Inequality

Debate between Jo Swinson and Iain Wright

Thursday 27th November 2014 Commons Chamber

[Mr Iain Wright]

I am glad the Minister has put that clarification on the record. She is galloping away somewhat, rather like executive pay over the past 30 years. May I bring her back to the Government’s reforms? In respect of binding votes, how many companies have had to change their pay policy as a result of shareholders voting against it?

[Jo Swinson]

I will talk about the particular reforms in a moment. There are two ways in which the Government’s reforms can have an impact on executive pay and, therefore, company behaviour when agreeing directors’ remuneration. One way, obviously, is to have a binding vote that a company could lose, and as a result the pay policy would not go forward. The other way—it is an important one—is that companies, because they know they will face a binding vote on executive pay, will be incentivised to have more detailed discussions with investors and shareholders in advance of the annual general meeting. I would not want us to get into a situation in which we thought that it was only if lots of votes were won that the reforms were not successful, when actually it might be a sign that there is much more engagement, which in itself would be a sign of success.

[Jo Swinson]

I certainly think that the points the right hon. Gentleman made about involving the work force are important. That is why our reforms require that it be set out how employees have been involved and consulted. It is not a prescriptive approach, but it requires that to be taken into consideration. Indeed, the Government have tried in other ways to influence corporate governance. For example, the work we have done on employee ownership has supported different types of ownership and engagement models, through various changes to the tax system and the provision of materials on how to make it easier for companies to convert to employee ownership models, so that employees can be much more involved in the running of their companies. We know that that can have real business benefits, because employees buy much more into the success of the company. That also starts to deal with some of the productivity issues that the hon. Member for Hartlepool mentioned.

[Mr Wright]

The Minister is making a very important point, and I really agree about the need to ensure that employees have a say in the running of their businesses, because that improves the value of those companies. Could that be formulated within corporate governance? Does she agree with the notion of having employees on remuneration committees?

[Jo Swinson]

I think there is a difference between recognising and supporting business benefits, and prescribing in legislation or regulation exactly how companies should go about doing that. There is a lot of agreement on the advantages for companies, but I do not think there is much agreement with the idea that the best way is for the Government to be very prescriptive, stating, “This is exactly what companies must do, and this is the only way to do it.” There are different ways in which companies can achieve that level of engagement successfully. It might be through employee representation on the board or remuneration committee, but there are other ways in which that can be done. We should enable companies to find the way that works best for them.

We are monitoring the impact of the reforms we are undertaking in the context of the 2014 reporting and annual general meeting season. We want to understand how companies have interpreted and applied the regulations, what trends can be observed in the remuneration packages that have been put forward and how shareholders have responded. We intend to publish the key findings from that work shortly, along with any policy conclusions that flow from them. We have always said that the policy will remain under review, because we want to see how what we have implemented works in practice.

Of course, it is useful for the Government to take on board and consider interesting proposals made in the House, in the context of looking at how our reforms are actually working. We know from the evidence already available that companies are increasingly responding to shareholder expectations on remuneration. There are positive signs of restraint on levels of directors’ pay and a substantial number of companies have simplified their remuneration policy, linking it much more closely to measurable performance over longer periods of time—that is crucial—to try to get away from the short-termism culture.

There have been reports in the media about rising pay, but often they reflect the impact of previously agreed pay awards. What matters most in assessing the impact of the reforms is what pay is being awarded under the new regime. The latest evidence shows that the median total remuneration awarded to FTSE 100 CEOs fell by 5% in 2012 and by a further 7% in 2013. Some 35% of those CEOs and 30% of the executive directors did not receive a salary increase at all last year. The median salary increase for FTSE 100 executive directors overall was 2.5%. Only 16% of companies gave their directors a salary increase of more than 3%; in the previous year that figure was 25%. The trend shows that pay is coming down, but obviously we will want to look at all the evidence that comes forward before publishing those findings and having a clearer picture.

The right hon. Member for Oldham West and Royton talked about the importance of engaging investors in the process. That ties in closely with the work my right hon. Friend the Business Secretary is doing on long-termism, particularly the Kay review, because investment funds, pension funds and so on have a crucial role to play as active investors. Important campaigning bodies have certainly achieved some success in getting much more engagement from those investors, so that they can properly hold to account the decisions on pay.

On the specifics of pay ratios, overall ratios certainly give us a picture of how things are across the economy, but I suggest a degree of caution about using a ratio between the top and the bottom for paid employees within a company. We considered that very carefully when we introduced the reforms. We decided not to mandate that ratio, as set out in the motion. Transparency is welcome, but we have to guard against potentially misleading information when that is broken down between the top and the bottom.

Obviously, that will depend on what sector the company is operating in and the type of staff working for it. For example, a large investment bank that outsources all its unskilled work could end up having quite a low ratio for pay between the top and the bottom, but a large retailer with a large number of relatively unskilled employees would have a much bigger ratio. The retailer could none the less be paying above the living wage and treating its employees pretty well. It might look as though it is the investment bank that should be polishing its halo, but perhaps that is because it outsources its unskilled work to be done in less favourable conditions. Therefore, we have to be slightly careful about unintended consequences, because some factors could mask what is actually happening. Comparing top and median pay might give a more realistic and meaningful figure. The hon. Member for Hartlepool is right to point out the Liberal Democrat policy in that area—he is undoubtedly an avid reader of Liberal Democrat policy documents, as I encourage all hon. Members to be.

The hon. Member for City of Durham (Roberta Blackman-Woods) raised a number of issues that are very important as part of the discussion on inequality and pay policy, particularly the pay gap for women. At the end of last week we heard the positive news that the pay gap is closing. However, we need to be cautious about celebrating that too much when we still have such a significant pay gap. Let us welcome the fact that it is being reduced, but also recognise that our aim has to be to eliminate it.

The hon. Lady’s concerns about part-time work are also important. There is far too much stigma within the workplace about how valuable somebody can be if they work part time. Very important work is being done by organisations such as Timewise to highlight the fact that people in very senior roles can work part time and do their jobs perfectly successfully, so we should be able to deal with some of those issues.

The hon. Lady also mentioned the living wage. We obviously have the national minimum wage, which is a floor, or a basic standard. Of course, this year we saw the first above-inflation rise in the national minimum wage since 2007, which is very welcome. That gives full-time workers a £355 increase each year. We want that to continue, if possible, without negatively impacting on employment. My right hon. Friend the Business Secretary has asked the Low Pay Commission to look at considering above-inflation rises in the national minimum wage, and we hope that, with a growing economy, that can be sustained. Of course, at the same time we have focused on helping people on low pay by cutting income tax by £800 a year, taking 3.2 million people on the national minimum wage out of paying income tax. We have done a significant amount, but we want to continue by encouraging employers to pay above the national minimum wage and to recognise that it is a minimum. Very profitable and successful companies should recognise their responsibilities to their employees, which might mean that they should be paying more. I welcome the fact that many employers are now turning into a positive the fact that they pay more than the minimum wage and badge themselves as a living wage employer. Of course, they will then be able better to compete for talented staff and get business benefits.

The hon. Lady is right about happiness and well-being. In 2010, the Prime Minister said that the Office for National Statistics would be collecting data on well-being and happiness. That was not met with universal acclaim in some sections of the press. I seem to recall that the Daily Mail was not necessarily delighted by the suggestion. I, for one, was delighted, having set up the all-party group on well-being economics and long campaigned for the importance of recognising that people, yes, care about their income and the size of the economy, but also care about the health and happiness of themselves and their loved ones. The more we recognise that in our policy making and in what we measure, the better.

The hon. Lady said that she did not know what had happened to that work, so I will update her. The ONS has been collecting the information, and about 250,000 people a year are questioned. As a result, a rich databank is being built up that can be broken down in interesting ways across different geographical areas, and between men and women and different age groups, so as to be able to assess the impact of policies and see what is happening in different parts of the country in different groups.

We recently announced the setting up of a “what works centre”—a research think-tank that the Government are supporting to analyse how different policies impact on well-being. From a BIS perspective, one of the key strands of this work is about well-being in the labour market and the workplace and what drives it. We recently published research that we have undertaken on that. A range of factors impact on workplace well-being. Obviously, pay is one, but there are also things such as the variety in someone’s job, whether they feel that they get to use their skills, whether they have a degree of autonomy, how they go about their job, and their sense of fairness in the workplace, which very much ties into this debate. I am glad to say that very many businesses are also engaged in this agenda and recognise that continuing to engage with the well-being of employees leads to better business performance.

We recognise that this is a very significant issue, and we have taken action. We do not want to see rewards for failure. A ratio cap as set out in the motion could, in its purest sense, have unintended and perverse consequences. Early signs of the response to our executive pay reforms are encouraging, and we will review their impact and publish the findings. We will continue to work to ensure that pay policies become fairer, and also support low-paid workers by cutting income tax. I know that we will return to this topic in the House. I thank the right hon. Member for Oldham West and Royton and the Backbench Business Committee for giving us the opportunity to discuss it today.

Small Business, Enterprise and Employment Bill

Debate between Jo Swinson and Iain Wright

Wednesday 19th November 2014 Commons Chamber

[Jo Swinson]

So far 30 employers have been named and shamed, and, as I said in Committee, there will be a further tranche of naming and shaming shortly.

The previous system was much more permissive in terms of the number of cases in which naming could operate. Until the new rules were introduced, only one employer had been named over a period of many years. We introduced those rules on 1 October 2013, but they did not operate retrospectively, and hence applied only to investigations that began on or after that date. The previous criteria apply to the many current investigations that began before 1 October 2013, and in those cases employers are much less likely to be named. Many other investigations began on or after 1 October 2013 and are still ongoing, so the final stage of the issuing of a notice of underpayment and the consequent ability to name and shame has not been reached.

As I think has been recognised, the numbers are already increasing, but given that this is a new scheme, it is inevitable that they will start small and become larger as cases work their way through the system.

[Mr Iain Wright (Hartlepool) (Lab)]

The Minister will recall that, in Committee, I raised the issue of umbrella companies, in which people who may be receiving relatively high wages are, for a variety of reasons, subject to spurious deductions that take their earnings below the national minimum wage. Does the Minister think that the HMRC enforcement team could look into that as well?

[Jo Swinson]

The enforcement team can look into any breach of the national minimum wage, and it can enforce notices of underpayment in the case of spurious deductions. That applies even to deductions that would not be problematic if someone were being paid significantly above the national minimum wage. Some contracts suggest that employees pay for their own uniforms if they are paid significantly more than the national minimum wage; that does not necessarily get employers into trouble with the law, but in some cases it does. Obviously it is necessary to ensure that HMRC’s calculations are right, and that it has all the necessary evidence. Sometimes it takes a little time to ensure that the whole process is followed correctly, which is why cases are still working through the system.

--- Later in debate ---

[Jo Swinson]

I think that the hon. Gentleman is comparing apples with oranges. According to the most recent estimate, the number of employees who are paid less than the national minimum wage is lower than 300,000—about 236,000, I believe. I stress that that is an estimate. Obviously we do not have data on every single person in the country; such estimates are based on surveys. The figure of 30 companies is not an annual figure; those are cases that have been completed since the new rules came into force.

I can assure the hon. Gentleman that the vast majority of cases in which the national minimum wage law has been found to have been breached are being named and shamed once the notices of underpayment have been issued. Obviously there is still a job to be done: people must be informed about how they can ensure that their rights are being properly enforced. Let me say yet again that if people fear that they are not being paid the national minimum wage when they should be, they should ring the pay and work rights helpline, which is a free service and totally confidential. The number is 0800 917 2368, and I shall continue to take every opportunity to publicise it, because it is important for people to know that they can receive advice on a confidential basis and then make a complaint if they decide to do so.

Local authorities have been mentioned. I think it right that HMRC works in partnership with authorities—with some success—to ensure that enforcement happens, but I also think it right for there to be a national enforcement body. The issue of social care has been raised, along with the issue of travel time, which is well documented. Travel time, other than the times involved in travel to and from work at the beginning and end of the day, needs to be included in the national minimum wage. We are well aware of that, and HMRC is enforcing it.

We know that there are issues in the care sector. That is why targeted enforcement was carried out, and why my colleagues at the Department of Health have been working closely with local authorities to produce guidance to ensure that they contract providers who can provide quality care, along with fair terms and conditions for their work force. Authorities should not be pricing contracts at a level that prevents their basic national minimum wage obligations from being met.

Amendments 9 and 10 concern zero-hours contracts. We have already discussed the question of whether or not they are sometimes a good thing. It was the former Member of Parliament for Sedgefield, Tony Blair, who said, on 3 October 1995,

“There will be an end to zero-hours contracts.”

However, the Labour Government did not deliver that, perhaps because there are people for whom such arrangements work well, as we heard from the TUC during the evidence session in Committee.

While there are undoubtedly problems with zero-hours contracts, and I do not wish to dismiss them, I think it important to introduce some perspective to the debate. Last year the Chartered Institute of Personnel and Development conducted a survey to establish what was happening on the ground, and produced a report. It found that zero-hours contract workers were just as satisfied with their jobs as the average United Kingdom employee, that they were happier with their work-life balance, and that they were less likely to feel that they were being treated unfairly by their organisations.

[Mr Iain Wright]

Does the Minister think that the significant increase in the number of zero-hours contracts over the last four years is a positive or a negative development—or is it just a sign of a flexible employment market?

[Jo Swinson]

It certainly is a sign of a flexible employment market, which is good for the UK economy. It ensures that we are able to have a stronger economy and increased prosperity. As for whether a zero-hours contract is a good thing, that depends on individual circumstances. There are plenty of people for whom such contracts work well and plenty of people who are happy with them, but I entirely recognise that there are plenty of people who are not happy, and that there are employers who are not behaving as they should.

Some of those issues arose in the consultation on exclusivity, which is why we inserted the clauses that we are discussing. Other issues arose from it as well, and we agree that those too need to be addressed. The Opposition tabled amendments 9 and 10, and I welcome their contribution to the debate. We have argued that it is better to ensure that we can work with industry, sector by sector, in producing guidance on what constitutes responsible use of zero-hours contracts, so that employers are clearer about how they should be using them and employees can know what it is reasonable for them to expect.

Blacklisting

Debate between Jo Swinson and Iain Wright

Wednesday 16th October 2013 Westminster Hall

[Jo Swinson]

The ICO is making every effort to contact people. It is not a body sponsored by the Department for Business, Innovation and Skills, but we have discussed the issue with the ICO, and that is exactly what is happening. We recognise that there are some cases in which the process is difficult, but the ICO is determined that when it can contact people, it absolutely is doing so.

[Mr Iain Wright]

The Minister is quite rightly focusing on the construction industry, but hon. Members have mentioned other sectors. What active steps are the Government taking to find out whether there is blacklisting in other parts of the economy?

[Jo Swinson]

I have outlined the investigations that are ongoing. We do need something to go on: there is much speculation about and many suggestions of blacklisting taking place, but the relevant authorities need somewhere to start to look for it. That is why in the debates earlier this year and today I have reiterated that if anyone has information, concerns or suspicions—they do not need to have firm evidence, because it is a challenge to produce bona fide evidence when, by definition, the activity is clandestine—we will of course happily look at such evidence, as the Select Committee has done.

UK-Listed Mining Companies

Debate between Jo Swinson and Iain Wright

Wednesday 28th November 2012 Westminster Hall

[Jo Swinson]

The hon. Gentleman encourages me to fill my diary with more meetings—I am sure that my private office will be delighted. I will certainly look at whether it is possible to undertake that commitment. If he writes to me with more details, I will see what can be done.

[Mr Iain Wright]

Will the Minister give way?

[Jo Swinson]

I will. If it is another request for a meeting, the hon. Gentleman should note that I may be less minded to give way on other occasions.

[Mr Wright]

I, too, think it is impressive that, in such a short time, the Minister has met so many organisations, but the key point is action. What was the actual outcome of those 16 meetings?

[Jo Swinson]

The hon. Gentleman asks a genuinely interesting question. One thing that became clear to me at the first round table I held on this issue was that the industry and the campaigners started in quite contradictory positions. Getting people to a position where they have agreed to make progress has been a rather long and perhaps slightly tortuous process, which has required a great deal of engagement. Both sides have had concerns, but, to their credit, they have both recognised that tweaks to their proposals might be needed, and genuine points have been made that ultimately led to concessions. Certainly when I joined those discussions, we were getting to a much clearer position, particularly with the catalyst of the strong US rules, and that is very welcome. It is important to have strong rules on transparency, but the industry recognises that it must comply with the US rules, and it wants to make sure that it is not a bad neighbour, as it were, in the countries in which it operates. There is therefore a recognition that change is necessary.

The EU negotiations are in the trialogue process, the delights of which are not always as swift as we would like. We are keen to make sure that, if possible, that agreement is reached through the First Reading process, because that would allow us to implement the rules. I understand that there have been three sets of meetings so far. They are practically weekly at the moment, and I think the dates were 7, 9 and 14 November, but do not quote me on that. Things are prone to change in the EU—for example, there was due to be a meeting on Friday, but I heard it was off and then that it was possibly on again. None the less, whatever the specific dates, there are very regular meetings of COREPER—and other lovely EU acronyms—to ensure we get some progress.

On a range of issues, particularly the three I mentioned—exemptions, and threshold-level and project-level reporting—we are getting a greater degree of consensus. The European Parliament is still pushing some elements, in relation to the involvement of other parts of industry, on which it wants to go beyond what the US does. That runs the risk of just delaying or preventing the process, when there is a lot of consensus on extractives, so there will be further discussions.

As the hon. Member for Islington North (Jeremy Corbyn) explained, he has unfortunately had to leave for another engagement. He made a point about outsourcing parts of the mining industry to avoid transparency. It is worth putting it on the record that the project definition is likely to tie in contracts and licences in such a way that avoidance will not be straightforward and that subcontracting will still be captured. The hon. Member for Falkirk talked about how listing companies in London might be a positive step, even when they were not UK-based. The hon. Member for Hayes and Harlington (John McDonnell) was characteristically forthright and passionate about some of the failings that he has identified. I am sure that he appreciates why I cannot go into the individual cases that he mentioned.

On the overarching issue of corporate governance, it is important that investors have information to hold companies to account. The London stock exchange has four of the top five mining exploration and extraction companies by market capitalisation—BHP, Rio Tinto, Xstrata and Anglo American. There are 119 extractive and mining companies listed on the London exchanges, of which 12 are UK companies. We want to ensure that investors can hold boards to account and encourage responsible business behaviour. We have high standards of corporate governance, but it is important that we are not complacent. Further strengthening those standards will help London stock markets, because it will give major investors more confidence.

Enterprise and Regulatory Reform Bill

Debate between Jo Swinson and Iain Wright

Tuesday 16th October 2012 Commons Chamber

[Jo Swinson]

New clause 15 amends the definition of “estate agency work”, which determines the application of the Estate Agents Act 1979. This fulfils our commitment to introduce a measure on this issue following our recent targeted consultation, which was developed as part of the disruptive business models/challenger businesses theme of the red tape challenge.

New clause 15 extends a current exemption to that definition of estate agency work. Intermediaries, such as internet portals for private sales, will be out of the scope of the Estate Agents Act if they merely enable private sellers to advertise their properties and provide a means for sellers and buyers to contact and communicate with one another. Such intermediary businesses will therefore not be obliged to comply with requirements that are relevant to full service estate agency businesses, such as the disclosure of any self-interest in a property transaction and membership of a redress scheme for residential estate agents. These private sales businesses are not actively involved in property transactions, but offer a lower-cost alternative of enabling individuals to market their own property and buy and sell privately.

Those intermediary businesses will be able to provide a means for the seller and prospective buyer to contact one another, for example online; to provide a branded for sale board to the seller to assist this process; and to pass on to a prospective buyer solely the information provided by the seller in their advertisement, by whatever channel of communication. If, however, the intermediary offers any personal advice to a seller or a buyer, or other ancillary services, such as preparing property particulars or photographs or an energy performance certificate, the intermediary will be in the scope of the Estate Agents Act and bound by its obligations. The Estate Agents Act will therefore continue to apply to businesses that are involved in or have scope to influence property transactions.

The Government have found uncertainty and a range of views among stakeholders as to the application of the Estate Agents Act to intermediary businesses, particularly online. This is unhelpful to consumers who might wish to use an intermediary, and unhelpful to businesses, whether intermediaries or more traditional estate agents, or those interested in entering the market. Stakeholders are also concerned that consumers should be protected where they rely on a service provider in relation to a transaction as valuable and important as a house sale or purchase. Clearly, for most people it is the highest value and most important purchase they will make. The Estate Agents Act will continue to apply to businesses providing personal advice about a potential sale or other ancillary services.

For those reasons, this is a limited deregulation. It addresses the perceived uncertainty as to the scope of the Estate Agents Act and it brings benefits to consumers and to the industry, but, crucially, it does not unduly reduce consumer protection in relation to services that involve the service provider in the property transaction.

[Mr Iain Wright]

I thank the Minister for her helpful comments and I have also read her written ministerial statement to the House on this matter from 13 September. As she rightly says, Government new clause 15 updates and extends an exemption to the definition of estate agency work, as set out in the Estate Agents Act 1979. The legislation pre-dated the rise of the internet, and as the Minister rightly said, the world of buying and selling a house has been revolutionised by the internet. Buyers and sellers are now more likely to looking at the likes of Rightmove, Zoopla or PrimeLocation online than to be using a traditional high street estate agent, at least in the early stages of the process.

From the Minister’s comments I understand that some private sales internet portals may be exempt from the Estate Agents Act while others may be within its scope, depending on whether they provide advertising space or allow prospective buyers and sellers to match up via an online messaging board.

The Minister mentioned the Government’s report “Removing Red Tape for Challenger Businesses”. I was struck by a particular comment that is relevant to this part of the Bill. It states:

“Stripped-down business models, offering competitive prices to home buyers and sellers in exchange for limited, online services are caught by current legislation which applies a broad definition to ‘estate agency work’. Once legally categorised in this way, these innovative businesses are tied to regulation which can be disproportionate to the range of services they offer, and which may be inhibiting the growth of this alternative method of house buying and selling.”

The Opposition do not necessarily disagree with the Government’s approach to this, and we would certainly welcome innovation and improved competition to support, first and foremost, the consumer in what is, as the Minister rightly said, probably the biggest and most significant purchase or sale in his or her life, but we do have a number of questions that I hope the Minister will be able to address.

Discussions about amending the Estate Agents Act 1979 go as far back as February 2010, when the Office of Fair Trading reported on its study into home buying and selling. I fully appreciate that the study strongly stated that innovation could have an impact on the cost of buying and selling a home and that the current legislation might be hindering the emergence of new business models, but it also stated that overall satisfaction with estate agents had improved in recent years and that, where there were problems in the process, consumers on the whole did not tend to think that the estate agent was at fault. The OFT found the existing legislation to be both comprehensive and wide-ranging and that further regulation was unnecessary.

I appreciate—I say this before the Minister intervenes—that the amendment is deregulatory in nature, but the OFT report concluded that the focus should be on improving the enforcement of current rules to guard against serious breaches. That being the case, and notwithstanding my earlier, hopefully supportive, comments welcoming the introduction of a greater degree of innovation in the industry, will she go back to first principles and outline the specific benefits that the new clause will produce? What forecast has she made regarding how and in what numbers she anticipates new entrants will come into the market? What estimates has she made regarding cost savings to consumers? Has she been able to quantify the savings to business that such a deregulatory approach would produce?

For a Bill that purports to be all about enterprise, the theme of our deliberations during its passage through the House has been a spectacular lack of evidence to support its provisions, so it would be useful if she could provide some quantifiable and empirical evidence. What consideration has the Minister given to consumer protection in the light of the new clause? Is there a risk that people will not have access to the suitable, robust and—one would hope—impartial advice that could be provided by an estate agent? Has she thought about the potential risks to vulnerable people, particularly the elderly, some of whom might be susceptible to scare tactics and unscrupulous behaviour? What is in place to ensure that those people do not see a reduction in their consumer protection as a result of the new clause?

The Minister might also be aware of concerns raised by the National Association of Estate Agents about a potential breach of the UK’s anti-money laundering regulations as a result of the new clause. Estate agents are covered under the third money laundering directive, which I understand has been implemented in the UK through the Money Laundering Regulations 2007. The Minister referred to those regulations in her written ministerial statement last month, stating that the Terrorism Act 2000 and the Proceeds of Crime Act 2002 incorporate the definition from the Estate Agents Act 1979 in applying particular standards to regulated sectors, which include estate agents. Can she therefore confirm that the new clause will deal with the risk of money laundering? Can she—for my purposes, rather than anybody else’s—clarify that those estate agents who will be taken out of the scope of the 1979 Act because they provide a slimmed down business model will still be seen as a regulated sector for the purposes of money laundering regulations? I hope that she can answer these questions comprehensively, but the Opposition can certainly support one of the things she proposes with regard to injecting a greater degree of innovation into the market and embracing new business models. I look forward to hearing what she has to say.

[Jo Swinson]

I welcome the hon. Gentleman’s general support for the new clause. He is right to point out that the world has changed since the current legislation on estate agents came into force and that the internet has been absolutely revolutionary in that regard. He mentioned a number of popular and well-known property websites. I just caution him not to conclude that those household names would necessarily be caught by this limited deregulation. That is not the intention of the new clause at all. To put it into perspective, there are currently about 14,000 traditional estate agent offices in the UK—virtually all of them also have an internet presence—but there are fewer than 30 private sales portals in the UK, all of which are small and medium-sized enterprises, so that is quite an undeveloped part of our market. As for how many property sales go through estate agents, in 2000 the figure was 87%, with only 11% sold privately. That compares with other markets where it is rather less than that; for example, in the United States about 20% of sales are undertaken privately.

--- Later in debate ---

[Mr Iain Wright]

The Minister will recall that I mentioned concerns about money laundering. Will she say a few words about that?

[Jo Swinson]

The companies covered by this deregulation would not be involved in the transaction of money, because if they were they would remain caught by the Estate Agents Act. We therefore do not need to worry about this in relation to making it easier to undertake money laundering. Of course the Government maintain their provisions to try to make sure that they enforce the existing rules against money laundering in an appropriate fashion.

I hope that in the absence of any other questions from Members we will be able to proceed with a fair degree of consensus on this useful, though limited, deregulatory measure.

Question put and agreed to.

New clause 15 accordingly read a Second time, and added to the Bill.

New Clause 9

Listed buildings in England: agreements and orders granting listed building consent

‘(1) The Planning (Listed Buildings and Conservation Areas) Act 1990 is amended as follows.

(2) In Chapter 2 of Part 1, after section 26 insert—

“Buildings in England: heritage partnership agreements

26A Heritage partnership agreements

‘(1) A relevant local planning authority may make an agreement under this section (a “heritage partnership agreement”) with any owner of a listed building, or a part of such a building, situated in England.

(2) Any of the following may also be a party to a heritage partnership agreement in addition to an owner and the relevant local planning authority—

(a) any other relevant local planning authority;

(b) the Secretary of State;

(c) the Commission;

(d) any person who has an interest in the listed building;

(e) any occupier of the listed building;

(f) any person involved in the management of the listed building;

(g) any other person who appears to the relevant local planning authority appropriate as having special knowledge of, or interest in, the listed building, or in buildings of architectural or historic interest more generally.

(3) A heritage partnership agreement may contain provision—

(a) granting listed building consent under section 8(1) in respect of specified works for the alteration or extension of the listed building to which the agreement relates, and

(b) specifying any conditions to which the consent is subject.

(4) The conditions to which listed building consent may be subject under subsection (3)(b) in respect of specified works are those that could be attached to listed building consent in respect of the works if consent were to be granted under section 16.

(5) If a heritage partnership agreement contains provision under subsection (3), nothing in sections 10 to 26 and 28 applies in relation to listed building consent for the specified works, subject to any regulations under section 26B(2)(f).

(6) A heritage partnership agreement may also—

(a) specify or describe works that would or would not, in the view of the parties to the agreement, affect the character of the listed building as a building of special architectural or historic interest;

(b) make provision about the maintenance and preservation of the listed building;

(c) make provision about the carrying out of specified work, or the doing of any specified thing, in relation to the listed building;

(d) provide for public access to the listed building and the provision to the public of associated facilities, information or services;

(e) restrict access to, or use of, the listed building;

(f) prohibit the doing of any specified thing in relation to the listed building;

(g) provide for a relevant public authority to make payments of specified amounts and on specified terms—

(i) for, or towards, the costs of any works provided for under the agreement; or

(ii) in consideration of any restriction, prohibition or obligation accepted by any other party to the agreement.

(7) For the purposes of subsection (6)(g), each of the following, if a party to the agreement, is a relevant public authority—

(a) the Secretary of State;

(b) the Commission;

(c) a relevant local planning authority.

(8) In this section “specified” means specified or described in the heritage partnership agreement.

(9) In this section and section 26B—

“owner”, in relation to a listed building or a part of such a building, means a person who is for the time being —

(a) the estate owner in respect of the fee simple in the building or part; or

(b) entitled to a tenancy of the building or part granted or extended for a term of years certain of which not less than seven years remain unexpired;

“relevant local planning authority”, in relation to a listed building, means a local planning authority in whose area the building or any part of the building is situated.

26B Heritage partnership agreements: supplemental

‘(1) A heritage partnership agreement—

(a) must be in writing;

(b) must make provision for the parties to review its terms at intervals specified in the agreement;

(c) must make provision for its termination and variation;

(d) may relate to more than one listed building or part, provided that in each case a relevant local planning authority and an owner are parties to the agreement; and

(e) may contain incidental and consequential provisions.

(2) The Secretary of State may by regulations make provision—

(a) about any consultation that must take place before heritage partnership agreements are made or varied;

(b) about the publicity that must be given to heritage partnership agreements before or after they are made or varied;

(c) specifying terms that must be included in heritage partnership agreements;

(d) enabling the Secretary of State or any other person specified in the regulations to terminate by order a heritage partnership agreement or any provision of such an agreement;

(e) about the provision that may be included in an order made under regulations under paragraph (d), including provision enabling such orders to contain supplementary, incidental, transitory, transitional or saving provision;

(f) applying or reproducing, with or without modifications, any provision of sections 10 to 26 and 28 for the purposes of heritage partnership agreements;

(g) modifying any other provision of this Act as it applies in relation to heritage partnership agreements.

(3) Regulations made under subsection (2)(a) may, in particular, include provision as to—

(a) the circumstances in which consultation must take place;

(b) the types of listed building in respect of which consultation must take place;

(c) who must carry out the consultation;

(d) who must be consulted (including provision enabling the Commission to direct who is to be consulted in particular cases); and

(e) how the consultation must be carried out.

(4) Listed building consent granted by a heritage partnership agreement (except so far as the agreement or regulations under subsection (2) otherwise provide) enures for the benefit of the building and of all persons for the time being interested in it.

(5) Subject to subsection (4), a heritage partnership agreement cannot impose any obligation or liability, or confer any right, on a person who is not party to the agreement.

(6) Section 84 of the Law of Property Act 1925 (power to discharge or modify restrictive covenant) does not apply to a heritage partnership agreement.”

(3) After section 26B insert—

“Buildings in England: orders granting listed building consent

26C Listed building consent orders

‘(1) The Secretary of State may by order (a “listed building consent order”) grant listed building consent under section 8(1) in respect of works of any description for the alteration or extension of listed buildings of any description in England.

(2) The consent may be granted subject to conditions specified in the order.

(3) Without prejudice to the generality of subsection (2), the conditions that may be specified include any conditions subject to which listed building consent may be granted under section 16.

(4) A listed building consent order may (without prejudice to section 17(2)) give the local planning authority power to require details of works to be approved by them, and may grant consent subject to conditions with respect to—

(a) the making of an application to the authority for a determination as to whether such approval is required, and

(b) the outcome of such an application or the way it is dealt with.

(5) A listed building consent order may enable the Secretary of State or the local planning authority to direct that consent granted by the order does not apply—

(a) to a listed building specified in the direction;

(b) to listed buildings of a description specified in the direction;

(c) to listed buildings in an area specified in the direction.

(6) An order may in particular make provision about the making, coming into force, variation and revocation of such a direction, including provision conferring powers on the Secretary of State in relation to directions by a local planning authority.

(7) Nothing in sections 10 to 26 applies in relation to listed building consent granted by a listed building consent order; but that does not affect the application of sections 20, 21 and 22 in relation to an application for approval required by a condition to which consent is subject.

26D Local listed building consent orders

‘(1) A local planning authority for any area in England may by order (a “local listed building consent order”) grant listed building consent under section 8(1) in respect of works of any description for the alteration or extension of listed buildings.

(2) Regulations under this Act may provide that subsection (1) does not apply to listed buildings of any description or in any area.

(3) The consent granted by a local listed building consent order may relate—

(a) to all listed buildings in the area of the authority or any part of that area;

(b) to listed buildings of any description in that area or any part of that area.

(4) The consent may be granted subject to conditions specified in the order.

(5) Without prejudice to the generality of subsection (4), the conditions that may be specified include any subject to which listed building consent may be granted under section 16.

(6) A local listed building consent order may enable the local planning authority to direct that the consent granted by the order in respect of works of any description does not apply—

(a) to a listed building specified in the direction;

(b) to listed buildings of a description specified in the direction;

(c) to listed buildings in an area specified in the direction.

(7) An order may in particular make provision about the making, coming into force, variation and revocation of such a direction, including provision conferring powers on the Secretary of State.

(8) Nothing in sections 10 to 26 applies in relation to listed building consent granted by a local listed building consent order; but that does not affect the application of sections 20, 21 and 22 in relation to an application for approval required by a condition to which consent is subject.

(9) Schedule 2A makes provision in connection with local listed building consent orders.

26E Powers of Secretary of State in relation to local orders

‘(1) At any time before a local listed building consent order is adopted by a local planning authority the Secretary of State may direct that the order (or any part of it) is not to be adopted without the Secretary of State’s approval.

(2) If the Secretary of State gives a direction under subsection (1)—

(a) the authority must not take any step in connection with the adoption of the order until they have submitted the order or the part to the Secretary of State and the Secretary of State has decided whether to approve it;

(b) the order has no effect unless it (or the part) has been approved by the Secretary of State.

(3) In considering an order or part submitted under subsection (2)(a) the Secretary of State may take account of any matter the Secretary of State thinks relevant.

(4) It is immaterial whether any such matter was taken account of by the local planning authority.

(5) The Secretary of State—

(a) may approve or reject an order or part of an order submitted under subsection (2)(a);

(b) must give reasons for that decision.

(6) The Secretary of State—

(a) may at any time before a local listed building consent order is adopted by the local planning authority, direct them to modify it in accordance with the direction;

(b) must give reasons for any such direction.

(7) The local planning authority—

(a) must comply with a direction under subsection (6);

(b) must not adopt the order unless the Secretary of State gives notice of being satisfied that they have complied with the direction.

(8) The Secretary of State—

(a) may at any time by order revoke a local listed building consent order if of the opinion that it is expedient to do so;

(b) must give reasons for doing so.

(9) The Secretary of State—

(a) must not make an order under subsection (8) without consulting the local planning authority;

(b) if proposing to make such an order, must serve notice on the local planning authority.

(10) A notice under subsection (9)(b) must specify the period (which must not be less than 28 days from the date of its service) within which the authority may require an opportunity of appearing before and being heard by a person appointed by the Secretary of State for the purpose.

(11) The Secretary of State must give the authority such an opportunity if they require it within the period specified in the notice.

26F Considerations in making orders

‘(1) In considering whether to make a listed building consent order or local listed building consent order the Secretary of State or local planning authority must have special regard to the desirability of preserving—

(a) listed buildings of a description to which the order applies,

(b) their setting, or

(c) any features of special architectural or historic interest which they possess.

(2) Before making a listed building consent order the Secretary of State must consult the Commission.

26G Effect of revision or revocation of order on incomplete works

‘(1) A listed building consent order or local listed building consent order may include provision permitting the completion of works if—

(a) listed building consent is granted by the order in respect of the works, and

(b) the listed building consent is withdrawn after the works are started but before they are completed.

(2) Listed building consent granted by an order is withdrawn—

(a) if the order is revoked;

(b) if the order is varied or (in the case of a local listed building consent order) revised so that it ceases to grant listed building consent in respect of the works or materially changes any condition or limitation to which the grant of listed building consent is subject;

(c) if a direction applying to the listed building is issued under powers conferred under section 26C(5) or 26D(6).”

(4) After section 28 insert—

“28A Compensation where consent formerly granted by order is granted conditionally or refused

(1) Section 28 also has effect (subject to subsections (2) and (3)) where—

(a) listed building consent granted by a listed building consent order or a local listed building consent order is withdrawn (whether by the revocation or amendment of the order or by the issue of a direction), and

(b) on an application for listed building consent made within the prescribed period after the withdrawal, consent for works formerly authorised by the order is refused or is granted subject to conditions other than those imposed by the order.

(2) Section 28 does not have effect by virtue of subsection (1) if—

(a) the works authorised by the order were started before the withdrawal, and

(b) the order included provision in pursuance of section 26G permitting the works to be completed after the withdrawal.

(3) Section 28 does not have effect by virtue of subsection (1) if—

(a) notice of the withdrawal was published in the prescribed manner and within the prescribed period before the withdrawal, and

(b) the works authorised by the order were not started before the notice was published.

(4) Where section 28 has effect by virtue of subsection (1), references in section 28(2) and (3) to the revocation or modification of listed building consent are references to the withdrawal of the listed building consent by revocation or amendment of the order or by issue of the direction.”

(5) Schedule [Local listed building consent orders: procedure] (which inserts Schedule 2A to the Planning (Listed Buildings and Conservation Areas) Act 1990) has effect.’.—(Matthew Hancock.)

Brought up, and read the First time.