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THESE NOTES REFER TO THE HOUSING BILL THE HOUSING BILL
EXPLANATORY NOTESINTRODUCTION 1. These explanatory notes relate to the Housing Bill as introduced in the House of Commons on 8th December 2003. They have been prepared by the Office of the Deputy Prime Minister in order to assist the reader of the Bill and to help inform debate on it. They do not form part of the Bill and have not been endorsed by Parliament. 2. The notes need to be read in conjunction with the Bill. They are not, and are not meant to be, a comprehensive description of the Bill. So where a clause or part of a clause does not seem to require any explanation or comment, none is given. SUMMARY 3. This Bill will replace the existing housing fitness standard with the Housing Health and Safety Rating System. It will introduce two new licensing regimes for private rented properties. There will be a new requirement to produce a home information pack before marketing a property. The Bill makes other provisions about housing, including changing the right to buy scheme. BACKGROUND 4. Details of the legislative framework for each of the provisions of the Bill is contained in the overview. 5. The Bill will take forward provisions contained in the Housing Green Paper (2000) and subsequent policy statement, and responses to these documents. 6. The main provisions of the Bill have been subject to public consultation, including consultation and pre-legislative scrutiny following the publication of the draft Housing Bill in March 2003. OVERVIEW 7. These notes are divided into seven main parts, reflecting the main parts of the Bill. [Bill 11—EN] 53/3 Part 1 - Housing conditions Part 2 - Licensing of houses in multiple occupation Part 3 - Selective licensing of other residential accommodation Part 4 - Additional control provisions in relation to residential accommodation Part 5 - Home information packs Part 6 - Other provisions about housing Part 7 - Supplementary and final provisions Expressions and abbreviations used throughout these notes 8. Local housing authority is defined in clause 196. Throughout these notes this has been abbreviated to LHA. 9. House in Multiple Occupation is defined in clauses 191 to 195. Throughout these notes, this has been abbreviated to HMO. 10. Interim Management Order and Final Management Order are covered by Part 4 of the Bill. For the purposes of these notes, they are referred to as IMOs and FMOs. 11. The Bill confers powers to make secondary legislation and give approvals on the appropriate national authority. This is defined in clause 196 (1) to mean the Secretary of State in relation to England and the National Assembly for Wales in relation to Wales. Part 1: Housing conditions 12. Part 1 of the Bill replaces the existing housing fitness standard contained in the Housing Act 1985 with the Housing Health and Safety Rating System (HHSRS). It also adapts and extends the powers currently available to LHAs to tackle poor housing conditions by means of enforcement. 13. These changes are intended to help LHAs to prioritise their intervention based on the severity of the health and safety hazards in the home. 14. The new framework is largely through free-standing provisions, although some of the provisions of the 1985 Act will remain in that Act with appropriate amendments. Part 2: Licensing of houses in multiple occupation (HMOs) 15. Part 2 of the Bill introduces mandatory licensing of larger, higher-risk HMOs. It will also allow discretionary licensing if LHAs wish to extend the licensing regime to other HMOs in certain circumstances. 16. The term "house in multiple occupation" (HMO) applies to a wide range of housing types, mainly in the private rented sector, that are typically occupied by young lower-income single people, including some particularly vulnerable and disadvantaged groups. Physical and management standards in HMOs are often low. Current statutory controls on HMOs are confusing and have grown up over several decades. 17. Part 11 of the Housing Act 1985 will be repealed. The provisions in the Bill will be free-standing and will include a new definition of HMO for housing law purposes. Part 3: Selective licensing of other residential accommodation 18. Part 3 of the Bill introduces a power for LHAs to introduce selective licensing to deal with particular problems in an area. Selective licensing will be primarily focused on: — areas of low housing demand; — areas that are likely to fall into that category; and — other areas suffering from a particular problem, such as anti-social behaviour.19. Low house prices in areas of low demand have resulted in unprofessional landlords purchasing properties to rent. These people often show no interest in managing their properties properly, often letting to anti-social tenants. These can create misery for the local community causing further destabilisation to these areas. 20. Areas other than those of low housing demand can also suffer destabilisation from the activities of poor landlords and anti-social tenants. So this power will be available to LHAs to tackle these problems outside areas of low demand. 21. The Bill provides a discretionary power, subject to carrying out consultation and to the approval of the appropriate national authority, for LHAs to license all private landlords in a designated areas so as to ensure that a minimum standard of management is met. Selective licensing would be part of a wider strategy to deal with anti-social behaviour and the regeneration of an area. 22. The Bill also provides the appropriate national authority with powers to prescribe by regulation other circumstances in which discretionary schemes may be made. Part 4: Additional control provisions in relation to residential accommodation 23. Part 4 contains provisions for enforcement action in respect of properties licensable under Parts 2 and 3. Part 5 - Home information packs 24. Part 5 of the Bill introduces a new legal duty on people marketing residential properties in England and Wales. Before marketing a property, the seller or, more usually, their agent must have a home information pack of standard documents available for prospective buyers. 25. These proposals were contained in the seller's pack provisions of the Homes Bill introduced in Parliament in 2000. That Bill fell when Parliament was dissolved for the general election in 2001. The provisions in this Bill are similar to those in the Homes Bill, except that the description "home information pack" has replaced "seller's pack" and enforcement of the pack duties is proposed to be by civil rather than criminal remedies. 26. In England and Wales, an offer to buy a property and acceptance of that offer are made "subject to contract". Such an offer and its acceptance do not constitute a legally binding agreement. This is usually only achieved with an exchange of contracts. Between agreeing terms and exchanging contracts, both the buyer and seller do a number of things. For the seller, this could include:
27. The buyer will carry out local land charges searches and other enquiries of the local authority and other organisations. If required, the buyer will also arrange a survey. 28. These documents and information are important to the decisions home buyers and sellers need to take and yet, under current practices, they normally become available only after terms have been negotiated and agreed "subject to contract". 29. Part 5 of the Bill aims to bring forward the availability of this sort of information to the very start of the process. It requires the person marketing a residential property with vacant possession to have a home information pack before marketing the property. The pack is expected to contain documents and information similar to those mentioned above, including a report on the condition of the property. Part 6: Other provisions about housing 30. The Bill allows an LHA to increase the duration of an introductory tenancy by six months and establishes a procedure by which the decision to do so may be reviewed. The new provisions only apply to new introductory tenancies granted after this Bill comes into force. 31. Part 6 will also introduce changes to the Right to Buy (RTB) scheme. This is a statutory scheme enabling secure tenants to buy the homes that they live in, at a discount, from their landlord. Landlords are most often LHAs, but Registered Social Landlords may also have tenants who have the RTB, both for historical reasons and as a result of large-scale voluntary transfers of properties from LHA ownership. Provisions in the Bill will amend the RTB scheme with a view to curbing abuses by property developers and tenants. 32. Provisions in Part 6 will equalise the position between unmarried different sex couples and same sex couples with regard to succession to Rent Act, assured, secure and introductory tenancies. 33. The powers of the Housing Corporation and the National Assembly for Wales under the Housing Act 1996 will be extended to allow them to give grants to bodies other than Registered Social Landlords for specified purposes. 34. Part 6 sets up the office of Social Housing Ombudsman for Wales (SHOW) to investigate complaints against social landlords in Wales. 35. Part 6 will extend eligibility for disabled facilities grant to include all those occupying caravans as their only or main residence. Part 7: Supplementary and final provisions 36. Part 7 requires LHAs to keep registers of licences and management orders. It also provides for the approval of statutory codes of management practice, and for the making of management regulations, relating to HMOs. 37. For the purposes of Parts 1-4 of the Bill it provides for documents and other information to be produced. It provides for powers of entry to property and to prescribe for the production of forms, licences and other documents. 38. Its other supplementary provisions provide for the way in which orders and regulations are to be made and for offences. It allows that local inquiries may be held in relation to LHA functions under the Act. 39. Part 7 is fundamental to the provisions in Part 2 by providing, in conjunction with Schedule 9, a definition of 'house in multiple occupation (or "HMO"). TERRITORIAL APPLICATION 40. The Bill has been drafted in liaison and agreement with the National Assembly for Wales. 41. All provisions of the Bill apply to England and Wales with two exceptions, clause 169 and Schedule 8, which make amendments to the Housing Act 1996 so as to provide for a Social Housing Ombudsman for Wales. These amended provisions will only apply in relation to Wales. COMMENTARY ON CLAUSES PART 1 - HOUSING CONDITIONS Chapter 1 - Enforcement Of Housing Standards: General Clause 1: New system for assessing housing conditions and enforcing housing standards 42. Clause 1 introduces a new system for assessing housing conditions and provides for that system to be used in the enforcement of housing standards. 43. Subsection (2) provides for the new system to operate by reference to the existence on residential premises of category 1 or category 2 hazards (defined in clause 2), and to replace the existing system based on the test of fitness for human habitation in s604 of the Housing Act 1985 ("the 1985 Act"). 44. Subsection (3) introduces the kinds of enforcement action, which will be available to LHAs under the Bill. These are set out in Chapter 2 of Part 1 of the Bill, and in provisions of the 1985 Act which are substituted by Chapter 3 of Part 1. 45. Subsections (4) to (8) define some of the terms used in Part 1 and provide interpretation of references in Part 1 to HMOs and flats. 46. The purpose of the assessment system introduced by clause 1 is to apply objective information to the taking of enforcement decisions by LHAs. It is intended that HHSRS will enable LHAs to assess 29 broad categories of hazard and, by means of the method to be prescribed in regulations under clause 2(2) and (3), provide a rating for each hazard. The assessment will be based on the risk to the actual or potential occupant of residential premises who is most vulnerable to that risk. For example, elderly people are considered most vulnerable to hazards relating to stairs. Clause 2: Meaning of "category 1 hazard" and "category 2 hazard" 47. Subsection (1) provides a definition of "hazard" for the purposes of Part 1. It also provides for the prescription by regulations of two categories of hazard - category 1 and category 2 - according to their seriousness as calculated under the method prescribed in regulations under subsections (2) and (3). 48. Under subsections (2) and (3) a method for calculating the seriousness of hazards on residential premises may be prescribed by secondary legislation. It is intended that, as a result of that calculation, hazards will be placed in a prescribed band determined by their score. Hazards falling within bands A to C are to be described as category 2 hazards. Under clause 5, LHAs will have a general duty to take action to deal with category 1 hazards, and under clause 7 they will have discretionary powers to take action to deal with category 2 hazards. 49. The enforcement action an LHA takes under the provisions of Part 1 will be based on (a) the Band into which the hazard falls as a result of the HHSRS calculation; (b) whether the LHA has a duty or a power to act; and (c) the LHA's judgement as to the best means of dealing with that hazard. Clause 3:Local housing authorities to review housing conditions in their districts 50. Subsection (1) requires LHAs to consider the housing conditions in their district at least once a year, in order to determine what action to take under the provisions mentioned in subsection (2). This provision replaces, with modifications, section 605 of the 1985 Act. 51. Subsection (2) specifies the provisions to which the duty in subsection (1) applies. These include the powers and duties in Parts 1 to 4 of the Bill, together with those in other legislation which enable LHAs to declare a renewal area and provide financial assistance towards the cost of improvement and repair of residential property. Clause 4: Inspections by local housing authorities to see whether category 1 or 2 hazards exist 52. This provision replaces, with modifications, section 606 of the 1985 Act. Subsections (1) and (2) require the proper officer of an LHA, on receipt of a complaint from a Justice of the Peace or a parish or community council that a category 1 or 2 hazard may exist on residential premises, or that an area should be dealt with as a clearance area, to inspect the premises or area. This is in addition to the duty upon an LHA under subsection (3) to arrange an inspection of residential premises if it has reason to believe that a category 1 or 2 hazard may exist there. 53. Inspections of premises under this clause must be carried out in accordance with regulations made under clause 2(2). Where, following an inspection, the proper officer is of the opinion that a category 1 hazard exists on residential premises, or that an area should be declared a clearance area, he is required to make a report in writing to the LHA, which must consider the report as soon as possible. Clause 5: Category 1 hazards: general duty to take enforcement action 54. Clause 5 provides a general duty on LHAs to take enforcement action where there is a category 1 hazard as defined in clause 2. Subsection (1) sets out the courses of action that may be available to the LHA: — to serve an improvement notice under clause 9; — to make a prohibition order under clause 18; — to serve a hazard awareness notice under clause 26; — to make a demolition order under s265(1) or (2) of the Housing Act 1985 as substituted by clause 38; — to declare a clearance area under s289 (2) of the 1985 Act as substituted by clause 39.55. Under subsections (3) and (4), the LHA is under a duty to take the best of the courses of action available to it in relation to the hazard. Clause 8 enables the appropriate national authority to give guidance to LHAs on which course of action to take where more than one course of action is available under clause (2). 56. Subsection (5) enables an LHA to take the same course or a different course of action if the action already taken has not proved satisfactory. It also provides that, where an LHA has given notice, under section 289 of the 1985 Act, that it intends to declare a clearance area containing a property to which the duty in clause 5 applies, but has decided to exclude that property from the area, it remains under a duty to take one of the remaining courses of action in clause 5(2) in relation to the hazard. Clause 6: Category 1 hazards: how duty under section 5 operates in certain cases 57. Clause 6 enables an LHA, instead of making a prohibition order or a demolition order under clause 5(2) in respect of a property, to make instead a determination under section 300(1) or (2) of the 1985 Act, enabling it to purchase the property if it is capable of providing adequate accommodation for temporary housing use. Clause 6 also provides that the option of declaring a clearance area under clause 5(2) is not available to an LHA in respect of a property if that property has already been proposed for inclusion within a clearance area but excluded from it. Clause 7: Category 2 hazards: power to take enforcement action 58. Clause 7 lists the powers available to LHAs to take enforcement action where there exists on residential premises a category 2 hazard as defined in clause 2. Subsection (2) sets out the courses of action that may be available to the LHA: — to serve an improvement notice under clause 10; — to make a prohibition order under clause 19; — to serve a hazard awareness notice under clause 27; — to make a demolition order under s265 (3) or (4) of the Housing Act 1985 as substituted by clause 38.59. Subsection (3) makes clear that an LHA can take the same course or a different course of action if the action already taken has not proved satisfactory. Clause 8: Guidance about inspections and enforcement action 60. Clause 8 enables the appropriate national authority to give statutory guidance to LHAs on their use of the enforcement functions set out in clauses 5 and 7, and places a duty on LHAs to have regard to such guidance. The guidance will apply both where an LHA is exercising a duty in respect of a category 1 hazard and where it is exercising a discretionary power to take action in respect of a category 2 hazard. Chapter 2 - Improvement Notices, Prohibition Orders and Hazard Awareness Notices Clause 9: Improvement notices relating to category 1 hazards: duty of authority serve notice 61. Subsection (1) provides that if a category 1 hazard exists on any residential premises, serving an improvement notice is one of the courses of action available to an LHA in discharging its general duty under clause 5 to take the most appropriate enforcement action to deal with such a hazard, so long as the premises in respect of which the notice is to be served are not the subject of an IMO or FMO under Part 4. 62. Subsection (2) explains that an improvement notice is a notice requiring the person on whom it is served to take the remedial action specified in the notice. 63. Subsection (3) sets out the premises and common parts in respect of which an improvement notice may require remedial action to be taken. Subsection (4) restricts remedial action in respect of non-residential premises to cases where the deficiency giving rise to the hazard is located there, and the remedial action is necessary for the health or safety of actual or potential residential occupiers. 64. Subsection (5) provides that the remedial action must, as a minimum, remove the category 1 hazard, but may go further. 65. Subsection (7) provides that the operation of a notice may be suspended in accordance with clause 12. Clause 10: Improvement notices relating to category 2 hazards: power of authority to serve notice. 66. Subsection (1) provides a discretionary power for an LHA to serve an improvement notice if it is satisfied that a category 2 hazard exists on residential premises and the premises in respect of which the notice is to be served are not the subject of an IMO or FMO under Part 4. 67. Subsection (2) explains that an improvement notice is a notice requiring the person on whom the notice is served to take the remedial action specified in the notice. 68. Subsection (3) applies subsections (3) and (4) of clause 9, which set out the premises and common parts in respect of which an improvement notice may require remedial action to be taken, and enable action to be taken in respect of non-residential premises if the deficiency giving rise to the hazard is located there and the remedial action is necessary for the health or safety of actual or potential occupiers. 69. Subsection (6) provides that the operation of a notice may be suspended in accordance with clause 12. Clause 11: Contents of improvement notices 70. Clause 11 sets out the mandatory contents of improvement notices, which include the details of the hazard and the category into which it falls, the remedial action to be taken and the period of time allowed for compliance. As more than one hazard may be dealt with in the same notice, the notice will be able to prescribe different deadlines for completion of the various actions required. The notice must also contain information about the right to appeal the notice and the time limits for such appeal. Under clause 11(3), a notice cannot require remedial works to start within 28 days of the date of service of the notice. Clause 12: Suspension of improvement notices 71. Clause 12 provides for the suspension of an improvement notice at the LHA's discretion. A notice may for example be suspended until such time as the current occupant ceases to occupy the premises. The notice may specify an event, such as non-compliance with an undertaking given to the LHA by the person, on whom the notice is served, that will trigger the end of the suspension. Guidance on the use of suspended notices will be issued under clause 8. Clause 13: Operation of improvement notice 72. Clause 13 provides for the operation of improvement notices. Notices, as a general rule, will come into operation 21 days after they are served. Notices whose operation is suspended will become operative at the end of the suspension period. 73. Subsection (5) provides for the notices against which appeals are brought under Part 3 of Schedule 1 to become operative in accordance with paragraph 19 of that Schedule. 74. Subsection (6) has the effect of preventing any appeal against the contents of a notice more than 21 days after it has been served. |
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