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4.4 pm
Mrs. Claire Curtis-Thomas (Crosby) (Lab): I should like to begin by thanking the hon. Member for Bromley and Chislehurst (Robert Neill) for his excellent maiden speech. It was marvellous to hear him talk about Eric Forth. I had many arguments with him, but no one can deny that he was a stalwart of this House, or that he did it great service. I know that the hon. Gentleman’s words will have been received very well.
Before I make my contribution on HIPs, I must first declare my interests. I am a chartered engineer and a fellow of the following organisations: the Institution of Mechanical Engineers, the Institute of Electrical Engineers, the Institution of Civil Engineering Surveyors, the Institution of Engineering Designers and the City and Guilds Institute. At various times, I am required to provide information to those bodies, and I have participated in a number of their campaigns in respect of various Bills.
I am also chair of the all-party building services engineering group, which receives support from the Heating and Ventilation Contractors Association. I host meetings in the House for women in plumbing that are sponsored by the Institute of Plumbing and Heating Engineering. I chair the all-party group for construction skills and training, which receives support from the Construction Industry Training Board. For many years I have worked for specialist electrical contractors and for the Electrical Contractors Association. I sit on the board of the Institute of Mechanical Engineers, whose membership includes people working in the housing industry. I am also one of those currently undergoing training so that I can provide home inspection surveys.
I am a member of the Engineering Technology Board, which regulates academic standards in the engineering sector and which will also be responsible for regulating the course provided by Reading university. I sit on the board’s panel that represents the interests of registrants, many of whom have qualified already as home inspectors. In the past eight months, I have met all the chief executives in the sector skills council who represent the interests of companies in the engineering sector, including those that have been heavily involved in giving thousands of people the opportunity to undertake the home inspector’s role.
In addition, I work with all the engineering institutions that have a vested interest in promoting engineering and
the development of vocational and professional standards. I believe that the HIP, and the home condition report in particular, offered an excellent opportunity to improve housing stock over time.
It would be useful to compare the HIP with the MOT test for cars. The MOT was introduced after many years of motoring disasters. The Tories have given various reasons in the debate as to why HIPs should be dismissed, and I have no doubt that they would give the same reasons to reject the MOT if that test were to be introduced today.
The same arguments apply. The MOT test comes at an additional cost that is a burden for car owners, and when the test was introduced the serious problem was that too few people were qualified to carry it out. However, would we seriously suggest today that we should not have the MOT test, given that it has led to significant safety improvements in car production and use? We would not, as the MOT test is a very sensible intervention.
I believe that the HIP is the equivalent of an MOT for houses. It will cost money, but the aim is to ensure that people have safer homes to live in and understand the condition of the houses that they buy. That is what we expect to happen with cars, which cost only a fraction of the price of houses, so why should we not get the same help when we purchase a home?
My hon. Friend the Member for Sheffield, Attercliffe (Mr. Betts) and my right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford) made excellent speeches earlier, and I wholeheartedly support what they said. Like them, I am deeply concerned at the fact that the HIP is not to be introduced next year.
Like my Back-Bench hon. Friends, I support the cause of making home condition reports compulsory, and I do so for the following reasons. When the Housing Bill was introduced, it was argued that HIPs would deliver:
“Transaction Improvements by reducing the abortive costs to consumers and the industry as well as reducing the number of failed transactions caused by survey or valuation inspection findings.”
It was claimed that they would also deliver:
“Housing Stock Condition Improvements by a reduction in the incidence of unexpected repair bills and encouraging better maintenance of homes.”
It was also said that they would create:
“Greater Consumer Choice by reducing the entry costs to first time buyers and creating a market of serious sellers.”
Many colleagues have discussed transaction improvements and greater consumer choice, but I want to concentrate briefly on housing stock condition and the importance of the home condition report. It has rightly been pointed out that many first-time buyers do not engage their own surveyor to assess the condition of the property that they are purchasing, and in many cases they will be purchasing a property with a number of costly problems. Unless the previous owner has taken the time to ensure that all the work undertaken in their home has been carried out by a competent person, the buyer must beware.
Far too many people buy properties with serious problems. They might face serious problems with their electrical distribution capacity. That might mean that they cannot add anything more to their existing
electrical circuits than they already have, or that that they get shocks from systems in their kitchen, or that their lights go out whenever they switch on a radio, simply because their electrical board has not been updated—and does not meet any of the standards introduced by the Office of the Deputy Prime Minister in the past few years.
More worryingly, people might have serious problems with their gas supply and the gas distribution in their home. Unless they have commissioned a survey to determine that, they will find that out the first time someone comes to inspect their boiler. I have spoken to many people who received a nasty shock when their boiler was inspected—not an electrical shock, but a serious shock of a different kind when the inspector said, “I’m now going to switch off your boiler and your gas supply because you’re not safe.” People say in reply, “Well, I bought it only a few weeks ago; it’s a new boiler.” A new boiler is not necessarily a safe gas installation; it is not a safe gas installation when it has not been installed by a competent person.
As much as we would like to think that every such person who comes to our homes is competent to carry out the jobs that we pay them to do, none of us are that naive. Lots of people who come into our homes, and go into the homes of our constituents, profess to be something that they are not. They do not carry industry competence certificates to demonstrate that they are capable of doing the job. It is not only the person who owns that house at that time who suffers as a consequence of that: so, too, does the person who will buy that house in the future.
Let us talk about drainage. Most of us take drainage for granted; we flush the toilet and everything disappears. But that is not always the case. Some people knowingly sell a home that has serious drainage problems. The buyer does not know about that if they have chosen not to have a survey done. The home condition report allows them to know about that, because an assessment of the drainage will have been carried out—and drainage is very expensive. It can cost people tens of thousands of pounds to correct a drain, even when they have insurance cover of the drains within their property. More often than not, the problem is outside the property, and they do not have insurance to cover that. The whole of their drive could be taken up, right back to the main road, and that could cost £10,000. The cost of this report is negligible in comparison, even if the purchaser has to bear it.
What about construction? Many Members have talked about subsidence. As an engineer, I like subsidence; it provides me with a great intellectual challenge, and I have never yet come across an instance of subsidence that I cannot sort out—but that is me. I have looked into the qualifications of Members of this House, and none of them has any of the qualifications that I have, so I am okay on the subject of subsidence. [Interruption.] It is a shame; it is a great shame. I am okay on that, but most people’s biggest worry is subsidence. They are very frightened by the possibility of subsidence, because subsidence means tens of thousands of pounds in costs. It does not mean that to me, but it does mean that to most Members of this House.
When surveyors carry out home condition reports, they do not come in with no knowledge whatsoever. They are not going to see subsidence and then not tell people about it. We are professional engineers, and the people who take this course will be committed to high standards. If they are not going to exhibit high standards, they will be fined. They could be charged and they will be brought into litigation, which would be counterproductive, so they do not want that. Although they might not be able to do anything about a particular incidence of subsidence, they are not going to fail to point it out. Subsidence is pretty obvious—it is not a small crack in the wall that occurs as a result of drying out. It is serious problem, and surveyors will see it, just as I could see it immediately if I walked into a Member’s home that was suffering from it. I would not fail to point it out, because I am a chartered professional engineer and we are required to point it out. Currently, first-time buyers do not get that service if they cannot afford the privilege of accessing that information. Such access is what we need.
The home condition report is not just of use to the person who is purchasing the property; it could save the life of the person selling it, which is why it is important and why we need it. There are too many rogue traders working in this area. Far too many householders enlist the services of people who are supposed to be competent, but are not. I am not going to blame householders for doing so, because the vast majority of us are completely ignorant of this world. We cannot know everything, but we have got to enlist people whom we can trust to help us get good standards at home.
Let us say that I sell my house tomorrow and a surveyor assesses it—looks at my gas and electrical installations, at my property’s construction and at the drainage—and says, “This isn’t right and we are concerned about it; we want to look at your certification.” Then, on my handing them the certification, they say, “Well, it looks pretty, but it is worth nothing—you must have the property surveyed again.” I would want to know that. I have got three children, and I would want to know whether my property was safe. I would then go back to the person who did the work—or try to—and say, “Come on, give me the correct documentation.”
However, most people in that situation will be in for a very nasty shock. They will find out that those who did the work were not competent to do so and cannot supply the certification. At that point, they will learn pretty quickly who is competent to assess home installations. That is great for the building service industry, which is bending over backwards to ensure that only legitimate people undertake work in homes. The big issue that we Members of Parliament deal with is consumer protection and consumers who are being ripped off by unethical traders. This measure—this intervention—has helped to address that problem enormously.
So, like many of my colleagues here today, I regret the fact that the home condition report is not going to be in the home information pack. I understand why it is so important, and what a missed opportunity this is for consumer safety. I know, speaking for all of my colleagues without exception, that they will regret this, but what they will do is wait. If it is a requirement to provide a set number of people to do the job, that will
happen, because we want a safe industry. We want to improve the standards of homes and to make them safer for people. That is what this is all about.
I have heard some pretty adverse comments, but I have not heard Opposition Members talk about consumer safety, which is a pity. I cannot think of any better vehicle than this one to deliver improvements in consumer safety quickly. I urge my hon. Friend the Minister to look again at making home condition reports mandatory, because there is an imperative to do so. I am happy to wait while we sort out the number of people required, invigilation standards and so on, but there is an industry waiting to do this work, and a consumer protection imperative for us to deal with this issue.
4.20 pm
Mr. Geoffrey Clifton-Brown (Cotswold) (Con): The hon. Member for Crosby (Mrs. Curtis-Thomas) spoke for 15 minutes; I shall speak for a mere five to try to allow my colleagues time to get in.
I declare an interest as a fellow of the Royal Institution of Chartered Surveyors. I was also heavily involved in the gestation of the home information pack measures as the official Opposition spokesman on the Homes Bill in 2000, the first that came before us on the matter. I pay tribute to the work done since by official Opposition spokesmen—my hon. Friends the Members for South Holland and The Deepings (Mr. Hayes), for Poole (Mr. Syms) and, in particular, my hon. Friend the Member for Surrey Heath (Michael Gove), who has valiantly campaigned on the issue and who made a very worthwhile speech today.
We are where we are, but I agree with all who have said that we are in the worst of all possible worlds. We have half a compulsory measure, with all the costs that that will involve. For the sake of clarity, I shall quote the relevant paragraph of yesterday’s written ministerial statement:
“This means that the remaining aspects of Home Condition Reports will not be made mandatory from June next year, but HCRs will be authorised documents that sellers will be able to include in their packs.”
The sting in the tail comes next:
“Mandatory HCRs will remain on the table if the industry fails to make a success of the roll out of HCRs.”—[ Official Report, 18 July 2006; Vol. 449, c. 13WS.]
So, we really do not know where we are. We do not know whether they will be made mandatory or not.
I wish to make what I think is a sensible suggestion. Let us leave the system as it is now proposed until the next general election. Let us see whether home information packs do the job that they are supposed to do. If they do, no doubt all parties will wish to include in their manifestos a promise to make HCRs mandatory. But if there are huge problems and if they have not done what they are supposed to do, I have no doubt that the Labour party, as well as my own, will run away from the idea as fast as they possibly can.
I am interested in the costs and benefits. I listened carefully to the right hon. Member for Greenwich and Woolwich (Mr. Raynsford), who was quite right to identify the benefit as being about £1 million a day—some £365 million a year. He went on to say that no proper analysis has been done of the costs, but I shall give him some. The Government have produced figures on the
sellers packs—official figures included in the explanatory notes to the last Bill—showing that the cost without the home condition report would have been £660 per pack, without value added tax. The cost of the home condition report is put at £400, and we could halve that for the environmental statement, which leaves the packs at about £460, or about £550 with VAT. Multiply that by the 1.2 million actual sales each year and we have a cost of about £650 million. In other words, there is a cost-benefit gap of about £300 million. For a benefit of £350 million, we are getting a cost of £300 million. What on earth is the sense of bringing in regulations that cost that amount for that benefit?
There are a number of ways in which the Government could improve the housing market, which, on the basis of 1.2 million sales and average house prices, according to the Halifax, of £176,000, is a market of about £200 billion. There are several things in the market that they should consider. First, what should they do with the home condition inspectors currently under training? There are about 3,000 of them, and a lot are lowly paid people who have invested several thousand pounds of their own savings. They will not know today whether they should continue their training or not. I beg the Government to give those people a clear steer on what they should do.
Other measures that the Government could consider include speeding up e-conveyancing and e-searches. The national information land register has been mentioned today, and of the 175 local authorities represented in the House, only 42 are properly e-enabled. Searches, more than anything else, hold up property transactions, and the Government could do a great deal in that respect. They should also look at estate agents. As has been said, they have a good association, but 30 per cent. of them are not members of it, and a number of that 30 per cent. are complete cowboys. Let us get the estate agents under control with proper regulations.
The Government could do a number of things. They should look carefully at the whole market, if they want to interfere with it as they propose, with the buyer versus the seller, and remember the old maxim, caveat emptor. When buyers look at the packs they will think that they have everything on a plate, but there are still many problems that they will need to consider.
There will be problems with the energy performance certificate and the Government should not underestimate them. The Royal Institution of Chartered Surveyors estimates that the software will be correct for only 80 per cent. of houses and the Government will have more difficulty than they think in providing enough inspectors for the work.
4.25 pm
Nia Griffith (Llanelli) (Lab):
I shall not repeat all the excellent points made by my hon. Friends, as there is little time left for the debate, so I shall focus on energy efficiency. I welcome the intention to include in HIPs information on energy efficiency, including information about how to cut fuel bills and carbon emissions. We are all becoming increasingly aware of the impact of carbon emissions on climate change, but in our busy lives we need reminders and incentives to encourage us to prioritise the issues. The concept of an energy
performance certificate will help all home owners, vendors and purchasers alike, to focus on making their homes more energy-efficient.
Viewing a house on a lovely warm day, such as today, it is easy to forget what it might be like in the middle of winter. First-time buyers in particular can find the whole process of buying a house such an ordeal, with so many different things to think about, that they often overlook the important issue of what the fuel bills are likely to be. It has been my experience as a vendor that hardly anybody looks at energy-saving features and few people ask what my fuel bills are.
Information on energy efficiency is valuable to buyers, enabling them to make a realistic assessment of what their fuel bills are likely to be. It also allows them to make comparisons between the properties that they view. Furthermore, knowing that prospective purchasers will look at the energy efficiency information and compare the likely fuel costs of properties will act as an incentive to vendors to consider how they could make their home more energy efficient. Estate agents’ publicity material will mention more than just double glazing in terms of energy efficiency. People will increasingly talk of homes as “cheap to heat” or “expensive to heat”. As that information becomes more important to prospective purchasers, it is likely to affect property prices; good energy features will be appreciated for the fuel bill savings that they can bring.
In the course of my adult life, I have bought and moved into eight homes, which usually involved improving older properties. I know how overwhelming the process can be, and the energy efficiency information in the pack will provide a useful checklist for people who are thinking about how to improve their property.
Not only will people think about how to insulate their homes better and reduce fuel demand, but the knowledge that when they sell their home it will be judged on its energy efficiency will act as an incentive to consider installing microgeneration equipment for heat or electricity. Only a year ago, my hon. Friend the Member for Edinburgh, North and Leith (Mark Lazarowicz) chose to use his success in the private Members’ Bill ballot to introduce the Climate Change and Sustainable Energy Bill. At that time, few people were talking about energy efficiency or microgeneration, so it is to his credit, with the support of the Minister for Energy, that those issues have gained so much prominence. I thank my hon. Friend the Minister for Housing and Planning for her genuine commitment to try to tackle climate change in her areas of responsibility. It is to her credit that we are even talking about energy performance certificates.
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