Housing Corporation (Delegation) etc. Bill

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Yvette Cooper: The debate on clause 1 has ranged widely, and I should like to respond to some of the points made.
The hon. Member for Surrey Heath began by sympathising with me for my seasonal malady. It is seasonal, although it is provoked by pollen rather than by a virus. Since hay fever is not yet contagious, he escapes blame. I also assure him that he need not worry about how close he gets to us.
The hon. Gentleman raised a series of questions for the Government, which I shall try to answer. The first was about what he described as an audit of non-departmental public bodies. My hon. Friends the Members for Liverpool, Walton, for Wallasey and for Milton Keynes, South-West also referred to the issue.
The officials in the Office of the Deputy Prime Minister have done an audit of all the non-departmental public bodies that report to our Department. We found that none were in the position that has been mentioned. We also raised with the Cabinet Office the need to co-ordinate across Government more widely on the issue. We are not aware of any other bodies that need such powers and do not have them. There may be other non-departmental bodies that do not need such powers and do not have them. As I said, we are not aware of any other body that is in this situation, but I am not in a position to give guarantees for other Departments, and it would not be appropriate for me to do so. We tried to examine comparable bodies. For example, we examined the circumstances of English Heritage and found that having been established in 1983, it had an express power to delegate.
We need to be mindful of the warning given by my hon. Friend the Member for Liverpool, Walton that we should not attempt to create work either for lawyers or for legislators. Equally, the issue of the Housing Corporation is significant because, unlike many non-departmental public bodies, it deals in the financial markets and its operations have implications for them. Organisations in such situations are different from other non-departmental bodies, which may not be in engaged in such financial decisions, which have so many wider ramifications. The significant point is that when modernising legislation is introduced we need to ensure that such issues are properly scrutinised.
The provision may also cover the Housing Corporation’s ability to appoint members to the board of an RSL that is causing problems and is under supervision. We would not want those sorts of things challenged in the court by people who are causing problems within the RSL if it is already under supervision and needs to be regulated further in the public interest.
In each of those areas when we have pursued this matter some legal comfort regarding rule changes might be provided by other legislation, for example the Land Registration Act 2002, the Companies Act 1985 and the Industrial and Provident Societies Act 1965. Having looked into that in some detail, we came to the conclusion that there was insufficient certainty in relation to the statutory functions for us to expect the Housing Corporation, the housing associations and their lenders to proceed on the basis of the appropriate comfort needed for future decision-making.
5.15 pm
The hon. Member for Surrey Heath asked whether we could publish our legal advice. We considered that as well because we were keen to be as transparent as possible. As the hon. Gentleman knows, legal advice is covered by legal privilege. There may be challenges in court in advance of the legislation reaching the statute books, and for that reason—and the precedents that would be created—we concluded that it would not be appropriate for us to publish that advice. We did, however, provide a summary of the key points. We relayed the key points to the Council of Mortgage Lenders when it raised this issue, and I am happy for officials to provide further advice to the hon. Gentleman on the issue if he feels that it is important. We made sure that we relayed the principles of the legal advice we received to the House and to the Opposition parties in order to allow proper discussion of the issues.
The third question that the hon. Member for Surrey Heath raised concerned consequences and the relationship between the Housing Corporation and English Partnerships. The hon. Member for Wellingborough also raised the issue and asked whether future legislation would be needed. We should be clear that we have not taken a decision about the relationship between the Housing Corporation and English Partnerships. We are consulting and having a wide debate about that and we have definitely not made any decision yet about the appropriate way forward.
If the two organisations were to merge into a new one, primary legislation would certainly be required, but it would take time to draw up primary legislation and to take decisions about the functions that a new body would have. It would be irresponsible of us to delay the measures in the legislation until such time as decisions were made, especially as it may be the case that no legislation will be introduced, or it may be some time before the legislative opportunity arises. I assure the House that were it to be the case that new legislation created a new body, we would ensure that the express power was included as part of that legislation.
My hon. Friend the Member for Liverpool, Walton raised a point about not searching for non-existent problems. Nevertheless, we have made it clear that we must ensure that all of our non-departmental bodies can function effectively and appropriately. I welcome the support of the hon. Member for North Cornwall for clauses 1 and 2. I agree with him that this is timely legislation which we need to pass in order to address the problem.
The hon. Member for Wellingborough raised a series of questions to which I shall try to respond. He asked whether we could wait longer. As I have already said, it is not appropriate to do so. He said that the Housing Corporation was not panicking so we should not legislate in haste, but he would accuse the corporation of extremely irresponsible behaviour if it started panicking about this issue. The Housing Corporation and its lenders have been very responsible in their approach and part of the reason for the calm and measured tone of their response is that we made it clear to them from an early stage that we wanted to resolve the position and would be prepared to introduce legislation, if necessary, in order to do so. It has proved necessary, and we have responded to their concerns.
Mr. Bone: The Minister just said that the Housing Corporation was aware very early on that the Bill was coming before Parliament. In that case, why were they still pursuing until recently the idea of a general consent under section 9?
Yvette Cooper: As I said, the Housing Corporation first raised the issue with the Department in December last year and we had further discussions and meetings in January and February. We made it clear to the corporation that we wanted to resolve the situation, but also that we needed to explore every other avenue of doing so because it was important not to take up parliamentary time if there were alternative routes. That is why we asked the Housing Corporation to look further at issues around general consents, and we looked at them as well. We have been very clear with the corporation and with the lenders from the beginning that everyone agreed that the situation needed to be resolved to provide a secure basis for and proper certainty around future and retrospective decisions, but that we needed to work out in some detail with it and other stakeholders how we took the matter forward.
The hon. Member for Wellingborough asked whether section 9 decisions could have been covered by the general consents. It is correct that other decisions could not have been covered by general consents, as only section 9 of the Housing Act 1996 on disposal of land provides for general consents. Therefore, we would not have been able to cover some of the other issues around regulation, and regulatory and registration decisions through a general consent.
In addition, the legal advice was that there was no certainty that a retrospective consent to dispose of land would be held by a court to be valid; that even though it might provide some considerable comfort it would not provide legal certainty. On that basis, we thought it appropriate to legislate to provide certainty.
We considered whether section 9 consents were needed at all. In fact, the Elton review considered this and decided that it was not appropriate to remove the requirement for a section 9 consent to be given by the Housing Corporation. One of the issues is that social housing assets are in part funded by the taxpayer. They are a public investment and provide an important public service. Therefore, there are significant questions about the protection of taxpayers’ money and the public interest if housing associations are able to dispose of assets that have been part-funded by public investment and by taxpayers. The hon. Gentleman is welcome to raise the matter as part of a wider debate about the Housing Corporation and English Partnerships. Obviously, it would be more fruitful to discuss that wider question, which has far wider ramifications, in that way rather than trying to debate it within the scope of this Bill, which has a limited purpose.
My hon. Friend the Member for Wallasey and other hon. Members asked what had happened to the lawyers who uncovered the problem in the first place. I am not able to say what has happened to them, to the many lawyers who I presume have been consulted over the decades, or to the officials under this or previous Governments who perhaps failed to consult lawyers when dealing with the issue on previous occasions. Nevertheless, now that we are clear that there is a problem, everyone—lawyers, officials and so on—is working hard to resolve it. My hon. Friend is also right in saying that we should be trying to prevent court challenges and unnecessary litigation in the future.
Finally, a question arose while my hon. Friend was talking about whether registration of RSLs should be done at board level. In fact, the registration of RSLs is done not by officers but by sub-committees, whichis a perfectly sensible approach for the Housing Corporation to take. Obviously, it is for the corporation to decide whether that should be done by the main board or by a sub-committee. The point is that the Bill allows the corporation to take that decision itself, rather than taking everything through the board. I hope that I have responded to every question that was raised on clause 1.
Question put and agreed to.
Clause 1 ordered to stand part of the Bill.
Clause 2 ordered to stand part of the Bill.
Bill to be reported, without amendment.
Committee rose at twenty-four minutes past Five o’clock.
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