Lord Beecham
Main Page: Lord Beecham (Labour - Life peer)Department Debates - View all Lord Beecham's debates with the Leader of the House
(8 years, 7 months ago)
Lords ChamberMy Lords, the amendments in this group relate to the extension of the right to buy to housing association tenants, for the time being under a so-called voluntary scheme entered into by the sector with the Government. On several occasions I have expressed my scepticism about how long the agreement will remain voluntary. I pointed out in Committee that the Bill’s impact assessment states explicitly, in somewhat minatory fashion:
“Primary legislation is also required to monitor how these opportunities are being adopted so potential homeowners can hold their housing association to account, if necessary”.
The nostrum of Theodore Roosevelt comes to mind:
“Speak softly and carry a big stick”—
a view reinforced by the fact that the agreement contains a “presumption” that associations will agree to tenants’ applications to exercise their right. The very word, it might be thought, gives the game away.
So I ask the Minister whether the monitoring process applies not just to sales but to the number, type and location of the replacement housing which is supposed to be built. How often will the monitoring take place and by whom will it be performed? Will it really be possible to replicate as a result of this policy developments such as the famous Bournville village, still flourishing as a distinctive community 125 years since its conception?
In Committee, I went on to point out that the so-called impact assessment did not contain any estimate of the number of homes which might be sold, over what period, how much is expected to be realised and what the cost of discounts would be and how they would be met. Is the Minister able to enlighten us as to these rather critical factors in terms of the operation of the scheme?
There is no requirement to replace any houses sold in the local authority area where they are situated, nor need the replacements be of the same tenure. In some cases that might prove difficult, which serves only to emphasise the way in which the current mix within communities is likely to change, a factor which is the special concern raised in Amendment 52 in the names of the right reverend Prelate the Bishop of St Albans and my noble friend Lady Royall.
The long-term effects are likely to reflect the experience of the forced sale of council housing, where now something like 40% of houses which were sold under right to buy are owned by private landlords, with rents which have soared—increases which, in turn, have been reflected in an increasing cost to the Government through housing benefit.
Even allowing for the unspoken threat of compulsion—which, with a bigger Conservative majority, I suspect, would have already resulted in a compulsory scheme—there is a marked contrast with the cavalier approach towards local housing authorities. They not only have to offer ever-larger discounts to their tenants but also, adding injury to insult, have to pay for the scheme by the sale of high-value homes, the subject of amendments in later groups.
In Committee, the noble Baroness, Lady Williams, in replying to the noble Lord, Lord Young of Cookham, said that the Government were discussing with the sector the issue of the application of the agreement to properties constructed under Section 106 agreements and whether or not they would be included. Perhaps the noble Baroness can update us on that position.
The noble Baroness also responded to an amendment from this Front Bench seeking to exclude properties specifically designed for elderly or disabled residents of the scheme by saying that it would be “wholly unequal”—I think she meant inequitable—to prevent such residents having the opportunity to share in the benefits of home ownership, and that a property which had been adapted specifically for a tenant and selling it,
“and freeing the capital to build a new unit for the next person in need is the best outcome”.—[Official Report, 8/3/16; col. 1228.]
It might be, but there is no requirement to do so. Nor does the purchase have to be by elderly or disabled people.
The term “purpose-built bungalows” in developments such as, I say modestly again, Beecham Close—built in Newcastle in my ward—could easily over time be occupied by people for whom they were not designed. They are perfectly accessible properties specifically designed for elderly people but they could go to anyone after resale, let alone preserve the character of a group specifically designed to bring people with similar needs together.
Amendment 51 seeks to ensure that the full market value of properties sold by associations under right to buy is invested by the association in the same local authority area to provide affordable housing of at least one new replacement home of the same tenure and in accordance with assessed housing need. It therefore prescribes this in addition to any conditions which the Secretary of State considers appropriate under existing Clause 62(2). I beg to move.
My Lords, I am not an expert on housing but in the previous coalition Government I spent three years speaking in this House for charities, and I am concerned about the implications of this aspect of the Bill for charity law. In the past two or three weeks I have spoken to a number of charity lawyers and people concerned with charities and it was suggested that we might wish to table an amendment to exempt charities from this. However, at this stage, I ask the Government for some reassurance that they have considered the potential impact on charities of this development and that they would be willing to meet with and discuss further with representatives of the Almshouse Association, the Charities’ Property Association and the Charity Law Association to think through the implications of the Bill and, incidentally, the plans to make all schools, some of which have charitable property, into academies, which also raises large questions about the future of charity law.
There are questions of public benefit—and private benefit if one is selling off properties—which again raise some large issues and which, potentially, drive a coach and horses through the underlying principles of charity law. As the noble Lord, Lord Beecham, has hinted, this is particularly relevant to almshouses, which are specifically built and permanently endowed for old people. The idea that they should be sold off and then perhaps diverted to different uses raises some fundamental issues.
I am grateful to all noble Lords who have spoken in the debate and to the Minister for her reply. I am particularly grateful to the noble Lord, Lord Shipley, for detecting an error of judgment in the amendment in my name and that of my noble friend Lord Kennedy. He is absolutely right that it would be a mistake to require the replacement homes to be built in the same locality. Were this a matter that the Government were going to take back and consider, I would invite them to take that into account. Clearly, however, they are not going to take it back to be considered.
The noble Lord, Lord Young, rather airily dismissed concerns about the nature of this process on the grounds that it is, after all, voluntary. On paper, it looks as though it is voluntary; however, I return to the issues which I raised. In that event, why is it necessary to create a presumption as to the process, which the Bill does? Why is it necessary to declare that primary legislation is required to monitor how those opportunities are being adopted? The Minister talked about figures being available but this is a legislative provision. If it is simply a question of collating material, it would hardly be necessary to include it in legislation. Nevertheless, it is to be included and there is this worrying presumption that housing associations will agree to tenants’ applications and monitoring will take place to see that those associations are held to account by potential home owners. That is a rather threatening background to what is allegedly an entirely voluntary scheme. I hope that the noble Baroness, Lady Evans, will forgive me but I remain sceptical about the long-term nature of that voluntary claim. I hope to be disproved on that.
I would be tempted to test the opinion of the House, were it not for the fact that the sector has largely accepted the agreement—mistakenly, in my view, but nevertheless it has. In those circumstances, I hope that I am proved wrong but I will not seek to press the amendment and I beg leave to withdraw it.
My Lords, some years ago, I was a member of the Delegated Powers Committee. Determinations are almost always undesirable. They are arrived at and presented as an option of last resort because, as the noble Lord, Lord Lisvane, said, the matter being considered has become very complicated and detailed. Determinations are a sort of escape clause, as I see it. In a parliamentary democracy, they are inherently undesirable, and I therefore support the amendment.
My Lords, the House is indeed fortunate to have such an expert in parliamentary procedure as the noble Lord, Lord Lisvane. I have listened to him and learned a great deal in a very short time; I am sure that other noble Lords will feel the same. It is interesting that the noble Viscount, Lord Eccles, has effectively confirmed that he approves the noble Lord’s approach to dealing with these matters. Otherwise, Parliament in effect will be being asked once again to sign a blank cheque covering matters of considerable importance and complexity which will simply proceed under ministerial fiat. That cannot be healthy, given the nature and importance of the topic we are discussing.
I hope that the Minister, who has today written to some Members of the House about aspects of this matter—I am sure that the document will be in the Library as well, although somewhat belatedly—will acknowledge that the noble Lord has made a very powerful case for adopting a more conventional procedure than that of delegating determinative powers which will be exercised without any oversight at all. Nothing in what the noble Lord suggested would substantially obstruct the carrying out of the Government’s policy; they would just have to explain and seek parliamentary approval in what is, after all, a pretty normal way. I hope that the Government will react positively to the amendment. If, having regard to apparently moving circumstances as reflected in her letter, the noble Baroness is unable to accept the amendment today, if she could undertake to come back on it at Third Reading, that might suffice. Otherwise, I suspect that the noble Lord will be tempted to test the opinion of the House. In that event, the Opposition will certainly support him.
My Lords, I, too, have served on the Delegated Powers and Regulatory Reform Committee for at least two sessions of three years each. What concerns me is the word “regulations”. Does it mean that this will be another regulation that will come to us in a pre-formed state and we will not have any opportunity to consider its implications? I find it very worrying that we are doing more and more by secondary legislation and less by primary legislation, and I should like the Minister to cover that point in her reply.
I will give way to the noble Lord but I want to tell him a personal fact. When I was the Secretary of State responsible and worked out the lowest number of houses we needed, what did the Labour Party do? It denied that that was the number needed. Indeed, when the noble Lord, Lord Prescott, came in, he reorganised the figures to cover up the fact that I was right; we did need those houses. I do not think that the Labour Party, the Conservative Party or indeed the Liberal Democrats had anything to trumpet about in the past. We now have a Government who are actually trying to do something about it.
I do not for a moment disagree that insufficient numbers of houses were built, in particular council houses, under the Labour Government, but the massive investment in the condition of the housing stock under that Government should not be forgotten.
My Lords, I thank the noble Lords, Lord Kerslake and Lord Kennedy of Southwark, and the noble Baroness, Lady Bakewell, who have all made powerful arguments about the importance of delivering new homes and meeting the needs of local communities, which is so important.
I agree with the noble Lord, Lord Kerslake, that when government makes agreements with local authorities outside London about building new homes, we should ensure that at least one new affordable home is provided for each old dwelling that is sold. That has always been our intention, but today I am very happy to work to make that intention clear in the Bill. As I said earlier, I would like to consider further how we can best reflect that in the Bill, and I look forward to working with the noble Lord and others on it. The noble Lord makes powerful arguments about the different needs of different areas. Many noble Lords in the House—certainly many of those in the Chamber today—have, at some point or other, represented very different areas with very different needs. Reflecting this diversity and respecting the views of local people and local leaders is at the heart of the Government’s drive for localism, as several noble Lords have pointed out. I totally agree that in our dialogue with local communities, local authorities should be empowered to make the case for the right balance of housing in their area, and that there should be a strong expectation that the Government will listen. That is absolutely our intention; indeed, it reflects our broader approach.
The Bill enables dialogue through the provisions of Clause 72, which enables agreements to be made about the delivery of replacement homes. As I said, I am very happy to work with the noble Lord, Lord Kerslake, to give local authorities with particular housing needs in their areas the opportunity to reach bespoke agreements with the Government about the delivery of different types of new homes in their areas.
With those assurances, I hope that the noble Lords, Lord Kerslake and Lord Kennedy, will agree not to press their amendments. I hope that this commitment will also enable the noble Baroness, Lady Bakewell, not to press her amendment, as we bring forward a proposal that ensures the delivery of housing in a way that specifies the cost of replacement, as a deduction to payments would not.
Before the Minister sits down, just to clarify, the amendment with which she indicates sympathy and which she will come back to, which is very welcome, is based on the premise that a property will have been sold and the money handed over. However, the Bill provides for payment in advance of the sale of any property, so the Government might have received money but no property has been sold. Will the Minister come back on Third Reading with a position on that? Otherwise, presumably, the money could simply stay in Whitehall; there would be no property to be replaced because no property may have been sold, yet money will have been paid over.
My Lords, perhaps I may remind your Lordships that we are on Report and interventions of that length are normally granted by leave of the House. I am sure that the House would have granted the leave, but that is normal practice.
In the spirit of the discussion that we are having, I am very happy to seek clarification on the issue raised by the noble Lord. In fact, we will be working through many issues for Third Reading. I am sure that noble Lords will tell me if I have got it wrong—I am sure that the noble Lord, Lord Kerslake, will.
My Lords, my name is attached to both Amendment 62, in the name of the noble Lord, Lord Cameron of Dillington, which is concerned with the sale of vacant council houses in rural areas and Amendment 63 in the name of the noble Lord, Lord Kennedy of Southwark, which is concerned with the sale of vacant council houses where a tenant transfers from one social housing tenancy to another.
The amendments do not wipe out the Government’s intention that more expensive council homes be sold when they become vacant to pay, principally, for discounts to housing association tenants given the right to buy. Although a large number of us in this Chamber remain unhappy about that approach, the amendments are simply about moderating the effects of this policy.
First, in respect of rural areas, it seems that the Government recognise that the remaining, much-depleted stock of council houses in villages deserves special attention in those many localities where it will simply not be possible to replace properties that are sold. Sales of council housing under the right to buy have been roughly twice as high, proportionately, in rural settings than in urban areas. The trouble is that these rural properties in due course are sold on to commuters and retirees, for second homes and holiday cottages. So although it is harder for local people to buy a home in their village than it is for their urban counterparts, because prices are higher and earnings are lower, the amount of affordable housing for rent from councils or housing associations is roughly half the level in rural communities than the national average. It is really important, therefore, to hang on to the precious resource of the remaining council housing in rural areas. Instead of selling the council house that becomes vacant, it is really important that it can be let to a household with a local claim.
I was very pleased that Ministers agreed, on the first day of this Bill’s Report stage, to exclude rural exception sites—land for developments specifically to help local people—from the requirement to build starter homes, which would so often be much too expensive for local families. I am equally delighted that Ministers are agreeable in principle to enabling councils to hold on to their remaining housing stock in rural areas when this is clearly essential to meet local needs. Of course, we need to study the small print of the Government’s approach to achieving this outcome, but we know—or we believe at any rate, as the noble Lord, Lord Cameron, noted—that housing in national parks and areas of outstanding natural beauty is to be automatically excluded from the pressures to sell council houses, and the Secretary of State will be willing to exclude homes in any rural community when the council can make a case that sold homes cannot be replaced. Accepting these reassurances, I appreciate, involves trusting the Department for Communities and Local Government to use its discretion wisely to act in accordance with this promise. But I guess that we have gone as far as we can reasonably expect in protecting much-needed council housing in our rural communities.
Secondly, on Amendment 63, I think the Minister will be able to put our minds to rest in respect of the requirements on councils to sell vacant homes where tenants are transferring within the stock of council and housing association properties. The problem that we identified earlier was that there are very good reasons to encourage existing tenants to transfer from their current home to another property—for example, for an elderly person to downsize from a family house to a bungalow or sheltered housing flat, making way for a young family; or for a widow to downsize to escape having to pay the dreadful bedroom tax, because she is deemed to have a spare room at present; or for a family to move out of overcrowded premises to somewhere bigger. But since these moves could be said to create a vacancy, it could trigger the requirement to sell a higher-value home to raise funds principally, of course, for the discounts to housing association tenants. What is needed is for vacancies created by transfers to be excluded from the pressures on councils to sell their higher-value vacant homes.
The Minister explained to us in Committee that mutual exchanges will not fall within the scope of the policy. Even though theoretically two vacancies are created when two households swap homes, in reality there are no properties becoming vacant, so this is entirely right. I pressed the Minister, however, also to exclude vacancies created by someone transferring to another home in the social rented sector. I said that I thought that the Minister had indicated that transfers would probably be treated in the same way as exchanges and she responded:
“I think that the noble Lord is right”.—[Official Report, 10/3/16; col. 1518.]
We just need confirmation that this is indeed so or we would have the unfortunate, unintended consequence of greatly inhibiting opportunities for tenants to transfer to more suitable accommodation in future.
I endorse the noble Lord’s last plea, and I think that it is one that the Minister will feel able to agree—or I hope that she will, because it would certainly make a great deal of sense. I very much welcome the Government’s more flexible approach to these matters, and congratulate the noble Lord, Lord Cameron, who is doing rather better than his namesake in many respects at the moment, on achieving two substantial concessions from the Government. They are not perfect, perhaps, but go a long way towards meeting the particular requirements of communities that are in many ways very hard-pressed and would undoubtedly have suffered significant difficulties if the Government had stuck to their original proposals. In that spirit of collaboration, I look forward to the Minister dotting the last “i” and crossing the last “t” in relation to the transfer from one property to another not requiring a sale.
My Lords, I support the amendment in the names of the noble Lords, Lord Cameron of Dillington, Lord Best and Lord Beecham, to which I have added my name. We debated rural housing at length in Committee and I remain concerned that we will see a radical change in housing in rural areas as a result of the implementation of this Bill, if it remains unamended. I welcome the comments from the noble Lord, Lord Cameron, with which I completely agree, as well as those of the noble Lords, Lord Best and Lord Beecham.
I have seen and read the Minister’s letter—not the one that came today—on this subject, and I am afraid that I do not believe that tenants in rural areas will be disadvantaged in the way that she indicates, or be treated differently from other tenants in more urban areas. I regret to say that it often appears that the Government do not always understand the countryside and rural areas. I have found from personal experience, when working in the Palace of Westminster in the past, that it was often extremely difficult to get people to understand the impact of their policies on residents in Greater London, outside Westminster, and completely hopeless to get any understanding of the impact on those further afield. That is especially true if one lived in an area that was considered as somewhere where one went for a holiday and did not actually live your life there. I therefore fully support the amendment and welcome the assurances from the Minister so far on safeguards and exclusions from rural communities, and I wait to hear what she has to say.
My Lords, this amendment would provide that revenue from high-value sales should be retained by the local housing authority rather than be transmitted, as required by the Bill, to the Secretary of State, and should be used to provide replacement affordable housing for rent in the same local authority area.
I shall begin by referring to the position in my local authority, Newcastle, which will be pretty much echoed up and down the country. Shelter conducted an estimate of the number of high-value council properties. Of course, we do not quite know what the definition of “high value” will be, particularly in the light of today’s government amendment but, as a working position, it estimated that Newcastle’s housing stock, which is something in the low 20,000s, would contain about 1,650 high-value properties. On that basis, and on the Government’s approach, it would look as though 82 properties a year might become vacant. I do not know quite what high value in Newcastle would come to, but if it were something over £100,000, at the least we would be looking at something like £10 million a year for several years being paid over to the Government. It might be higher than that, but I do not think it would be much lower. That would be replicated across the country, so the question arises of how this scheme would work and what its impact would be.
I turn for some guidance on that to the impact assessment—so called—which deals with Clauses 67 to 77 on this issue. It defines the problem under consideration as something that will require the Government to “determine high value”, about which we have heard something today,
“and a formula which will be used to calculate the payment each stock owning local authority is required to pay”.
There is a footnote at the bottom of the page in very small print, which states:
“We are engaging with local authorities and are currently in the process of updating data that will be used to help inform the high value threshold, which will determine how much individual councils will need to pay”.
That document was issued in January, and we are now in April. I wonder whether the Minister could give us any indication of how much progress has been made in updating that data and whether and how soon the Government will be able to indicate even a sample of what “high value” would be and how many houses might be affected.
The rationale for intervention is given in the mantra:
“Councils should effectively and efficiently use their resources … it makes sense to sell high value vacant houses to release the value locked up in them”.
The document point outs that:
“165 local authorities own a total of around 1.6 million council homes”.
Then the impact of the intervention is described:
“The main impact will be on stock holding local authorities as they will be required to make a payment to the Secretary of State based on the value of the high value vacant homes they own. By managing their stock more efficiently, and selling vacant housing”,
they can release the value. Of course, it is not just when the property is sold that councils will be required to make a payment; they will be required to do so in advance of any sale, which one might have thought was a somewhat peculiar process.
There is a summary of benefits and costs, and it is a pretty minimal description. The document says:
“Local authorities are not benefitting from their high value vacant assets”.
They have already said that in the report. It goes on:
“This policy will release the value of such assets to use in providing more housing”,
but without any indication of how much would be released, how much new housing would be provided and what kind of housing that would be. It goes on to say:
“The process also provides some flexibility for local authorities to decide which vacant properties they sell … Data will be used to inform the setting of the high value threshold”—
we await indications of what those data will be—
“and the assumptions underlying the calculations in the determination … The policy requires the sale of high value assets which may have some impact on the total stock that a local authority holds”.
By definition, that is going to be the case. This is hardly a detailed analysis of the impact of the Bill. Then it says:
“Local authorities are likely to incur some costs associated with the sale of vacant property”.
Again, that is a pretty massive understatement with no figures attached to it. It continues:
“Consideration will be given to the deductions that should be made from the payment”.
How very kind, but there is no indication of what consideration the Government are likely to give or at least what its outcome is likely to be. It then says, and remember that this is an impact assessment:
“A portion of the receipts will be used to provide more housing, reflecting housing need”.
There is no indication of what portion, or indeed any definition of “housing need”.
Then the impact assessment makes the one specific reference, which of course is timely in view of the impending election of a London mayor, that in London the provision must require that,
“at least two new affordable homes are provided for each vacant high value home that is expected to be sold in the relevant year”.
It may be purely coincidence that London has been chosen for this definition, but a cynic might point out that it is the only firm commitment revealed in the whole impact assessment.
So it is pretty deplorable after all this time, unless the Minister has some information that she can convey to us either today or before Third Reading, that we do not know what the impact is going to be, how much money or how many homes are involved, how many councils will be affected and what a “high value” is. It is a case of Parliament, and in particular your Lordships’ House, being asked to sign a blank cheque to the Government and, frankly, one written in invisible ink. It is highly unsatisfactory, and unless the Minister can produce some assurances about when we are going to get information, we will be left enacting legislation without any clear idea of what will be involved in terms of costs or, crucially, the numbers of replacement houses and where they might be built. In my submission, that is not a satisfactory outcome of a process that we have been engaged in for some months now in both Houses. I beg to move.
My Lords, I thank the noble Lord for his amendment, although I am not sure that I should. I appreciate the considered thoughts from your Lordships’ House on ways in which we can improve the Bill but I fear that the amendment would compromise the ability of the Government to meet our manifesto commitment, which clearly states that receipts from the sale of local authority housing will be used to fund right-to-buy discounts for housing association tenants, as well as supporting the delivery of additional homes. The amendment would prevent us from meeting this clear manifesto commitment, and as a result housing association tenants would be unable to realise their dream of owning their own home.
We know that there is £200 billion of value locked up in housing in this country. We also know that some of that could be used to increase housing supply, something that noble Lords from across the House have expressed a wish to do. We also know that in many places the value has not been used for that purpose. That is why this Government are bringing forward this legislation. I make it clear that we also want to increase housing supply with these receipts and through the voluntary deal with housing associations that will see more homes built for each right-to-buy sale.
My Lords, I shall reluctantly withdraw the amendment. I do not blame the Minister for the situation that we are in, but we are enacting legislation the outcome of which is utterly unclear, in terms of both the physical reality of houses that are to be sold and replaced and the costs. It really is not good enough that we should be placed in this position. I would be tempted to press the matter to a vote were it not for the fact that, as the Minister has pointed out, there is an arrangement, although I am not at all happy with it, under which the housing association right to buy is to be partly funded. As we have not voted against that, it would be illogical to press this decision to a vote.
Still, I hope that the Minister will be able as soon as possible to come up with some facts, figures and details about how the provision here is going to work in practice. It should be possible for the Government to give such an indication, not for every council but certainly for a few. They could take a London borough, a district council or a metropolitan council, for example, just so that we could see what is likely to be achieved. Whether it is possible to do that before Third Reading is, I guess, somewhat problematic, but that is a criticism of the process as a whole and certainly not a criticism of the Minister. Having said all that, I beg leave to withdraw the amendment.
My Lords, these amendments are quite limited. They relate to the way in which the interpretation of the question of vacancy is determined. They seek to require the Secretary of State to specify what that interpretation should be by regulation rather than simply having the option of so doing. Amendment 71A would translate “may” into “must” in Clause 77, such that the Secretary of State must specify by regulations the circumstances in which housing is to be treated as not becoming vacant for the purpose of a high-value sales policy, while Amendment 71B would require those regulations to be affirmative. It is a fairly straightforward matter but it is important that the procedure should follow the route of secondary legislation rather than, as we heard earlier in another context, a matter simply for ministerial determination. I beg to move.
My Lords, I thank the noble Lord for his amendment. It would replace the discretionary power of the Secretary of State to make regulations on specifying circumstances in which housing is not treated as being vacant for the purposes of this part of the Bill by replacing “may” with “must”. The amendments in this group would also require these regulations to be made as affirmative.
As many noble Lords will recall, and as many have made reference to, the DPRRC considered the powers that we proposed to take through this Bill. I am happy to report that it did not seek to change the proposal for this power to be made through a negative resolution. It accepted our arguments that it is appropriate to use the negative procedure for these regulations, as this approach will provide flexibility to ensure that if circumstances change over time or if a need for further exclusions is identified in the future, this can be easily addressed by adding, amending or removing exclusions.
Given my earlier concession on making the regulations setting out the definition of “higher value” through affirmative resolution, and given that the DPRRC agreed with our proposal, I urge the noble Lord to withdraw his amendment.
My Lords, I have received an invitation from the Minister which I regret to say I cannot accept; I wish to test the opinion of the House.