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Mr. Hutton: We have no plans to grab any money in the way that the hon. Gentleman suggests. This exercise is not designed to reduce spending; quite the opposite. As I said earlier, I am prepared to invest more in the
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business to give disabled people the prospects and choices to which my hon. Friend the Member for Kingswood (Roger Berry) referred.

I welcome the general support of the hon. Member for Dundee, East (Stewart Hosie) for the package that has been made available to disabled employees. Of course the accrued entitlements of Remploy’s able-bodied employees under the final salary pension scheme will be fully observed by the company. However, the same offer could not be made to able-bodied employees as has been made by the company to its disabled employees. The company has made the choice—the right one, I think—that the proper and effective way to discharge its responsibilities and duty of care is the one that it has outlined today. That is the right way forward.

Angela Eagle (Wallasey) (Lab): I too welcome in principle the move, which has to be right, of those with disabilities into mainstream employment—but the Central Cutting unit at Birkenhead, which is to be merged, where I have constituents working, is devastated by the news today. Can my right hon. Friend confirm on the record once more what we were told in a briefing earlier by the chairman of the company: that all the existing work force will be guaranteed their terms and conditions, and access to the pension fund, and that level of support in any employment that they undertake in the future, for the whole of their employment life? “For life” was what the chair said to us when we met him earlier today. Can my right hon. Friend confirm that that is indeed the case?

Mr. Hutton: I am grateful to my hon. Friend. I want to emphasise two things. She referred to the Remploy factory in her constituency merging. That is the proposal; a final set of decisions has not yet been made by the company’s board, and that will not happen until later this year. There is therefore the opportunity for her constituents and herself to be involved in helping to shape the final proposals that the board bring forward to Ministers. I am very happy to make it absolutely clear again that what the chairman of Remploy, Ian Russell, said today is the company’s position—that there is an absolute guarantee along the lines that he indicated to my hon. Friend earlier in the day, and that that undertaking will be honoured.

Mr. Dennis Skinner (Bolsover) (Lab): The Secretary of State has used the words “sensitive” and “sensitivity” several times, and the company has been careful to try to get that message across. Will he continue that theme, bearing in mind that there are quite a number of these closures in the old pit areas, where unemployment is still a problem? There is one in my constituency, there is also one five miles away in Mansfield, and there was a closure a few years ago nearby. So will the Secretary of State look sensitively at that, as the operation has not been completed? And will he not keep referring to that £20,000 cost for each Remploy employee, because there are a lot of people in Britain that cost £20,000 to employ? In fact, there are some down in the sheltered accommodation at Buckingham palace who would all be put out to grass.

Mr. Hutton: In relation to my hon. Friend’s most important point, I reassure him that the company has already looked at those issues very carefully, and it will
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have to take them into account in making its final proposals. There is one overwhelming obligation now; that is clear from what the chairman of Remploy said today. The company must honour the guarantee of no compulsory redundancies. If that cannot be done for the list of factories currently scheduled for closure, the company will have to come forward with alternative proposals. I hope that my hon. Friend will not mind if I do not get drawn on the last point that he made.

Mr. Chris Mullin (Sunderland, South) (Lab): I think that we will all agree that what my right hon. Friend proposes is sensible in theory, but we will all take a close interest in how it works in practice. I was glad to hear him say repeatedly that he would take account of local economic conditions—although when we hear that factories in, for example, Aberdare are to close, we do wonder how far they have been taken into account.

Is not the danger that when we help people into mainstream employment, they will remain in it for as long as the subsidy to the employer continues, and as soon as that subsidy ceases they will not be in it any more? Does my right hon. Friend have any long-term research on how long people who have already been helped into jobs have remained in them?

Mr. Hutton: I shall certainly make available all the research information that the Department currently has. The guarantee from the company is to support employment for the rest of a person’s working life. It is inevitable, I suspect, that there will be occasions when a period of mainstream employment may come to an end, but the company’s job and obligation there is to help the person find alternative work, and throughout that time that person will be employed by Remploy, on Remploy terms and conditions. I genuinely think that that is a very extensive offer of help and support.

I agree with my hon. Friend in one very important respect: I think we should all reserve our judgment until the final proposals have come through. I am willing and available, as is the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Stirling (Mrs. McGuire), who is the Minister with responsibility for disabled people, to meet any hon. Member to discuss their concerns and how we can best take forward this sensitive matter, which is important to all of us.

Mrs. Linda Riordan (Halifax) (Lab/Co-op): I was at the Halifax factory yesterday morning, and I am disappointed and angry at the news today, especially for the dedicated and hard-working staff there. Will the Secretary of State outline to the House why the Halifax factory has merited the proposed closure? What will be done to find suitable alternative employment for the staff, particularly considering the area we are in, and the proposed closure of the two Remploy factories nearest to Halifax—those in Barnsley and Bradford?

Mr. Hutton: Again, I understand my hon. Friend’s point, but I want to make something clear to her. She has, I think, assumed—wrongly—that the Halifax factory is going to close, but whether that is so will be clear only when the final proposals have come through. If she and her constituents believe that there are strong
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arguments against the closure of the Halifax factory, I know that the board of Remploy will fully consider them.

Clive Efford (Eltham) (Lab): May I stress to my right hon. Friend the Secretary of State that the consultation must be genuine? I cannot imagine how the workers at my local factory must be feeling, having heard the recommendation that their workplace should close. My concern is that the recommendations are being made before Remploy has had the opportunity to prove that it can find places in mainstream workplaces for current Remploy employees. I think that that will be an extremely difficult task.

May I suggest that there is a way forward that has not been put forward by Remploy or been considered in enough detail? It is that Remploy factories could provide a training base—a stepping stone—for people with disabilities who are trying to go back into mainstream work. Although it is important that people have dignity in the workplace and should be supported in mainstream employment, there is undoubtedly an element of the Remploy work force that cannot be employed in any other setting. Getting rid of these unique workplaces, where people can have dignity and be safely employed, will be a retrograde step. We will not be able to recreate them. We need to consider innovative ways to use Remploy factories in a new form, to meet all the needs of the work force for whom we are trying to provide a service.

Mr. Hutton: My hon. Friend’s last point has not been discounted by the company. I think it remains very much one of the options. I am sure that he and others will put that case to the Remploy board in the next three months or so, and I am prepared to act as interlocutor on his behalf if he feels that that would be helpful.

On my hon. Friend’s first question—about whether we should be confident of our ability to find alternative employment—it is worth reminding ourselves that Remploy currently has 1,500 vacancies on its books to help disabled people to get employment in mainstream employment situations. We are therefore entitled to be reasonably confident that we will be able to provide alternative employment. However, I accept absolutely—it is baked into the Remploy proposals—the need for sheltered employment in future. No one is proposing that disabled people should have no choice. The express purpose of the reforms is to give disabled people more choice.

Mr. Doug Henderson (Newcastle upon Tyne, North) (Lab): My right hon. Friend will know that the trade unions have been calling for diversification and change in Remploy, because they could see what was coming. It seems to me that they have shown a lot more perspicacity than, historically, the management of Remploy have shown. If this is solely in the hands of Remploy, I have no great confidence that a plan will be brought forward in the consultation that will lead to security of employment in future. I think that a fund for change and modernisation is available. Is my right hon. Friend prepared to use that fund during the consultation period to explore the possibilities of establishing new employers with new
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products and new marketing schemes that could provide better long-term stable employment for those people, still secured under the terms and conditions that are broadly available at Remploy?

Mr. Hutton: I did indicate in my statement that we were prepared to put additional resources into the business if that would help to sustain the factory network, or in fact the company, in future. As for my hon. Friend’s point about the board, there is a new chairman who has handled himself exceptionally well in the last few months, and who has begun to build good relationships with the work force and the trade unions. Notwithstanding the disappointment that many will feel, now that there is a plan, it is important that we take advantage of it to help to shape and mould the company, so that it can help to meet the priorities that he and I share. Those priorities are the need to provide choice, opportunities, and the dignity of proper, effective, meaningful employment for more disabled people. We will not be able to do that without reform. I do not believe that we can do all the things that he and I want to do if we simply carry on as we are. That would let down many disabled people in the long term, and it would not give disabled people and their families some of the things that he and I want for them.

Mr. Denis Murphy (Wansbeck) (Lab): May I first express my serious concern about the proposed closure of the Ashington factory in my constituency, which is at the heart of one of the areas of greatest unemployment in Northumberland? Indeed, the Remploy factory is the only factory in Northumberland. The work force were informed of the closure; they were told that the factory would close by the end of the year, and that is contrary to the spirit in which my right hon. Friend made his statement. Will he comment on that, and on the statement made today by Ian Russell, the chairman of Remploy, who said that no factory would close until suitable alternative employment was found for all those affected?

Mr. Hutton: I cannot explain how it came about that my hon. Friend’s constituents were told what they were told. Clearly, it is flatly contradicted by what the chairman of Remploy said. I simply urge my hon. Friend’s constituents to listen to the chairman of the board, and not to what they have been told by others.

Andrew Gwynne (Denton and Reddish) (Lab): Seventy-seven people are employed at the Remploy factory in Stockport, which is based in Heaton Chapel in my constituency, and 74 of them are disabled. They will be offered opportunities for employment at the Oldham Remploy factory, but will my right hon. Friend explain how they will be offered support in accessing those job opportunities, as that is obviously crucial to them?

Mr. Hutton: That will ultimately be a matter for the company to decide, assuming that the proposals are implemented as they are currently formulated. If that were to happen, clearly it would be incumbent on the company to find a way of making sure that my hon. Friend’s constituents were able to work at Oldham. If that means providing help with transport and other costs involved in the move, the company will do that.

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Mr. Jim McGovern (Dundee, West) (Lab): Like the hon. Member for Dundee, East (Stewart Hosie), I am delighted to hear that the Dundee Remploy factory will remain open. However, I have some concerns about Dundee, and other places. Will the Secretary of State confirm that factories for which closure is not proposed will remain unaffected by the plan? He says that the terms of transfer will go beyond the Transfer of Undertakings (Protection of Employment) Regulations 1981; will he confirm that, at the very least, TUPE will apply, so that if, five years down the line, the Remploy factories that remain open offer a beneficial 50 per cent. wage increase, it will apply to all former Remploy employees, regardless of how long ago they left and where they are employed at the time?

Mr. Hutton: Yes, I can confirm that the offer from the company is to maintain people’s existing Remploy terms and conditions, and it is under those terms and conditions, whatever they are, that people will be employed in future. I am grateful to my hon. Friend for his opening remarks; I am glad that a way forward has been found, and that the company does not propose to close Remploy in his constituency. Clearly, some of the factories that are to stay open will be affected by the closures, because employees will be transferred to them, but I can only repeat what I said earlier: we are talking about the company’s initial set of proposals, and we have to find a way to secure the long-term future of Remploy as a business. By that I mean its future as a provider of sheltered employment and as a provider of mainstream employment opportunities for disabled people. That is very much what the board wants, and what my hon. Friends and I want.

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Houses in Multiple Occupation

4.54 pm

Dr. Alan Whitehead (Southampton, Test) (Lab): I beg to move,

Right hon. and hon. Members will be familiar with the housing landscape in many of our towns and cities, where parts of those towns have become areas where the house in multiple occupation is the predominant form of housing. In many instances those houses are not what one might call traditional HMOs—an original large house subdivided into flats—but are a single house remaining as such, occupied by perhaps half a dozen people paying rent for their individual occupation of an otherwise unconverted house.

This is particularly the case in towns and cities where there are substantial numbers of students. With the expansion of higher education over the past two decades, there are many such towns. The city that I represent, Southampton, is one of those, with an estimated population of 28,000 students in a city of about 220,000 people. It is a city that I represent along with my right hon. Friend the Member for Southampton, Itchen (Mr. Denham), the former president of the students union. Although university authorities have built increasing numbers of halls of residence and student flats, the majority of students live in such HMOs, under one roof, sharing facilities and, according to a court ruling of 1995 in the Barnes v. Sheffield case, living as a single household.

It is right that a range of types of accommodation should be available to people. HMOs of various types provide important accommodation for young people, single people and people who are seeking shorter-term accommodation. The difficulty that local authorities face in considering how the different types of housing stock are to be deployed is that most types of stock—flats and small or larger houses—and changes of use of building from commercial to residential are all subject to the local planning regime, whereas the conversion of houses from family occupation to multiple occupation is not.

Under present planning legislation, a landlord can simply purchase a family house, possibly with a buy-to-let mortgage, and place five or six tenants in the house immediately. Cumulatively, such HMOs have a substantial impact on the character and amenity of neighbourhoods and, over and above the self-sustaining market that they create, on the inability of families to purchase houses where “studentification” has taken hold, because of the power of purchase that such landlords hold. HMOs raise all the issues of transient tenancies, of large numbers of extra cars parked, and possibly of noise. In short, the area becomes quite different in character.

Despite the fact that HMOs are a specific kind of housing, they are the only kind that is effectively beyond the reach of local planning arrangements. That is because under present planning law, dwelling-houses are regarded as one kind of use, and are so defined in the use class orders that derive from planning legislation. According to the use class orders, with
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minor but important exceptions a dwelling-house is a dwelling-house is a dwelling-house, regardless of who occupies it. That is understandable in planning terms, as planning law is blind to occupants, and is concerned with land use and its effects.

To an extent, planning law acknowledges that multiple occupancy of a house has land use consequences, but the use class order effectively exempts a change of use within the class for a house with up to seven occupants. A very large HMO, therefore, can come under local planning scrutiny, but the vast bulk of HMOs do not have seven occupants, so the distinction is pretty redundant.

Housing law has moved to recognise the reality of houses in multiple occupation. As right hon. and hon. Members know, the Housing Act 2004 established extensive procedures whereby local authorities can register HMOs and license landlords to run them. The qualifying point for general registration under the Housing Act is five occupants living in a three-storey house, although more widespread registration schemes may be introduced with the agreement of the Secretary of State.

That is a welcome change. As it is implemented, it delivers the prospect of HMOs that are better managed, and the revocation of licences for landlords where such management consistently falls below a level acceptable to local communities. However, it does nothing about HMOs becoming HMOs in the first place. Furthermore, it introduces two different regimes for the definition of HMOs. The Housing Act, for example, specifically includes student houses in its definition of HMOs, because it defines an HMO as a dwelling in which a number of people not related to each other live under one roof. That, in turn, entails a definition of a family and what it means, in housing terms, to be related. Nevertheless, the Act encompasses the reality of HMOs in a way that planning law does not.

What is to be done? The title of my Bill indicates what should be done: the process of effectively changing the use of a family house to that of an HMO, whether that happens through the purchase of a previously occupied house or, as is becoming increasingly common, through the purchase of a new property for buy-to-let purposes, should be regulated through the local development and planning process.

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