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31 Mar 2008 : Column 503

Mr. Wright: That is a difficult one to answer, but I will be open and up front with the House. In the regulatory impact assessment, we say that some 2,500 new council houses will be built on the back of the provisions in the Bill—on an annual basis, I hasten to add. That contrasts with the 250 to 300 houses per annum that we are building at the moment. I think that we are moving on this and that there is not much difference on it between Members in all parts of the House. Councils do play a role, but I suggest, with the greatest respect to the House, that housing associations and other providers also have a key role in helping to lever in private borrowing.

Lembit Öpik rose—

Mr. Wright: I will give way for one last time, and then I want to move on to new clause 1.

Lembit Öpik: The Minister is right to spend time on this, because it is one of the key elements in the Bill. Can he confirm that he believes—he must, I suppose—that if new clauses 1 and 8 are not passed, we will build more houses than we would if they were passed? I remind him that he has not yet addressed amendments Nos. 14 and 15; if he does not do that, I will ask for a separate vote.

Mr. Wright: The hon. Gentleman will therefore forgive me for moving on quickly. I would say that there are two separate issues, because the two new clauses are similar but talk about different things.

On new clause 1, I thank my hon. Friend the Member for Great Grimsby, who has acted as a true champion of ensuring that tenants get good and adequate information. I am very interested in the points that he has raised and I have been listening intently. He mentioned two key points with regard to the introduction of a code of practice, the first of which concerns the objectivity of the information that is provided to tenants. Before I expand on that, I must put it on record that he makes some very good points. I know that from personal and direct experience, because in a former life I was an auditor—I apologise to the House for that—and one of the things that we considered and undertook reviews on was the quality of information provided during large-scale voluntary transfers. At times, the information provided has been slightly one-sided; although in general, it is a good procedure, and most local authorities provide a fair, open, transparent and balanced view of the stock transfer options. However, I accept the point excellently made by my hon. Friend that there is a need for more objectivity, so with his permission I would like to take this issue away and look at it again. I would like Oftenant to have a role in this. I would also like the Homes and Communities Agency to play a role in relation to the information provided and perhaps in having some impact on the funding of such information. I want to look at this closely, and with my hon. Friend’s co-operation and assistance, I hope to do so with a view perhaps to tabling amendments in another place or when the Bill returns here. He has a fair point, and I hope that he accepts that I am very keen to help him.

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Mr. Austin Mitchell: I am most grateful to my hon. Friend; it is good to find that he is listening. He did a good job of defending the indefensible on finance for council housing. However, there are certain points that I would like to reiterate. Now that I have the serried ranks of the Conservative party, the Liberal party and my hon. Friends, including my hon. Friend the Member for Hayes and Harlington (John McDonnell), behind my amendment, I would like to make it clear what we are asking for: a definite date for the ballot so that there is no jiggery-pokery in changing it all around; a fair and balanced debate; extension of the 28 days allowed in the Bill for tenants to raise concerns and ballots for ALMOs as well for large-scale voluntary transfers.

Mr. Wright: Certainly on my hon. Friend’s first two points, I am keen to work with him and think that he has a fair argument. It is right, for example, that tenants should be given sufficient notice of the time when the ballot will be held in order to allow their proposals to be subject to the full consultation that they deserve. I think that I have dealt adequately with the objectivity exercise with regard to information. In terms of requiring the local authority to give adequate notice, again, I am keen to work with him, and others, to deal with that.

The third point is slightly more complex. On tenant ballots, the issue is a change of tenure as opposed to a change in management. Good practice always indicates that tenants should be fully engaged with regard to the change of management. The system works well in the main, but I pledge to my hon. Friend and others that when we look at the renewal of guidance, we might need to look at the issue again. I do not want to impose unnecessary restrictions and burdens on local authorities and others in order to move things forward, but I would like to meet my hon. Friend so that we can find that way forward. I hope that I have given him my clear pledge on the matter, and reassured him so that he can end the unholy alliance he is leading with Her Majesty’s Loyal Opposition.

8 pm

Frank Dobson (Holborn and St. Pancras) (Lab): I am sure that everyone welcomes the idea of free and fair elections—not just in Zimbabwe, but in the ballots we are talking about. I welcome what my hon. Friend the Minister has suggested, but if at the end of the process tenants vote to stay with the council, we are saying, “So what? You won’t get any money to do up your housing.” That has been the problem all along. In Camden, the council did its level best to get tenants to vote for the ALMO, but 77 per cent. of tenants and 77 per cent. of the leaseholders voted against. People are left in a position where a Labour Government are refusing to find any money to do up housing. The council is now selling the most attractive individual houses on the streets to raise money in order to do up a small part of the rest of the estate.

Mr. Wright: I disagree slightly with my right hon. Friend about that because all local authorities now have a clear road map on achieving decent home standards, regardless of management or ownership of the property. I know that Camden is a special case and
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that my right hon. Friend has worked hard in that instance, but the roles are clear. I reiterate this point: far from being starved of funds, there has been a 30 per cent. increase in the amount of council funding from central Government. Private borrowing can be levered in so that more can be done more quickly. I was on a local authority when we had a large-scale voluntary transfer, and in many respects the problems of housing demand were exacerbated, because my registered social landlord, Housing Hartlepool, has been so successful that people who did not deal with it previously now want to move into a social landlord property. The problem of demand has been exacerbated, and we need to address it by building more homes. I want to reiterate my central message, and the central point of the Bill, which is that we need more homes of all different types.

I shall move on to the other points made in the debate, particularly those made by the hon. Gentleman for—is it North Bermondsey and Southwark?

Simon Hughes: North Southwark and Bermondsey.

Mr. Wright: Never mind.

On new clause 29, I agree with the hon. Gentleman that sinking funds are a sensible idea to help leaseholders spread contributions over the longer term and to help to avoid high, one-off costs for capital works. I have worked with my hon. Friends the Member for Regent's Park and Kensington, North (Ms Buck) and the Member for Islington, South and Finsbury (Emily Thornberry) on this matter, and I am keen to make sure that we can help as much as possible.

I suggest to the hon. Gentleman, however, that the provision is unnecessary because councils already have the ability in question, where leases allow. We are aware of the practical obstacles that prevent that process from happening in practice, and it is currently difficult for a local authority to contribute to the sinking fund the precise amount that would represent the sums payable by non-leaseholders—the so-called tenant’s proportion. The local authority’s contribution on behalf of the tenants would be needed to ensure that the fund was adequately resourced to meet the full cost of any such works and to provide the necessary clarity and transparency with regard to its real value. Earlier sinking funds lapsed largely because leaseholders were reluctant to make contributions when works were not carried out—often because of a lack of resources. It has also been difficult to set contributions that balanced the need for affordability and the need to be realistic in meeting the costs of works.

Jeremy Corbyn (Islington, North) (Lab): I thank the Minister for giving way, and for the meeting that he held with a number of colleagues concerning this matter. Does the legislation, which he supports, allow local authorities to conduct a case-by-case analysis of the needs of leaseholders when major works are done? Like every other Member of this House, I have many poor constituents, who bought their properties under right to buy in the 1980s and simply cannot afford the requirements for the capital costs of new roofs and so on. We need a degree of flexibility when dealing with this matter.

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Mr. Wright: My hon. Friend makes an important point and during my time in the Department I have tried to deal with the need for local authorities to be flexible. That is provided for in the Bill, and it went through Committee relatively successfully. Authorities should provide things such as equity loans and equity shares in order to have flexibility with regard to circumstances on the ground and should consider how best to address the concerns that my hon. Friend raises. In the meeting I had with him, he eloquently talked about the concerns of the more vulnerable people in his constituency and others. How do we deal with that issue? I do not want to suggest that the housing revenue account subsidy review will solve all of the world’s problems, but in the wider context, it will consider how we balance affordability and realism in order to ensure that we have sinking funds and that the capital costs of service charges are dealt with.

Simon Hughes: I am grateful for the Minister’s considered response, but the problem is that some leases do not allow for sinking funds. We need legislation to change to allow them for every lease, even if, originally, the terms of such leases did not allow for such a fund. Before the Bill is looked at in detail at the other end of the building, I hope that I can persuade the Minister that we might find a common formula that would allow every lease to have a sinking fund, which could be used by the local authority and the leaseholder.

Mr. Wright: I would certainly be happy to look at the matter on that basis because I am keen to ensure that we do something about it. I am concerned that in the constituencies of my hon. Friends the Member for Islington, North (Jeremy Corbyn) and the Member for Regent's Park and Kensington, North, people are suffering—often the most vulnerable in society, for whom we need to do more—because of that problem. The provisions in the Bill help with that process as much as possible, and they help local authorities to provide flexible consideration on the ground, dictated by local circumstances. I take the point about existing leases, and I would be happy to meet the hon. Member for North Southwark and Bermondsey (Simon Hughes) to discuss it.

On the hon. Gentleman’s new clause 31, we all agree that leaseholders should have a fair deal when it comes to service charges, but we want to ensure that they contribute their fair share to those charges. That is why we have put in a place a system of safeguards and measures that make people aware of what they are taking on when they buy a leasehold property and that involve them in decisions about works to their property. Provisions in the Landlord and Tenant Act 1985, which were amended by the Commonhold and Leasehold Reform Act 2002, already cover much of what is proposed by the hon. Member for North Southwark and Bermondsey. As the House will be aware, there are statutory requirements for all landlords, including those in the local authority and the social sector, to consult their leaseholders before carrying out works in their buildings and estates. Those requirements cover much of what is proposed in the new clause, including the requirement for landlords to give reasons for works, to provide details of works to leaseholders, to have regard to tenants’ observations, and to obtain nominations for potential contractors. On that basis, I suggest that the new clause is not necessary.

31 Mar 2008 : Column 507

Amendment No. 145, which would amend section 105 of the Housing Act 1985, would introduce a duty for local authorities to seek the views of secure tenants when the Secretary of State was conducting a public consultation on housing management where a response was made by the authority. The amendment would require landlords to consult tenants on all national Government consultations that affect them when the landlord intends to respond. From the face of the hon. Member for North Southwark and Bermondsey, he appears to agree with me that that is unnecessary and an unmanageable burden, without any real benefits to tenants, especially given that we already have excellent and effective consultation procedures nationally. I therefore hope that the hon. Gentleman will not press that amendment.

Let me deal with amendments Nos. 14 and 15, which the hon. Member for Montgomeryshire (Lembit Öpik) tabled. I want to consider Government amendments Nos. 40 to 43 at the same time because I believe that our amendments, especially amendments Nos. 40 and 42, would achieve the same thing. Government amendments Nos. 40 to 43 are designed to do three things. First, they would ensure that, when a landlord or tenant makes a request to the district valuer for a review of his valuation of a property for right-to-buy purposes, the request and the reason supporting it should be in writing.

Secondly, the amendments would clarify that the determination of value can be reviewed only if the sale has not been completed. I suggest that that is almost exactly the same as amendments Nos. 14 and 15, which reflect a suggestion, as the hon. Gentleman eloquently pointed out, that London Councils made. I am glad that we can all agree on that sensible suggestion.

Thirdly, our amendments are designed to ensure that, in the review process, which clause 290 introduces, the district valuer knows the date from which specified time limits are calculated. Clause 290 will allow district valuers to withdraw determinations of value and make new ones if they decide that their original valuation was factually flawed, acting either on their initiative or in response to a request from the landlord or the tenant. The aim is to make the right-to-buy valuation procedure more responsive to particular circumstances. At present, wrong valuations based on errors of fact cannot be corrected without court action. On that basis, I hope that the hon. Gentleman will—

Lembit Öpik: To finish the sentence, “not press the amendments.” I would love to comply, but I want clarification of some practical matters. The Under-Secretary says that Government amendments Nos. 40 and 42 would achieve the same outcome as amendments Nos. 14 and 15. That means that he believes explicitly that it would not be possible to reopen the question of the valuation from the point of completing a right-to-buy purchase. First, is he saying that that is the case? Secondly, exactly which part of the amendments makes that case?

Mr. Wright: The hon. Gentleman makes a good point. I agree that it would be undesirable if a landlord or tenant challenged the agreed price of the property
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after completion or if a district valuer could decide on his own initiative to review the valuation after completion. Once a property has been sold, that should be that.

I hope that the hon. Gentleman agrees that flawed valuations are unfair. If they are too high, the tenant needs an unnecessarily high mortgage—we have been discussing credit crunch and restrictions on mortgages this afternoon—or may be unable to afford to buy. Valuations that are too low mean that the landlord and the taxpayer receive a lower receipt than is justified.

In response to the hon. Gentleman, I suggest that clause 290 aims to ensure that such issues can be resolved flexibly. The Government amendments are designed to ensure that the district valuer has the necessary information to enable that to happen as expeditiously as possible. I therefore hope that hon. Members will accept Government amendments Nos. 40 to 43 and that the hon. Gentleman will not press amendments Nos. 14 and 15, on the basis that our amendments achieve what he wants.

Lembit Öpik: I offer the Under-Secretary a deal—I am not playing games with him. I do not believe that the Government amendments do what he set out. If, on the basis of impartial legal advice after the debate, the amendments do not achieve what he says, will he commit to introducing a statutory instrument to achieve what amendments Nos. 14 and 15 propose? If he is willing to do that, and, acting in good faith on the basis of legal advice, which we do not have the time or resources to seek now, to try to achieve something that we both agree should happen—I am not persuaded that the Government amendments achieve it—I will not press the amendments to a vote.

Mr. Wright: I am keen to reassure the hon. Gentleman. I reserve the right to consider the matter as flexibly as possible, but he has suggested a sensible approach which I am keen to go away and examine. On that basis, I hope that he will not press his amendments.

Lembit Öpik: I understand that the Under-Secretary is saying that we will have a statutory instrument Committee, if, on the basis of an impartial conversation with lawyers and probably London Councils, we decide that the Government amendments do not achieve what he said. I am grateful for that assurance—the Under-Secretary has taken a mature approach. On that basis, I will not press the amendments to a Division.

Mr. Wright: I am grateful for that. The approach reflects the way in which the hon. Gentleman worked in Committee. He was sensible and reasonable and I pay tribute to him for that.

I have made the Government’s position clear on the important group of amendments that we are considering. On the key central elements of the amendments, I hope that I have reiterated my view and the Government’s policy that council housing, especially new build, is essential to help address genuine housing needs.

Alistair Burt: Will the Under-Secretary give way?

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Mr. Wright: I will, but let me say how disappointed I am to see the hon. Gentleman on the Back Benches rather than being excellent on the Front Bench, as he was in Committee.

8.15 pm

Alistair Burt: I am grateful to the Under-Secretary for that kind remark. It is now quarter past eight and we have been discussing the first group of amendments for about four hours. There has been no time wasting. With five more substantial groups of amendments to cover, not enough time has been allocated. Before he sits down, will he tell the House that he will not press the matter to a conclusion with the end of Report and Third Reading but sort out more time with the usual channels? Does he appreciate how welcome that would be to the House? He must be as worried as anyone about the fact that we cannot deal with a substantial range of amendments in the way I know he would wish.

Mr. Wright: The hon. Gentleman makes an important point. I hope he acknowledges that I have been keen throughout our deliberations for hon. Members to have the opportunity to raise appropriately all points and concerns. On his specific point about the usual channels, with the greatest respect, that is above my pay grade. I am keen to ensure that the Bill receives the proper scrutiny that it deserves. However, Her Majesty’s loyal Opposition cannot have it all ways. On Europe—

Mr. Deputy Speaker (Sir Michael Lord): Order. I have been fairly tolerant for a little while. Perhaps the Under-Secretary should now return to the new clause.

Mr. Wright: Thank you for your guidance, Mr. Deputy Speaker.

I hope that I have made the Government’s position clear and that we have responded to concerns. I hope that my hon. Friend the Member for Great Grimsby, who tabled amendment No. 5 and new clause 1, is reassured that I am keen to address his concerns.

On that basis, I hope that hon. Members will accept the Government amendments and not press their own.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

New Clause 12

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