Housing and Regeneration Bill

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Clause 27

Power to charge for certain activities
Question proposed, That the clause stand part of the Bill.
Mr. Raynsford: Clause 27 covers the power of the HCA to charge for certain activities. It is obviously appropriate that, where the agency provides services and research, there should be the capacity to make a reasonable charge for that. Indeed, I understand that the existing bodies, the Housing Corporation and English Partnerships, currently do that. My concern is that the power as defined in the clause, certainly in subsection (1), appears to be limited to anything done by virtue of clauses 41, 42 and 47. Clause 42 covers training and advisory services and it looks sensible and straightforward.
Clause 47 needs closer examination because it states that:
“The HCA may provide services in support of a project.”
It defines those services as seconding staff; providing consultants or other manpower resources to a project, or; lending or providing technical, property or other resources. That is all fine in theory, but what is the definition of “a project”? Could that be unduly restrictive? Does a project refer simply to a single housing scheme supported by the new agency, following on from the ability of the Housing Corporation to provide funding for a particular housing scheme, or does it go wider? Could it cover new regeneration initiatives that perhaps will apply in a number of different areas or projects—I am using the plural—that will have different outcomes in different parts of the country? Might that fall foul of a definition that appears to be limited to anything that is done in support of “a project”? I do not know the answer.
I am puzzled by that matter and slightly worried that when we see the agency operating, the definition of “a project” might unduly restrict its ability to offer technical support, consultancy, advice and other assistance to enable worthwhile regeneration or other initiatives to take place. We might all support and regard them as sensible and admirable activities, but they might be prevented if the definition of
“in support of a project”
proves unduly restrictive. I am simply seeking guidance on whether that definition provides for the full range of circumstances in which it would be appropriate for the HCA to provide support and to charge for it in order to defray the costs.
Mr. Wright: Personally, I think that the clause is important because it empowers the HCA to charge. In doing so, we get a bit of a sneak peek into what it will do and how it will help local authorities and others to step up to the plate. I would like to refer you to the objects of the HCA, Mr. Benton. It is tasked with supporting
“in other ways the creation, regeneration or development of communities in England or their continued well-being”.
It will do that by working with local authorities and other stakeholders by being an expert delivery partner. The expertise and experience that already exist within English Partnerships and the Housing Corporation will transfer to the agency. That means that the new agency has the potential to be incredibly innovative in the way in which it takes regeneration forward. That could be in providing advice, training and consultancy services to drive forward projects that otherwise would never get off the ground.
Additionally, something that I am interested in and that we do not talk about often enough is the Academy for Sustainable Communities, which will go into the agency and effectively act as an operating arm of the HCA. That will carry forward its work to improve the skills, knowledge and behaviours that are needed to deliver and to maintain sustainable communities. The power in the clause will enable the academy, and then the agency, to charge for the information, advice, education and training support services that they provide.
The clause is intended to enable the HCA not to make a profit from providing those services, but to make reasonable charges to recover the costs that it incurs as a result of providing advice or operating a particular service. It would be unreasonable to require the agency to provide such services without allowing it to recover costs, where it considers it to be appropriate. If the agency were to provide these types of services free of charge, it could lead to it being exploited. We do not want that to happen. It was suggested earlier that we do not want private sector developers and others to see this as a green light and a cash cow. We believe that the agency should be able to make a reasonable charge for those services. That is only right and fair.
I want to come on to an intriguing point that my right hon. Friend the Member for Greenwich and Woolwich made with regard to the power to charge under clause 47, and the reference to “project”. We may return to that matter when we consider clause 47, but my understanding is that the word “project” is used to suggest a time-limited involvement. To remove that word may suggest that the HCA would be involved indefinitely, and that is not the best use of resources. The intention—this will be true for a range of things that the agency does—is that the agency will provide support to schemes to enable them to get to a position where they are either complete or self-sufficient. The duration of that will vary quite widely depending on the scheme, but “project” is deliberately not defined, so as to ensure that it has its natural meaning, which suggests a time-limited span with particular outcomes.
Mr. Raynsford: I accept the point about the time-limited nature of “project”, but I was also asking about geographical spread, because a “project” could be interpreted as referring only to a particular area. If there were an initiative that involved projects in several different areas which depended on an input of consultancy from the agency, and that were interpreted as going beyond the remit because it was not a single project, but a series of projects in different areas, might that be a problem? I ask only because I want to be quite certain that this will not prove unduly restrictive as an interpretation. I entirely accept all the points my hon. Friend has made, but I would ask him to give a little further thought to the question of geographic spread, and to whether a number of different projects might fall foul of the definition.
Mr. Wright: Let me look at that matter again, because my right hon. Friend makes an important point. We had an interesting debate on Thursday on community land trusts. I imagine that he agrees that community land trusts’ expertise would be disseminated to relevant local authorities. I certainly see that as being within the clause. Let me look at the matter afresh. We may come back to it shortly when we deal with clause 47.
Margaret Moran (Luton, South) (Lab): When my hon. Friend reviews the measure, can he look at its scope? The Centre for Research and Market Intelligence is the research and innovation part of the Housing Corporation and I assume that it will be subsumed by the new agency. It deals with some innovative work. It has done work around procurement and around best practice in equalities, for example, which is not project-specific, but more wide-ranging. It is leading edge in terms of best practice, which I know my hon. Friend will want to see from the new agency. I am a little concerned that the wording here may be a little restrictive and may inhibit that kind of best practice project from going forward.
Mr. Wright: I appreciate the comments of my hon. Friend. I think that she agrees that one of the things that we want to see is the dissemination of good practice. The agency will be a repository of that, and I do not want to see anything within the Bill to prevent that from happening. I ask her and my right hon. Friend the Member for Greenwich and Woolwich to let me look at the matter again. I am fairly confident that, with the definition of “project” as it is, that would be allowed to happen. One of the arguments that has been teased out of the Conservative party is, and I paraphrase, that they do not want homes, and one of the reasons they do not want homes is that we do not have the relevant infrastructure. I suggest that dissemination of good practice would be the bread and butter of what the agency will be doing, working in conjunction with local authorities. I reiterate that I do not want anything that would compromise that within the Bill. I hope that we can come back to that during consideration of clause 47.
Question put and agreed to.
Clause 27 ordered to stand part of the Bill.
Clause 28 ordered to stand part of the Bill.

Clause 29

Duty to act as agent in respect of regeneration and development
Question proposed, That the clause stand part of the Bill.
Alistair Burt: I have a couple of questions in relation to the next two clauses. First, will the Minister say in what circumstances the Secretary of State will appoint the HCA to act as agent in the manner described in clause 29?
Secondly, when talking of the HCA’s power as agent of the Secretary of State on matters of regeneration, I wish to raise a particular issue. I understand that the Housing Corporation does not provide finance to schemes in which there is no net increase in affordable housing. In areas that have the potential to increase housing supply and that already have an over-concentration of council housing, making a more mixed community would involve a net loss of council housing. Although it would result in a much more balanced community, which is the desire set out in the Green Paper, such a scheme would not attract financial support.
Will the Minister say whether the HCA might take a more flexible approach? I am talking of a situation in which there was not necessarily a net increase in affordable housing. Would it still be possible for financial assistance to be given to a scheme whose objects were within the terms of the HCA’s remit—within its wider powers over regeneration, rather than simply its powers to act as an agency to deliver more housing units?
How will the HCA use its powers, and will it be more flexible than the current provisions as they affect the Housing Corporation? I should be grateful if the Minister gave us some indication on that.
Mr. Syms: I, too, would like a little clarification on clause 29. I may be wrong, but it seems that the Secretary of State can give the agency a role—for instance, to dispense grants. Does that mean that grants that would now be given directly to local authorities will go to the agency to be dispensed? As someone who spent 14 years in local government, my concern is that it should not be used to get around directly funding local authorities or boroughs.
Mr. Wright: Let me provide some clarity. Sections 126 to 128 of the Housing Grants, Construction and Regeneration Act 1996 give the Secretary of State the power to give financial assistance in respect of expenditure on activities that contribute to the regeneration or development of an area. In simple terms, that means that the agency can step into the shoes of the Secretary of State and give financial assistance in support of regeneration or development activities in particular areas; it is appointed as an agent by the Secretary of State.
However—I return to this point time and again—the agency must act in accordance with the terms and conditions of its appointment, as set out by the Secretary of State, and crucially it will still need to act within the confines of its objects as stated in clause 2. In practice, the agency will be enabled to administer regeneration funding programmes, which are currently delivered by the Department for Communities and Local Government. The power will enable the Secretary of State to appoint the Homes and Communities Agency to perform a number of functions that are currently performed by the Department.
On Thursday, we had a debate about the vision of the Department and it providing a strategic role on what is needed in respect of housing and regeneration, with the HCA being one of the delivery agents. Many of the delivery functions currently performed by the Department are being transferred to the agency. We are doing something similar in clause 19 in order to build on that. The Government believe that it is vital that investors have clarity on the arrangements for delivering those commitments, and I hope that we have provided that clarity.
I hope that I have provided some certainty for the hon. Member for North-East Bedfordshire—but he looks slightly confused.
Alistair Burt: I just want an answer on the points about the flexibility of finance and about the Housing Corporation not funding schemes in circumstances in which there is no net increase in affordable housing. Will the new agency take a different view on that?
Mr. Wright: I am furiously looking for clause 2.
Alistair Burt: Some inspiration is needed.
Mr. Wright: No; I am fairly happy with the inspiration here, although I could now be contradicted. Clause 2 states that the objects of the HCA are:
“to improve the supply and quality of housing in England...to secure the regeneration or development of land or infrastructure in England...and to support in other ways the creation, regeneration or development of communities in England or their continued well-being.”
Those objects are important, and the hon. Gentleman’s points would satisfy those criteria.
6.30 pm
Alistair Burt: May I understand that the Minister is answering “Yes,” and that he does not expect the current restriction operating through the Housing Corporation to continue under the new agency in the specific circumstances that I mentioned? If so, I am happy to hear that. As my point is very specific, I am perfectly content if he wants to write to the Committee. I do not know where his inspiration is leading him at the moment.
Mr. Wright: I understand that I am intervening on the hon. Gentleman, Mr. Benton. Will he clarify the particular circumstances that he means? He mentioned affordable housing and the housing market renewal area; which particular areas is he concerned about and what would he like me to clarify?
The Government’s Green Paper supports the development of more mixed communities, but money is not available through the Housing Corporation if a point of principle on affordable homes is breached. The thinking is, “There will be fewer affordable homes, so how can we give money to this?” If the Government’s aims and objectives were slightly broader than simply building more homes and units, which is the charge that has been levelled against the agency, and if there were an allowance to supply finance to that sort of scheme if a more balanced community were being created, even though there would be a net loss of affordable homes, would that restriction be lifted?
Mr. Wright: That helps an awful lot and clarifies the question. The agency’s objects are wider than the Housing Corporation’s, and I do not want to pass judgment regarding the circumstances that the hon. Gentleman mentions. I mentioned the housing market renewal area because I have ministerial responsibility for it, and I have been to your constituency to have a look around, Mr. Benton, and really enjoyed my time there. A relevant consideration might be an over-preponderance of two-up, two-downs and that we need to lower the density. In such circumstances, that would be entirely reasonable. However, the whole objective is to improve the supply and quality of housing in England. I hope that I have reassured the hon. Gentleman.
The housing market renewal area and possible phased and planned demolitions are a good example of how we need to improve the housing stock. That might mean fewer houses in that particular area; in that respect, I agree with the hon. Gentleman. I hope that I have clarified matters.
Question put and agreed to.
Clause 29 ordered to stand part of the Bill.
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