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Standing Committee Debates
Local Government Bill

Local Government Bill

Column Number: 175

Standing Committee A

Thursday 30 January 2003


[Mr. Win Griffiths in the Chair]

Local Government Bill

8.55 am


That the Programming Order of 21st January be amended, in the table, by—

    (1) leaving out '1st to 6th' and inserting '1st to 7th';

    (2) leaving out '5 pm at 6th sitting' and inserting '11.25 am at 7th sitting';

    (3) leaving out '7th to 11th' and inserting '8th to 11th'.

Clause 11

Use of capital receipts

Amendment proposed [28 January]: No. 66, in

    clause 11, page 5, line 4, at beginning insert

    'Subject as provided in subsection (2)'.—[Mr. Hammond.]

Question again proposed, That the amendment be made.

The Chairman: I remind the Committee that with this we are discussing the following amendments:

No. 59, in

    clause 11, page 5, line 4, leave out from 'State' to end of line 5 and insert

    'shall not in any circumstances interfere in the use of capital receipts by local authorities.'.

No. 69, in

    clause 11, page 5, line 4, after 'use' insert 'by a local authority'.

No. 70, in

    clause 11, page 5, line 5, leave out 'a' and insert 'that'.

No. 60, in

    clause 11, page 5, line 6, leave out subsection (2).

No. 61, in

    clause 11, page 5, line 6, leave out from beginning to end of line 22.

No. 67, in

    clause 11, page 5, line 6, leave out 'in particular'.

No. 51, in

    clause 11, page 5, line 7, leave out from beginning to end of line 10.

No. 62, in

    clause 11, page 5, line 11, leave out from beginning to end of line 12.

No. 3, in

    clause 11, page 5, line 11, leave out from 'requiring' to 'of' and insert

    'such amount as the Secretary of State shall specify, being not more than 20 per cent.'.

No. 40, in

    clause 11, page 5, line 12, at end insert—

    '(c) make provision requiring an amount not exceeding sixty per cent. of a capital receipt to be used only to meet capital expenditure in connection with the local authority's functions under part II of the Housing Act 1985 (provision of housing).'.

No. 63, in

    clause 11, page 5, line 12, at end insert—

Column Number: 176

    '(2A) Regulations made under subsection (2)(b) may only include the following in relation to payments to the Secretary of State—

    (a) in relation to the disposal of dwellings, the maximum amount that can be specified is 25 per cent. of the capital receipt; and

    (b) in relation to the disposal of any other asset, the maximum amount that can be specified is 15 per cent. of the capital receipt.'.

No. 39, in

    clause 11, page 5, line 14, after '2(b)', insert 'and 2(c)'.

Government amendment No. 25.

No. 41, in

    clause 11, page 5, line 20, leave out subsection (5).

Mr. Desmond Swayne (New Forest, West): The Minister was determined to make the case that his proposals were designed to generate more revenue for expenditure on housing. I do not doubt for a moment his sincerity in seeking to achieve that objective. My concern is that the proposals will have the opposite effect.

The Select Committee's report refers to the evidence produced by CIPFA. It quotes Mr. Bisland of CIPFA as saying:

    ''I think it is more likely that Members are going to be reluctant to sell assets if they think they are going to be pooled''.

The Minister for Local Government and the Regions (Mr. Nick Raynsford): May I short-circuit this discussion and save the Committee a lengthy detour and the hon. Gentleman some embarrassment by pointing out that the policy that we propose relates only to receipts from the sale of council houses. The council itself has no discretion. It cannot generate sales. It is entirely a matter for the house buyer to decide whether they wish to exercise the right to buy. I am afraid that Mr. Bisland's argument has no force or effect.

Mr. Swayne: Ah, well, I will illustrate that the principle of what Mr. Bisland said still holds good. I will refer to an asset currently possessed by New Forest district council, which falls within the terms of subsection (4)—a mobile home park worth in excess of £11 million. It seems reasonable to ask why a district council is sitting on such an asset when there is a such a shortage of affordable and social housing in the New Forest, not least because of the Minister's Whitehall-imposed policy, which prevents the district council from using its resources to acquire more housing of that nature, but rather directs it to use those resources to renovate its existing housing stock. Such a policy might be appropriate to a northern metropolitan council that has not maintained its stock over many years, but it is inappropriate to the New Forest.

I leave that matter aside, as I am sure that the Minister would not want me to go down that road.

Mr. Raynsford: The hon. Gentleman appears determined to dig himself further into his hole. Nothing in our proposals would impact on this mobile home park in the New Forest, because its occupants will not have the right to buy and therefore the proceeds from any sales will not be subject to the pooling procedures.

Column Number: 177

The Chairman: Order. You are pursuing an interesting point, Mr. Swayne, but under which amendment are you raising it?

Mr. Swayne: Amendment No. 59, Mr. Griffiths. It has a certain simplicity and attraction. The difficulty that the members of the council face in disposing of the asset is that there is a political cost, because the occupants of the park do not want it to be sold. They would much rather that it be owned by the district council than by that unique breed, the owners of mobile home parks, who, as I am sure the Minister is aware, often lack the social and managerial skills required to make a success of them.

While the law is so stacked against the tenants, they do not want to be sold off by the district council, so there is a political penalty. The district council has to balance the question of selling the asset to generate revenue to provide housing against the political cost of the campaign mounted by the residents not to be sold off. If the district council will not retain any of the revenue for its own purposes, the motive for selling will disappear and councils will sit on such assets rather than lose control of them.

Kali Mountford (Colne Valley): I am confused by the hon. Gentleman's inconsistency. How does what he is saying fit with his party's previous policy of allowing councils to use such capital receipts only to repay debt?

Mr. Swayne: The repayment of debt is a perfectly legitimate use of such assets, because it creates the financial circumstances that enable councils to build. To me, that is evident and straightforward.

9 am

Mr. Philip Hammond (Runnymede and Weybridge): I am grateful to my hon. Friend for raising the important issue of mobile home parks, because it is a little known fact that my constituency in Surrey has the second largest number of permanent mobile homes of any parliamentary constituency in the country. That is known by some hon. Members. I can tell the Government Whip, the hon. Member for Oldham, East and Saddleworth (Mr. Woolas), that the hon. Member for Lancaster and Wyre (Mr. Dawson) and I see eye to eye on this issue, although we have little in common politically on any other subject. In fact, his constituency has the largest number of mobile homes.

This important issue is not the Minister's direct responsibility, but he will be concerned to learn that a significant proportion of the mobile homes in my constituency have recently been under water. That in itself is cause for grave concern, although I know that the Office of the Deputy Prime Minister is not responsible for the Environment Agency.

Mr. Raynsford: In the bipartisan spirit of the hon. Gentleman's remarks, may I say that I had great pleasure in visiting a mobile home park in the constituency of my hon. Friend the Member for Lancaster and Wyre. I suggest that the hon. Gentleman pay a visit to the mobile homes in the constituency of the hon. Member for New Forest, West (Mr. Swayne) to tell those constituents about their legal position? Their Member of Parliament

Column Number: 178

appears to be labouring under the delusion that they might benefit from the right to buy.

Mr. Hammond: I do not think that my hon. Friend labours under any such delusion, but I shall be very happy to visit the mobile home dwellers in his constituency when I have a moment free. At the moment, I am required to visit my own. Tomorrow evening, I shall talk to a group of them about the rather perilous circumstances in which they have found themselves as a result of floodwater—not as a result of recalcitrant landlords on this occasion.

All joking aside, the Minister will know that the legal position of mobile home owners is far from satisfactory. His noble Friends are discussing the subject with members of the all-party parliamentary group for the welfare of park home owners, and I hope that the Minister's Department will find some legislative time for it. It is a shame that there is nothing on the matter in the Bill, but we hope that it will be included in the draft housing Bill. The Minister is adopting the posture of someone at an auction; he is carefully not moving his head a millimetre in any direction, lest it be construed as a signal that he did not intend to send.

I return to this group of amendments and the Minister's hurried reply at the end of our last sitting when time was short. We had a long debate on the proposals, but members of the Committee may wish to explore some of the issues raised in the light of the Minister's reply.

The Bill has been presented as giving freedom to local authorities, but the clause does precisely the opposite. The Minister seems to expect to receive plaudits for having made a modest, and probably administratively essential, concession to the 34 debt-free local authorities that will be most significantly affected by the measure. The transitional arrangement that the Minister announced on Tuesday is an improvement, but it is a concession made by the emperor rather than the underpinning of a genuine dispersion of power to the local authorities—


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Prepared 30 January 2003