House of Commons - Regulatory Reform

Select Committee on Regulatory Reform Eighth Report

Findings of our previous report

5. We were satisfied that the proposal for the order met the criteria against which we are required to judge it. We concluded that the proposal should be amended before a draft order were laid before the House, as we were not satisfied with the drafting of the provisions relating to the replacement of the phrase "as agent" in the 1985 Act. We considered that these provisions, namely the proposed new subsections 13 and 14, were not drafted in a readily comprehensible fashion. We also noted the inadequacy of the explanatory statement provided by the Department. We discuss the Department's response to our report below.

6. We found that the proposal, of itself, was not inappropriate for delegated legislation, as it would allow local authorities more flexibility in the way in which they delegated their housing management responsibilities. Nevertheless, we noted that the proposal was closely connected with the introduction of private finance initiative (PFI) projects in local authority housing, a subject which is politically controversial and which might merit wider debate in the House. We examine this matter at greater length below.

The Department's response to the report

Replacement of phrase "as agent"

7. In response to our recommendation, the Department has redrafted the provisions relating to the replacement of the phrase "as agent", with the aim of making them more readily comprehensible. The elements of these provisions, which determine where responsibility lies in respect of the delegation of housing management functions, have been restructured and are now set out in clause 2 of the draft order as new subsections 13, 14 and 15 to the proposed new section 27. The Department's explanatory statement sets out a detailed explanation of the effect of the proposed new subsections.[4] We consider that the relevant provisions have been amended in a manner which satisfies our concerns.

8. The Department has acknowledged that the explanatory statement which it provided with the proposal for the order was inadequate. In particular, the Department accepts that its interpretation of the provisions of the Regulatory Reform Act 2001 relating to the re-enactment of burdens was wrong.[5] It also accepts that the explanatory statement could have been clearer in some other aspects. We take this opportunity to remind Departments that, in preparing the explanatory statements required under section 6 of the Regulatory Reform Act, they must ensure that their analysis clearly explains the effect of the proposed order, by specific reference to each of the requirements laid down in section 6(2) of the Act.

9. On the basis of the explanatory statement, we are satisfied that the responsible Minister has had due regard to our previous report on the proposal for the draft order.

Other representations

10. The Department has amended subsections 8(b) and 10, as inserted by clause 2 of the draft order, in response to a concern raised by the House of Lords Committee on Delegated Powers and Regulatory Reform.[6]

11. Luton Borough Council made a representation to the Department during the period for parliamentary consideration. The Department has indicated that this representation related to issues involved in housing stock transfer to a registered social landlord.[7] The Council requested that consideration be given to the introduction of a statutory requirement to provide equal funding for the promotion of, and the opposition to, proposals for housing stock transfer when consulting with tenants. The Council was also concerned about the need to ensure adequate protection for tenants and staff in any sub-contracting arrangements made as a result of housing stock transfer.[8]

12. The Department has not made any amendment to the draft order as a result of this representation. As the representation relates to the transfer of housing stock to a registered social landlord, rather than to the delegation of housing management, the Department considers that it falls outside the scope and purpose of the proposed order.

13. On the basis of the explanatory statement, we are satisfied that the responsible Minister has had due regard to all other representations made during the period for Parliamentary consideration.

Further debate

14. As we noted in our report on the proposal for the order, many Members have an interest in the application of PFI to local authority housing; it is a matter directly affecting the lives of a large number of their constituents. We met concurrently with the Committee on the Office of the Deputy Prime Minister: Housing, Planning Local Government and the Regions to take evidence on the proposal from the Minister. The active participation of that committee, which has a detailed knowledge of the subject matter, demonstrates that the issue of refurbishment of local authority housing stock, and the use of PFI as a means of securing this refurbishment, is worthy of further scrutiny and debate in the House.

15. However, a debate on the floor of the House on a motion to approve a draft regulatory reform order may take place only if this Committee divides on its formal recommendation to the House that a draft order be approved.[9] If the Committee's recommendation that a draft order be approved is agreed to without a division, the question on any motion to approve a draft order must be put forthwith.[10]

16. We consider that many Members of the House will believe that the introduction of PFI into housing management, particularly in relation to the projects which the passage of the order is intended to enable, is sufficiently important to merit examination of the Government's policy in a detailed debate. The issues to be raised in such a debate are, however, likely to range well beyond the scope of any debate to approve the draft order under Standing Order No. 18. We nevertheless trust that the Government will note the considerable interest which exists, on all sides of the House, in the introduction of PFI in local authority housing management, and that it will therefore consider making suitable provision for its policy to be fully debated.

Recommendations

17. In accordance with Standing Order No. 141(15), we recommend unanimously that the draft order be approved. We trust that the Government will note the considerable interest which exists, on all sides of the House, in the introduction of PFI in local authority housing management, and that it will therefore consider making suitable provision for its policy to be fully debated.

4 Explanatory statement, para 8 Back

5 Explanatory statement, para 6. The Department's initial reasoning is set out in greater detail in Appendix B to our Fifth Report (HC 329, p 29). Back

6 Explanatory statement, para 9. The Committee on Delegated Powers and Regulatory Reform reported on the proposal in its Eighth Report, Session 2002-03, HL Paper 37, paras 1-13. Back

7 Explanatory statement, para 7 Back

8 Explanatory statement, para 2 Back

9 Standing Order No. 18(1)(b). If the Committee recommends that the order not be approved, any subsequent debate on the floor of the House would be on a motion to disagree with the Committee in its report (Standing Order No. 18(2)). Back

10 Standing Order No. 18(1)(a) Back