitor the compliance of its member landlords with the complaint handling code. This will identify the landlords that are not meeting the standards set out in the code. The ombudsman may then issue these landlords with complaint handling failure orders to rectify any issues identified and, if required, refer the matter to the regulator.
Government policy is to maximise the recovery of costs of arm’s-length bodies, which both the Housing Ombudsman Service and the regulator already seek to achieve. Amendments 50 and 51 clarify that the Housing Ombudsman is able to fund all its costs through fees charged to member landlords. This would include the cost of enforcement activities, whether those activities were connected to that member or not, such as the costs incurred by any compliance monitoring activities required to meet the duty set out by Amendment 49. This will maintain consistency with the current funding model for the Housing Ombudsman, which is 100% funded by member landlords.
The Regulator of Social Housing will see substantial growth in its regulatory activity when the new consumer regulation regime is implemented, which means that its costs will increase significantly. As a number of noble Lords pointed out at Second Reading, it is important that the regulator is provided with the funding to enable it to deliver the outcomes this Bill seeks to achieve. However, certain activities are currently not charged for. Amendment 10 will ensure that the regulator can recover an even greater part of its operating costs from the sector.
New subsection (4A) will make clear in the legislation that the powers available to the regulator to charge fees include charging for costs that may be unconnected with the specific fee-payer. For example, this would ensure that the costs of investigation and enforcement activity can be recovered through fees. This amendment also enables the regulator to charge all applicants an application fee, not just those that are eventually successful. The regulator is required to consult on any significant changes to the fees regime, which will enable stakeholders to have their say on how a new fees regime will work. Fees principles are also subject to approval from Ministers.
I turn now to other, more minor amendments in this group. Amendment 25 seeks to remove Sections 198A and 198B of the Housing and Regeneration Act and replaces Clause 20 of the Bill which solely removes the serious detriment test. Amendments 23, 26, 31, 34 to 42, 45, 57, 58, 61, 63 and 64 mean that as well as removing the serious detriment test, the overarching grounds for the use of monitoring and enforcement powers are replaced by appropriate, tailored grounds for each of those powers. These changes do not mark a major change from the existing regime but provide greater clarity on the grounds for the use of the regulator’s powers.
Amendment 43 makes changes which will allow the regulator to use the power to appoint board members where there are none, but an officer remains, addressing the gap that currently exists. This amendment also clarifies that the regulator can appoint officers where a provider has failed to meet a regulatory standard. Amendment 44 makes clear that the regulator does not need to wait until the expiry of a term of appointment of an officer before renewing the appointment. It is vital that the regulator can act decisively and effectively, and Amendments 43 and 44 support this goal.
Amendments 8, 9, 60 and 62 remove redundant text setting out maximum levels of fines for offences under the Housing and Regeneration Act 2008, now that the Legal Aid, Sentencing and Punishment of Offenders Act 2012 has removed these limits in practice.
Amendments 13, 16 and 18 extend existing moratorium provisions to unincorporated charities. The housing moratorium is an important protection as it provides time for the regulator to work with a provider and secured creditors to try to find the best solution where a provider gets into financial difficulty. Amendment 55 clarifies that all charities are subject to the existing accounting requirements in Section 135 of the Housing and Regeneration Act 2008. Section 135 sets out the expectations on charities in relation to their accounts, including, for example, the requirement on a charity to prepare a balance sheet for each period that gives a true and fair view of the state of affairs of the charity.
Sections 129 to 133 of the 2008 Act contain requirements in relation to accounts of registered providers that are companies. Amendment 15 applies these provisions to limited liability partnerships, or LLPs. Section 120 of the 2008 Act sets out requirements for the regulator to notify other relevant bodies where it registers or deregisters a social landlord. At present, the requirements do not apply in relation to registered providers that are LLPs. Amendment 14 extends Section 120 to LLPs. Section 122 of the 2008 Act restricts the making of gifts and the payment of dividends and bonuses by a non-profit registered provider. Amendment 54 expands subsection (6) of this provision, which allows for the recovery of wrongful payment, so that it applies to non-profit registered providers of all types.
These amendments will help ensure that the correct regulatory framework is in place, and that both the Regulator of Social Housing and the Housing Ombudsman are able to recover costs to deliver maximum cost recovery. I commend these amendments to the Committee.
Baroness Scott of Bybrook (Con)
My Lords, I have so much paperwork here, so may I please read that question in Hansard? I will make sure that the noble Baroness receives a timely response. I will also put it in the Library and send it to all Members who have taken part in this debate.
(a) in the words before paragraph (a), after “107(6)” insert “or (6A)”;(b) in paragraph (a) omit the words from “not” to the end”Member's explanatory statement
This amendment makes a consequential amendment to section 108 of the Housing and Regeneration Act 2008 which is needed following the addition of the new offence by clause 3 of the Bill.
“Power to charge fees(1) Section 117 of the Housing and Regeneration Act 2008 (fees) is amended as follows. (2) In subsection (1)(a), after “fee” insert “for dealing with an application”.(3) After subsection (1) insert—“(1A) The regulator may make dealing with an application for initial registration conditional upon the payment of the fee.”(4) In subsection (2) omit “initial or”.(5) After subsection (4) insert—“(4A) The amount of a fee payable under this section may be calculated by reference to costs incurred, or likely to be incurred, by the regulator in the performance of any of its functions, including costs unconnected with the fee-payer and costs unconnected with registration or regulation under this Part.”(6) In subsection (5)—(a) in paragraph (a), for “expenditure on” substitute “the costs incurred in”;(b) omit paragraph (b) (but not the “and” following it);(c) in paragraph (c), for “to which it relates” substitute “incurred, or likely to be incurred, in the performance of the regulator’s functions”.”Member's explanatory statement
This makes it clear that the regulator may charge fees for dealing with applications for registration (even if unsuccessful) and may require payment in advance. It also makes clear that fees may be set at a level to cover all of the costs of the regulator, including, for example, costs unrelated to the registration process.
Baroness Hayman of Ullock (Lab)
My Lords, my Amendment 33 is in this group. It would mean that the Secretary of State must bring forward an affirmative SI to make provisions for monitoring the compliance of social housing with the Homes (Fitness for Human Habitation) Act. I think we can all agree that there is not a lot of point in having a standard if it is not complied with. I hope that, by recognising that, the Minister will consider accepting my very simple amendment.
I have also added my name to Amendment 29, so ably introduced by the noble Lord, Lord Best. As he said, it would impose a duty on the social housing regulator to carry out regular inspections of all registered providers to ensure compliance with the regulatory standards. This is incredibly important, which is why I was very pleased to add my name to his amendment. He introduced it in such a way that we are all very clear why it is needed and would be an important improvement to the Bill, if accepted.
As it currently stands, reactive investigations are an important aspect of the system, but, unfortunately, they often come too late and sometimes they are too heavily reliant on other parts of the system revealing issues. We know that self-reporting by landlords can mask the scale or severity of problems and that action is sometimes not taken until it is too late. We need properly designed routine inspections that can be done at short notice so that we can uncover issues in a more timely manner and, most importantly, act as a deterrent to poor service and ensure that good practice is an everyday responsibility for landlords and their staff.
As we have heard from the noble Lord, Lord Best, when the Government introduced the social housing White Paper, they promised routine, Ofsted-style inspections. In this way, we would deliver a truly proactive system of regulation of social housing. As the noble Lord said, if we are genuinely to deliver what the Government seem to want with the Bill, we must ensure that good standards, right across the board, are delivered within the system. Having such inspections would help to achieve that, which is why we fully support his amendment.
I move to Amendment 11, in the name of my noble friend Lord Whitty, which we also strongly support. His amendment to recognise the impact of unsafe or overcrowded conditions on mental health and well-being is incredibly important. A lot is talked about the impact of poor housing standards on physical health; not enough is talked about their impact on mental health, so we strongly support his amendment.
Finally, I come to the opposition to Clause 4 standing part from the noble Lord, Lord Young, who, as always, introduced it very clearly and effectively. He was absolutely right when he said in his introduction that we need clarification of the roles of and relationship between the regulator and the Housing Ombudsman. He talked about the overlapping of their responsibilities and the importance of avoiding confusion and duplication. If this is to be truly effective, everyone must know their role and each role must be effectively delivered. I shall be interested to hear the Minister’s response and to see whether the Bill could be amended by the Government to try to bring clarification so that we do not get confusion once this becomes law.
I finish by saying that we have had a number of excellent discussions today on the Bill and I look forward to working with the Minister to positively move forward the issues we have raised today.
Baroness Scott of Bybrook (Con)
My Lords, I thank my noble friend Lord Young, the noble Baroness, Lady Hayman, and the noble Lords, Lord Whitty and Lord Best, for tabling these amendments, which all relate to changes to the proposed proactive consumer regulation regime. I shall start with the opposition to Clause 4 standing part, raised by my noble friend Lord Young of Cookham. The noble Baroness, Lady Pinnock, and my noble friend Lord Young asked questions on the blurred lines and lack of understanding as to who does what. I shall try to explain.
Member's explanatory statement
This amendment is consequential on the amendment to Schedule 2, page 35, line 35 in the Minister’s name.
(a) in subsection (1), omit the words from “that” to the end;Member's explanatory statement
Section 108 of the Housing and Planning Act 2016 contains restrictions on when a person may take steps to enforce security over property of a private registered provider. This amendment extends the provisions so they apply to any private registered provider, whatever form it takes.
Member's explanatory statement
This amendment is consequential on the amendment in the Minister’s name to insert a new clause after clause 16.
“Notification of change of control(1) The Housing and Regeneration Act 2008 is amended as follows.(2) Before section 169D (and the heading immediately before it) insert—“Notification of change of control
169CB Application of rules about notification of change of controlThis group of sections does not apply to local authorities.169CC Change in board members(1) A registered provider must notify the regulator if—(a) the board members of the registered provider change (whether as a result of an appointment or removal of a board member or for any other reason), and(b) following that change, any of the circumstances described in subsection (2) arise.(2) The circumstances are that—(a) the number of board members of the provider has increased by more than 50% since the beginning of the relevant period;(b) the number of board members of the provider has decreased by more than 50% since the beginning of the relevant period;(c) more than 50% of the board members of the provider are persons who were not board members of the provider at the beginning of the relevant period.(3) For the purposes of this section, the “board members” of a registered provider are—(a) in the case of a registered charity which is not a registered company, its charity trustees within the meaning given by section 177 of the Charities Act 2011;(b) in the case of a registered society, the members of its committee within the meaning given by section 149 of the Co-operative and Community Benefit Societies Act 2014;(c) in the case of a registered company, its directors within the meaning given by section 250 of the Companies Act 2006;(d) in the case of a limited liability partnership, its members.(4) For the purposes of this section, “the relevant period” is—(a) the period of 12 months ending with the day on which the change mentioned in subsection (1)(a) takes effect (“the 12 month period”), or(b) if the registered provider was not a registered provider throughout the 12 month period, the period—(i) beginning with the day (or, if more than one, the latest day) in the 12 month period on which it became a registered provider, and(ii) ending with the day on which the change mentioned in subsection (1)(a) takes effect.169CD Change in subsidiary statusA registered provider must notify the regulator each time—(a) it becomes a subsidiary of a person, or(b) it ceases to be a subsidiary of a person.””Member's explanatory statement
This amendment places a registered provider under a duty to notify the regulator if certain events occur. The events are ones which may affect control of the provider.
Member’s explanatory statement
This is consequential on the amendment, in the Minister’s name, to substitute clause 20 with a new clause.
“Failure to meet standards: exercise of intervention powersOmit sections 198A and 198B of the Housing and Regeneration Act 2008.”Member's explanatory statement
Clause 20 of the Bill amends section 198A to remove the test of “serious detriment” before powers can be exercised. This amendment replaces that with a clause repealing sections 198A and 198B. These sections set out general grounds for exercise of powers. Instead, amendments are made to the powers themselves (where necessary) to adjust the grounds on which they can be exercised.
Member’s explanatory statement
This is consequential on the amendment, in the Minister’s name, to substitute clause 20 with a new clause.
Member's explanatory statement
This amendment is consequential on the amendment, in the Minister’s name, to insert a paragraph 8A into Schedule 3 to the Bill (which contains amendments of section 252A of the Housing and Regeneration Act 2008) and also corrects inconsistent use of language in the paragraph inserted into section 252A.
“(za) for subsection (1) substitute—“(1) The regulator may hold an inquiry into the affairs of a registered provider if the regulator suspects that—(a) the affairs of the registered provider may have been mismanaged,(b) the registered provider has failed to meet a standard under section 193, 194 or 194A, or(c) there is a risk that, if no action is taken by the regulator or the registered provider, the registered provider will fail to meet a standard under section 193, 194 or 194A.””Member's explanatory statement
This adjusts the grounds on which the regulator can hold an inquiry and is linked to the repeal of sections 198A and 198B of the Housing and Regeneration Act 2008 (see the amendment, in the Minister’s name, to substitute clause 20 with a new clause).
“Meaning of “subsidiary”(1) In section 271 of the Housing and Regeneration Act 2008 (meaning of subsidiary and associate), for subsections (1) to (5) substitute—“(1) A person (“A”) is a subsidiary of another person “B” if—(a) A is a subsidiary undertaking in relation to B for the purposes of the Companies Acts (see section 1162 of, and Schedule 7 to, the Companies Act 2006), or(b) A would be a subsidiary undertaking in relation to B for those purposes if “undertaking” were defined for those purposes to mean any person.”(2) For the purposes of section 74 of the Housing and Regeneration Act 2008, the amendment in subsection (1) applies in relation to leases granted on or after 10 June 2022.”Member's explanatory statement
This widens the meaning of “subsidiary” in Part 2 of the Housing and Regeneration Act 2008 so, amongst other things, it applies to bodies other than companies.
“11C A duty of the housing ombudsman to monitor compliance with a code of practice described in item 11A that it has issued.”Member's explanatory statement
This requires a housing ombudsman scheme to place a duty on a housing ombudsman to monitor compliance with a code of practice on complaint handling (if the ombudsman has issued one).
“10A In section 122 (payments to members etc), in subsection (6), for “registered company or registered society” substitute “registered provider”.”Member's explanatory statement
This expands the provision about the recovery of wrongful gifts or payments so it applies to all non-profit registered providers.