Homes Bill

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Mr. Clifton-Brown: There is a problem in the Land Registry. Under voluntary registration arrangements, owners of properties that are not currently registered have the option to apply for registry; compulsory registrations are those that must take place when a property is sold. They are being put on hold because the Land Registry cannot cope with the amount of work. I understand that the Bill will not come into operation for two years, but if a substantial number of properties have still not been registered under the new system at the Land Registry, that could make it much more difficult to provide local authority searches on time to put properties on the market where they are not registered. Will the Minister address that problem or at least give the Committee an idea of when he expects all houses in England to be registered?

11.30 am

Mr. Raynsford: The hon. Gentleman has made a fair and good point and I undertake to look into the matter and write to him. It is certainly our wish that the Land Registry should be operating as efficiently and smoothly as possible as soon as possible to provide the swift and seamless service that we want to be available for quick clarification of the information required for searches. On that basis, I hope that the hon. Member for Eastbourne will agree to withdraw the amendment.

Mr. Waterson: I am happy to beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Waterson: I beg to move amendment No. 36, in page 6, line 24, at end add—

`( ) Before making regulations for the purposes described in subsection (1) the Secretary of State shall consult with representatives of those bodies likely to have an interest in or be affected by the proposals.'.

I am afraid that the amendment will require a more substantial debate than we have had on others, Mr. Gale, but I do not see myself seeking to catch your eye for any stand part debate on clause 7. I hope that that is helpful.

On the face of it, the amendment may seem rather innocuous, but it raises serious and worrying issues. It makes the eminently reasonable point that, before making any regulations under subsection (1),

the Secretary of State shall consult with representatives of those bodies likely to have an interest in or be affected by the proposals.

We hope that the Secretary of State would be willing to do that in any event. We are entering uncharted waters with the legislation, so it is important that, when considering any regulations to be published in due course, the Secretary of State has access to the best possible advice from those in the property-selling field and that those regulations have their full confidence. Many concerns have been expressed to my hon. Friends and me about aspects of the Bill and we are doing our best to raise them as we go along. Even if the Minister is not willing to accept our amendments, I hope that his advisers will take on board at least some of the comments when considering the draft regulations.

We have received quite a lot of advice from certain organisations—I am not saying that others are not properly involved. The Law Society, the Council of Mortgage Lenders, the National Association of Estate Agents and the Independent Association of Estate Agents are only major examples of groups that have made representations. I think that we have all seen releases and briefings from the CML in particular.

It is important that three groups of professionals are fully signed up to the proposals. One group is the Law Society, whose comments and reservations I have quoted on several occasions, including Second Reading; I do not see the need to do so again. The society is deeply concerned about some aspects of the Bill and has made a number of criticisms of the Bristol pilot scheme as relied on by the Government as a basis—we would say an unsound one—for the legislation.

Another group is, of course, estate agents. It is fair to say that the NAEA is broadly in favour of many of the Government's proposals, but it has concerns and they have been expressed in our debates. Indeed, a number of estate agents have concerns. I remember addressing a year or so ago the annual meeting of the Team group of estate agents, which has serious reservations and is very concerned about the effect of the Bill on their profession. With estate agents, I shall group surveyors, who of course also have a view on the legislation. The Royal Institution of Chartered Surveyors in particular has been helpful in proposing amendments and making comments.

The third big group that must sign up to the legislation if it is to stand any chance of success is the mortgage lenders and particularly the CML, which represents more than 98 per cent. of the mortgage-lending sector. Its press release of November 2000 was scathing, saying that:

the evidence in support of introducing Sellers Information Packs (SIPs) is not robust and such packs could lead to increased costs for consumers. The CML does not believe that the pilot of...SIPs has proven the case for change, and that the Government should not commit to new legislation to make SIPs compulsory at this stage.

It went on to express concern about the size of the Bristol pilot and to talk about

a significant fall in the number of property transactions as sellers will be put off `testing' the market.

That is a concern expressed by others who have been in touch with us. The press release quotes the CML director general, Mr. Michael Coogan, as saying

the evidence in support of introducing Sellers Information Packs is not robust and such packs could prove to be unpopular with consumers. The Bristol pilot has failed to demonstrate that SIPs significantly improve the process and that there is widespread support from the professionals in the process.

That constitutes a far from clear expression of support by the CML for the proposals.

All members of the Committee have probably recently received the CML briefing paper setting out its concerns, for example, about the need for lenders to be able to rely on the home condition report and asking whether they have comments on the certification process—a matter to which I may return on another occasion. It is interesting that as recently as December, when the Minister attended its annual conference, members of the CML expressed major worries and opposition to the legislation. Originally, the CML strongly and publicly opposed the Government's proposals to use criminal sanctions to impose the so-called seller's packs on house sellers. As I have said, it also expressed concerns about the Bristol pilot.

Through the good offices of Money Marketing, I have obtained a copy of an internal CML document in which director general Michael Coogan reports, referring to the meeting on 23 November 2000, that

the Executive Committee gave a firm steer that the CML should issue a critical press release on 24 November—

probably the one from which I quoted—

highlighting lenders' concerns about the introduction of SIPs and the (lack of) robustness of the findings from the Bristol Pilot... CML's position was widely covered in the press and CML's views were further emphasised in a second press release issued on 4 December (after the Minister spoke to the Annual Conference that day...)

However, he goes on to say that:

Feedback from the DETR has confirmed that both the Minister and officials are very unhappy at the CML's view that the Bristol Pilot did not present a compelling case for the introduction of SIPs.

I see the Minister nodding. The internal document continues:

Even if there is an early General Election, the current expectation is that the Bill's progress will be completed by April/May. It will, in our estimation, be very difficult to create sufficient support to oppose the Bill successfully in Parliament—

the CML is aware of the efforts of the official Opposition to expose what we regard as the major shortcomings of the legislation—

and strong opposition continuing along the lines of recent releases could damage the CML's working relationship with officials on a number of fronts... However, as expected, the DETR is pressing lenders not to charge for the valuation service in the future (an aspect I responded to negatively in my speech at the Conference last week).

As an appetiser for what comes next, Mr. Coogan says that

The CML will be represented on the HCR working group.

In the light of what he then says, we might regard that as an attempt to buy off the opposition of that important organisation, for the document continues:

However, the Minister will not change direction. It is highly likely that any action taken to prevent the Bill being passed would be fruitless, and only serve to hinder productive work aimed at securing the best possible operating environment for lenders. Now that a legislative slot has been confirmed, some lenders have already indicated that they are stepping-up their work on exploring how they can gain advantage from the proposals.

That is a clear invitation to the CML to haul up the white flag in the face of pressure from Ministers and officials. Mr. Coogan concludes:

Executive Committee members are therefore asked to confirm that they support the CML now working closely with Government officials, behind the scenes, in shaping the framework of both the HCR and the certification process to ensure that the most favourable operating environment for lenders is secured. In particular—

this is the punch line—

in light of recent developments, the Committee's views are sought on the CML taking a less high profile and critical approach to the SIP proposal as the Bill progresses through Parliament.

The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Chris Mullin): Very sensible.

Mr. Waterson: The Minister—the one with the third-class law degree—says that that is very sensible, but I do not agree, nor do I think that it is very democratic. It is obvious what has been going on: the CML, which represents more than 98 per cent. of the mortgage-lending sector, has been got at by Ministers or their officials. It has been persuaded that it is not in its commercial interests to continue a high-profile campaign against the legislation. All the talk about working ``behind the scenes'' and adopting a ``less high profile and critical approach'' to the SIP proposal, reflects the CML's recognition of the fact that Ministers are determined to bash on regardless of any opposition. They intend to take no prisoners and certainly do not intend to do any favours for the CML and its members if they have the temerity to continue publicly to oppose the legislation.

Mr Gale, you do not need me to tell you that it is a vital part of our democratic process that interested bodies such as the CML—few bodies have a more legitimate interest in the Bill—can comment on and criticise legislation during its passage through Parliament. Many Committee debates are informed by that sort of comment and criticism. Hard-pressed Opposition members, who do not have access to the lavish back-up enjoyed by Ministers, are often grateful for the briefings, proposed amendments and meetings with bodies such as the CML that are often made available during Committee stage. Therefore, it is all the more disappointing that the CML has chosen to haul up the white flag.

 

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Prepared 23 January 2001