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Mr. Davey: The hon. Gentleman must be careful when he quotes Government research. As I understand
it, the original research commissioned by the Government for England and Wales was provided by PS Martin Hamblin, which even now does not list property as one of its specialist market sectors. The Scottish Executive, on the other hand, commissioned research by property experts, DTZ Pieda Consulting, which found results completely at odds with the Government's. There are two different sets of research results. [Interruption.] Hon. Members may try to suggest that Scotland is completely different. [Hon. Members: "It is".] I am afraid that it is not completely different. The evidence from the Scottish Executive says that delays in house transactions come from two main sources—sellers delaying the transaction to give themselves longer to find a new home, which, I am afraid, does happen in England and Wales, and delays caused by buyers whose mortgage finance was not in place, which is also the experience in England and Wales.
David Wright: Does the hon. Gentleman agree with the Minister's opening analysis that the packs will help first-time buyers? I recently met a couple who had attempted three searches on new properties, all of which fell through. The proposal will help first-time buyers. Is he against that?
Mr. Davey: It will not help first-time buyers. Fewer houses will come on to the market. [Interruption.]
David Wright indicated dissent.
Mr. Davey: Hon. Members may say "rubbish". Let me explain why it is not. If one must obtain a home information pack and must spend several weeks before then, paying the cost up front, that will be a deterrent for a lot of people who are coming on to the market. Someone may have gone out for the weekend, with his wife, and seen a house that they want to buy. They couple may want to sell their house as quickly as possible to make sure that they purchase the house that they have seen. In future, such speculative buyers will not arise and will not market their homes, which will mean fewer affordable houses and house prices going up. The effect will be the opposite of what the hon. Member for Telford (David Wright) said it would be.
Mr. John Hayes (South Holland and The Deepings) (Con): Is it not bizarre that the first-time buyers who will be exercising the right to buy—people who have never bought a house in their lives—will not have access to the reports that the Government claim will be so helpful to purchasers?
Mr. Davey: I think that Labour Members are right. My reading of the Bill is that such people will have access to the reports. Local authorities may be worried because their housing departments may face some extra costs, and registered social landlords may also be worried. We may return to that debate in Committee.
Andrew Bennett: Does the hon. Gentleman accept that it might be a good idea to cut down the number of people who speculatively put their houses on the market? Many people put their houses up for sale, get a prospective buyer and then pull out when they find that
they cannot buy somewhere else. If they had had to prepare a buyer's pack, it would prove that they were serious sellers and not someone playing in the market.
Mr. Davey: It is not the Government's job to predetermine who is a serious seller. The process of marketing a property is not straightforward because people's lives change from week to week—they may be offered a promotion that means that they must move somewhere else in the country. Life is not as simple as some Labour Members wish to suggest.
Mr. Davey: If I can make some progress, I will take interventions later. The problem is that the proposal will increase delays in the system that it is supposed to speed up. I have suggested that delays will occur in marketing, and there is also the issue of duplication. The law of contract is about caveat emptor—let the buyer beware. The Bill changes that principle, which is a serious mistake. Buyers will examine the home condition report in the home information pack with a degree of scepticism. I would certainly want my own home condition report, so I would need a second one, especially if a home needed a structural survey. Such duplication would not speed up the process.
Another problem is the availability of sufficient trained staff—the right hon. Member for Skipton and Ripon made this point powerfully. It is estimated that we will need between 5,000 and 8,000 people just to do the extra surveys. Surveys will be needed for homes that will not be sold or repeated by buyers. Where will those people come from and who will meet the cost? If we get a new breed of inspector who is not a fully qualified chartered surveyor, will insurance companies indemnify reports completed by less well trained inspectors? I think not.
We have come to the point that gives the lie to the Minister's continual quoting of the Consumers Association. If consumers buy a property on the basis of a home condition report completed by a less well trained inspector, which may not have the backing of the insurance industry, their consumer protection will be reduced, not increased. I cannot see how it is in consumers' interests to have greater costs through duplication. The Government are laying the ground for a repeat of the mis-selling of pensions scandal. If the legislation is enacted, in a few years' time there will be the mis-surveying of homes scandal, and if that proves to be the case the blame will certainly lie with the Government.
Another element of the legislation that will work against consumers' interests is the fact that home information packs will reduce competition in the market for estate agents and people who help others to market homes. People increasingly use the internet to look for homes or to sell their own homes without going through estate agents. The legislation will prevent that and undermine competition.
The most staggering of the Bill's omissions is that the Government have failed to include a regulatory framework for a tenancy deposit scheme. There is a large amount of support on both sides of the House for such a scheme; there have been trials, a voluntary
scheme, a consultation process and statements from Ministers suggesting that they were in favour of the scheme. The Bill offers a parliamentary vehicle for that much needed measure, yet the Government are blowing it. Even the pre-Budget report gave an indication that the Treasury thought the scheme would be a good idea, but the Government are not taking this opportunity to put it into practice.There would be benefits not only for tenants but for landlords. The private rented sector would be far more attractive if people's deposits were secure and well looked after. What are the Government's arguments for not introducing legislation on the issue? First, they say that there is no parliamentary time. Well, the Bill certainly has enough parliamentary time—we shall be in Committee for quite a while.
Secondly, the Government point to the Law Commission. However, the Law Commission was given a completely different remit, which did not include the proposal for a tenancy deposit scheme. In November, when the commission published its interim report, the proposal was not even touched on. If we wait for the Law Commission to consider the matter, there will be a delay not merely of months but of years, as its final report will be subject to consultation. If the House misses this opportunity to legislate on a tenancy deposit scheme, there will be a delay of several years.
Tenants have waited far too long already. There will be much abuse and many deposits will not be returned by unscrupulous private landlords during the years that we shall have to wait.
Labour Members may have read the briefing provided for the parliamentary Labour party, which suggests that the case for a tenancy deposit scheme has not been well made. For example, it refers to finely balanced benefits and costs and suggests that the benefits of the scheme would amount to only £20 million a year whereas the costs would be £19 million. However, if Labour Members read that briefing carefully, they will find that the figure of £19 million is completely false. It is based on the assumption that every tenant in the scheme would go to the adjudicator with a quarrel about the management of their deposit. In fact, evidence from Australia and New Zealand shows that only between 2 and 3 per cent. of tenants take their case to the adjudicator, so the actual costs of running the scheme would be tiny compared with the amounts cited in the PLP briefing.
The briefing also includes an interesting line that refers to the interest forgone by landlords as one of the costs. Surely, the interest on the deposit should go to the tenant, not the landlord. Labour Members should ask Ministers why they have not answered questions properly and why they oppose a scheme that should have been brought in years ago.
The right hon. Member for Manchester, Gorton raised an issue about which I feel particularly strongly: the Government's failure to legislate on empty homes. They have circulated a consultation paper, which refers to empty property management orders. That would be a good way forward. The Government are consulting on the issue, but they could use the Bill to tackle the problem. The Minister made several references to affordable housing in his opening remarks. One of the quickest, cheapest and most environmentally
sustainable ways of dealing with the problem of affordable housing would be to ensure that empty homes are brought back into use. It is a scandal that there are hundreds of thousands of empty homes that could be used for homeless people or people living in poor accommodation.The Government should get on with the job. They should get on with the consultation process and ensure that provisions are included in the Bill before we lose this parliamentary opportunity. The provisions would fit well in the part of the Bill that deals with interim and final management orders. Such a structure has links with some of the proposals in the consultation paper.
The Government should introduce legislation on park homes, as has been mentioned. They should provide a new and up-to-date definition of overcrowding, as we need to understand the extent of the problem so that we can plan housing policy properly.
We have some concerns about the Government's proposal to enable the Housing Corporation to give grants to private developers, although the House may be surprised to learn that we are not quite as opposed to it as the right hon. Member for Skipton and Ripon, who seemed extremely worried by it. In fact, the arguments are finely balanced. The idea that the private sector cannot be given money to build affordable social housing does not seem wrong in principle. Perhaps we should allow different types of provider—mutuals, RSLs and the private sector—to build affordable homes if that is the most effective use of taxpayers' money. There may be problems—such as those of accountability, about which we have heard—and we need to ensure that the RSL sector will not be damaged, given that some in that sector use that money to cross-subsidise the provision and repair of their other housing stock. We will want to tease out some issues, but we will not necessarily be completely against that proposal.
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