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Notification of Redundancy

Mr. Jim Cunningham accordingly presented a Bill to make provision with regard to notices of redundancy; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 16 June, and to be printed. [Bill 171].

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Orders of the Day

Housing Corporation (Delegation) etc. Bill

Order for Second Reading read.

3.47 pm

The Minister for Housing and Planning (Yvette Cooper): I beg to move, That the Bill be now read a Second time.

This is a short, two-clause Bill, which is designed to deal with technical problems that have arisen due to an omission in the legislation governing the powers of the Housing Corporation. Those difficulties arose following recent legal advice to the Housing Corporation, which has subsequently been confirmed to the Government. The advice makes it clear that the Housing Corporation board does not have any express power in legislation to delegate statutory functions below board level and that such a power cannot be implied by the terms of the statute.

Prior to that advice, the Housing Corporation and everyone else believed that the board had an implied power to delegate its functions. Indeed, since its inception over 40 years ago, the corporation has been acting on that basis in good faith. That means that the Bill needs to fulfil two functions. First, the Housing Corporation needs to be put on the same footing as other non-departmental public bodies and given the explicit power to delegate functions below board level. Secondly, the Bill needs to deal with any uncertainty about historic decisions made by the Housing Corporation to ensure that no problems about past decisions arise inadvertently either for the corporation or for housing associations and lenders.

The Bill gives the Housing Corporation board the express power to delegate its functions to members, committees and employees and it will have retrospective effect in deeming the corporation always to have had such a power. The effect will be to restore the status quo, bringing the corporation and other interested parties back to the position that they believed they were in before the problem was discovered. The Bill does not confer any new powers or functions on the Housing Corporation.

I had a bet with the Under-Secretary of State, Office of the Deputy Prime Minister, my hon. Friend the Member for Poplar and Canning Town (Jim Fitzpatrick), who will reply to the debate on the Bill, about the number of hon. Members who would remain in the Chamber at the point when I concluded my speech. On the current count, I am still winning the bet, but I concede that this is not the sexiest piece of legislation that the House has had to debate. Nevertheless, it is important for the Housing Corporation and those tenants who live in registered social landlord properties across the country.

I hope that the Bill will have widespread support from hon. Members across the House. I thank the Opposition spokesman for meeting the Housing Corporation and the Council of Mortgage Lenders to be briefed on the Bill. I know that they will understand that while this is a minor legislative change with technical effect, it is important for the operations of the corporation and for the decisions made by housing associations and lenders.
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There are areas of housing policy on which there are strong differences of opinion between the parties, and I am always keen for an opportunity to debate those dividing lines, but on this occasion I hope that the whole House will support the measures. They are sensible measures that remedy problems with previous legislation for the Housing Corporation. It is important that the Housing Corporation can conduct its business effectively. The corporation is a non-departmental public body of the Office of the Deputy Prime Minister, and was established under the Housing Act 1964 to oversee the housing association sector. Its legislative provisions, role and functions were updated and amended in the Housing Associations Act 1985 and in the Housing Act 1996.

Today the Corporation plays a crucial role in regulating nearly 1,800 housing associations that own or manage more than 2 million units of social housing and provide a range of other services to the broader community. The corporation also delivers the funding allocations for new social housing and shared equity homes in England through the national affordable housing programme, which for 2006 to 2008 involves £3.9 billion of investment to deliver an estimated 84,000 affordable homes.

Tony Baldry (Banbury) (Con): I would hate the Minister to think that we were not all listening. I am grateful to her for giving way. Of the money that the Housing Corporation allocates, very little seems to come to shire districts such as mine, where there were two large-scale voluntary transfers. So we have two new housing associations; neither of them is particularly big, and neither of them is doing any new build. As a consequence, there is a black hole and the only way in which working families can now get housing is in the private rented sector, which just does not provide stability. I wonder how the Minister sees the Housing Corporation allocating funds to areas such as mine where there are working families in need of social housing, as in other parts of the country.

Yvette Cooper: The hon. Gentleman makes an important point about the need for social housing but also for shared equity homes, which many people now want in order to make the first step on the housing ladder. The corporation allocates its funding according to the principles set out by the regional housing board, so I certainly urge him to make his concerns known to the board if he feels that distribution in his area is not appropriate. The Housing Corporation also works with bids that come in so he may want to talk to the newly established housing associations in his area about putting in bids for future allocations of social housing and affordable housing.

We have made it clear that we think that we need to increase the provision of social housing and shared equity homes across the country, and we are funding a 50 per cent. increase over the next few years. We also think that that needs to be a priority for the spending review, so I assure the hon. Gentleman that we are committed to increasing social housing and affordable housing across the country, and I urge him to talk to his local agencies about ensuring that there is an appropriate allocation for his area.
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The decisions that the Housing Corporation takes around regulation and funding allocations have huge implications for housing associations, for lenders and most importantly of all for the tenants who live in housing association homes. The corporation has an impact on the lives of several million people, many of whom are among the most vulnerable in the country. Given these important roles in regulation and allocation of public funds, it is critical that they are able to operate without any legal uncertainty around the decisions that they take.

The Bill has two clauses. Clause 1(1) gives the corporation an express power going forward to delegate the exercise of its functions to individual members of its board, its committees, sub-committees and employees. At the time of the Housing Corporation's creation it was common for public bodies and other NDPBs not to be given an explicit power of delegation, primarily because such bodies took fewer statutory decisions and it was plausible at that time for all these decisions to be carried out by the board.

Since then, the vast majority of those bodies have become defunct or their founding legislation has been modernised and they have been given an explicit power of delegation. Similar non-departmental public bodies set up in more recent years that operate with public funding or with regulatory roles have express powers so that the board can delegate their statutory functions appropriately. English Heritage, which was set up in the 1980s, English Partnerships, the Audit Commission, the Commission for Social Care Inspection, and the Commission for Healthcare Audit and Inspection all have express powers to delegate.

Mr. Peter Bone (Wellingborough) (Con): When Parliament originally set up the Housing Corporation in 1964, there was no intention that it should have an express power of delegation. Is it not the case, therefore, that the Government wish to pass retrospective legislation, even though that was not originally intended by Parliament?

Yvette Cooper: It was not practice at the time to include such an express power. After its inception, the Housing Corporation believed that it had implied power in legislation to delegate its functions to its committees and sub-committees, as other organisations delegated such functions. The legal advice that the corporation received at the end of last year made it clear that it does not have that express power, and that it cannot assume that there is such a power in legislation. However, the corporation has been operating on that basis for decades, and lenders, successive Governments and agencies that worked with it made decisions in good faith on the basis of that understanding.

Clause 1(1) is not retrospective, as it establishes a power for the future. It brings the corporation's powers into line with the vast majority of other such bodies. It allows for administrative efficiency, because it is clearly not practical, given the number of statutory decisions that must be made by the corporation on a day-to-day basis for all such decisions to be taken by the board itself. We have attempted to discover from old files why consideration was not given to updating the provisions on the Housing Corporation in the many pieces of housing legislation passed since 1964, including the
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Housing Associations Act 1985 and the Housing Act 1996. It appears either that there was administrative error about the need for such provision, or that there was genuine belief on all sides that the existing legislation was sufficient.

As I have made clear, revised legal advice to the Housing Corporation at the end of last year confirmed that there was no such express power. Since receiving that advice, the Housing Corporation board put in place alternative methods of working to ensure that all subsequent decisions were made by the board. That is clearly an impractical way for it to continue to operate in the long term, but I thank board members who had to put in considerably more time than they anticipated during those months.

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