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5 Mar 2003 : Column 852—continued
Mr. Hammond: I am grateful to the hon. Gentleman, who is absolutely right. I have not seen that statement, and I query why it should be necessary for Ministers to table, only this morning, written ministerial statements that are obviously relevant to today's debate. When that sort of thing happens, hon. Members do not have the opportunity to examine them and discuss them with local authorities. I know from copied correspondence that I have seen that many local authorities have already invested substantial amounts of money and time in projects that will certainly not clear the hurdle that the hon. Gentleman has just informed us has been set in the written ministerial statement. That is a very serious matter. Not only its substance but the way in which it has been handled do no credit at all to the Office of the Deputy Prime Minister. The Minister for Local Government and the Regions is not, of course, directly responsible for such matters; I am sure that he would have handled them in a way that was not so grossly discourteous to local authorities. He will know that this debacle has done a great deal of damage to the relationship between his Department and local authorities.
Mr. Michael Jack (Fylde): Does my hon. Friend feel that, because of the state of the public finances, the actions that have been taken smack of late intervention by the Treasury? Virtually no analysis has been done of the effect of these proposals on councils, which can only move at a certain pace with future housing developments. The whole approach destroys any idea of legitimate expectations.
Mr. Hammond: My right hon. Friend is right. As he points out, local authorities have been placed in an impossible position. They have been planning, spending, making progress with projects and preparing
their budgets, only to find that many of their activities have been put under a shadow on very short notice and without any official notification.The signals from Government are utterly confusing. At the beginning of February, we heard the Deputy Prime Minister batting on about the need to build more affordable housing. In some areas, the need to build more affordable housing and to develop sustainable communities is desperate. At the same time, local authorities—which believed that they had been doing precisely the bidding of the Government in negotiating with their registered social landlords and in working up schemes to provide precisely such affordable and sustainable housing developments—have found that the rug has been pulled from under them without even the courtesy of a phone call. They have been left to pick up the pieces and, in many cases, the costs that they have already incurred.
The Government have given us a curious idea of what freedom and flexibility mean. They seem to mean that the Government take one's assets, cut off one's entitlement to grant funding for one's social housing programme, and replace that funding with grants that are at the discretion of the Secretary of State. At worst, that is open to any kind of gerrymandering; at best, it represents a huge increase in bureaucracy and a loss of local autonomy and accountability, as local authorities are forced to supplicate at the altar of the Deputy Prime Minister for funding for regeneration and social housing schemes.
Clause 11 hands the Government an £800 million pork barrel that is financed by council tenants and council tax payers. That may be why the hon. Member for Dagenham (Jon Cruddas), who I am pleased to see is here, was able to vote with the Government in favour of clause 11, even though his own local authority—Barking and Dagenham—will be the single biggest loser, losing £12 million of capital receipts. Perhaps he has been given an assurance that the Secretary of State's largesse will extend to Barking and Dagenham, and his council will not be out of pocket. So much for the Secretary of State's open-minded and objective approach to funding decisions.
Mr. Andrew Turner: Does my hon. Friend agree that the Minister's body language may tell us more than his words? [Interruption.] He is now trying to appear open and wise. When my hon. Friend makes a point with which the Minister disagrees, he smiles like a crocodile and shakes his head vigorously. However, when my hon. Friend makes a point with which the Minister cannot in honesty disagree, such as the remark about the promises to the hon. Member for Dagenham (Jon Cruddas) or about the Treasury's intervention in the social housing grant, the Minister hunches up, buries his nose in his papers and scribbles notes.
Mr. Hammond: I do not have the expertise that my hon. Friend obviously possesses in the analysis of Ministers' body language. This particular Minister's body language is usually smiling, and I find it difficult to read anything into that, although I have discovered that smiling does not necessarily indicate agreement with or
approval of what is being said. I look forward to my hon. Friend's continued interpretation, as I may find it helpful.New clause 3 is a further attempt at compromise, following the attempts that we made in Committee and that were rejected by the Government. I am delighted that the Liberal Democrats have decided to support the new clause. It proposes that the Secretary of State should pay a mandatory special grant for social housing provision and repairs to housing stock, equivalent to 50 per cent. of what is received under the provisions of clause 11. Effectively, new clause 3 provides that 25 per cent. of right-to-buy receipts would remain in the hands of the local authority, with no restrictions on its use; 37.5 per cent. would come back to the authority in a ring-fenced special grant to be spent on social housing and repairs to stock; and 37.5 per cent. would go to the Secretary of State for redistribution, if he is generous, or to be swallowed up into the Chancellor's black hole, if he is ungenerous. More than half the receipts would remain with or return to the local authority. That is a compromise position that any reasonable Government would accept. Unless the Minister will accept it, all we have on offer from him is a set of transitional arrangements that reject the arguments in principle against this centralising measure.
During the debate in Committee, we touched on the question of receipts other than in the form of cash—in particular, in the form of nomination rights. For example, a local authority might transfer assets to a registered social landlord in exchange for nomination rights to the tenancies in those assets. The Opposition amendment in Committee proposed that such receipts should be excluded from the sequestration process.
The Bill would require local authorities to value such nomination rights and pay a levy to the Secretary of State, in cash, on receipts that have not been received in cash. That would present serious problems for local authorities. To the Minister's credit, he recognised that that was not the Government's intention, but he did not accept the amendment because he noticed many loopholes and possibilities for evasion by local authorities of his taxing plans. He said:
- "I cannot give the hon. Gentleman an absolute guarantee that we will be able to produce revised regulations in time for Report stage, but that is only because of the considerable number of other pressures under which we are working."
- "I undertake to write to the hon. Gentleman, setting out our thoughts on how we might address this conundrum and I will copy that letter to all Committee members."—[Official Report, Standing Committee A, 28 January 2003; c. 145.]
We needed to see how the Government intended to deal with the issue before we returned to the subject on Report. In the absence of any revised draft regulations, we needed at least to have the Minister's thoughts set
out for us. If he has not been able to set them out in writing, perhaps he will take a little extra time and trouble to set them out in detail when he replies to the debate.The second issue that I wish to raise with the Minister is the situation relating to new towns. Currently, the sale of stock transferred originally from the Commission for the New Towns or English Partnerships to new town local authorities is subject to a clawback, equivalent to 75 per cent., to English Partnerships. The Minister will know that there was a debate last week in Westminster Hall to which his colleague, the Under-Secretary of State, Office of the Deputy Prime Minister, the hon. Member for Harrow, East (Mr. McNulty), responded. In that debate, I raised the following question. The Government's response to the Select Committee's report on new towns, their problems and future, states:
- "English Partnerships will discuss with the individual local authorities the issue of assets and liabilities, including clawback. In some circumstances, and with the agreement of the Treasury, English Partnerships might waive clawback or transfer the right to receive clawback to the respective local authority."
Will the clawback waiver by EP actually operate and, if so, will the receipt that the local authority obtains be subject to the clause 11 sequestration process? If so, English Partnerships will give, only for the Secretary of State to take away. That would be a meaningless exercise. If what the Government said in their response to the Select Committee's report stands, and the new towns are exempt from the process by the waiver of clawback in specified cases, it represents a large and partisan hole in the Bill. After all, all but one of the new town authorities are controlled by the Labour party. I would be concerned if the Government were introducing a different regime for the new towns compared with all other authorities, effectively exempting some Labour-controlled authorities from the pain that they are inflicting on all other authorities. I look forward to the Minister's response on that issue.
New clause 6 is an attempt to probe the Government on the recently announced power of forced letting. It seeks to prevent information from council tax records being used as a base for a programme of forced lettings of empty property. I have two questions for the Minister. Will there be an appeal mechanism for anybody whose property is subjected to the proposed enforced letting process? Will a person who does not wish to become a landlord have the right to require the local authority to compulsorily purchase a property identified for compulsory letting?
The Government's proposals on compulsory letting represent a massive infringement of the rights of private property. The Government and Labour Members are very keen on the human rights agenda, but they cannot pick and choose from it. One of the rights guaranteed by
the European convention is the right to private property. Will the Minister confirm that the Government have received specific advice that the compulsory letting of private property with no option to require its compulsory purchase would not breach rights under the convention?
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