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Session 2007 - 08
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General Committee Debates
Housing and Regeneration Bill

Housing and Regeneration Bill

The Committee consisted of the following Members:

Chairmen: Mr. Joe Benton, †Mr. Roger Gale
Blackman, Liz (Vice-Chamberlain of Her Majesty's Household)
Blackman-Woods, Dr. Roberta (City of Durham) (Lab)
Brown, Lyn (West Ham) (Lab)
Burt, Alistair (North-East Bedfordshire) (Con)
George, Andrew (St. Ives) (LD)
Gwynne, Andrew (Denton and Reddish) (Lab)
Hurd, Mr. Nick (Ruislip-Northwood) (Con)
Love, Mr. Andrew (Edmonton) (Lab/Co-op)
Moran, Margaret (Luton, South) (Lab)
Öpik, Lembit (Montgomeryshire) (LD)
Raynsford, Mr. Nick (Greenwich and Woolwich) (Lab)
Shapps, Grant (Welwyn Hatfield) (Con)
Slaughter, Mr. Andy (Ealing, Acton and Shepherd's Bush) (Lab)
Smith, Ms Angela C. (Sheffield, Hillsborough) (Lab)
Syms, Mr. Robert (Poole) (Con)
Wright, Mr. Iain (Parliamentary Under-Secretary of State for Communities and Local Government)
Young, Sir George (North-West Hampshire) (Con)
Hannah Weston, Committee Clerk
† attended the Committee

Public Bill Committee

Thursday 17 January 2008


[Mr. Roger Gale in the Chair]

Housing and Regeneration Bill

Clause 43

Question proposed [this day], That the clause stand part of the Bill.
1 pm
Question again proposed.
The Parliamentary Under-Secretary of State for Communities and Local Government (Mr. Iain Wright): It is a pleasure to see you back in the Chair this afternoon, Mr. Gale.
I think that this morning I covered adequately the points about guidance raised by hon. Members, and I gave some examples.
Lembit Öpik (Montgomeryshire) (LD): I am grateful for the clarification that the Minister provided. However, one concern remains, to which he could respond now or, if necessary, in writing. Will he provide clarity on the question of whether the guidance is binding or advisory, as it would be useful for the Homes and Communities Agency to know what is expected of it? I am not putting him on the spot: if he wants to consider that question, and respond in writing, or later in Committee proceedings, I am comfortable with that.
Mr. Wright: As I think I mentioned this morning, my understanding is that guidance is guidance, and that it is not binding. However, if I have inadvertently misled the Committee, I shall make Members aware of it.
My right hon. Friend the Member for Greenwich and Woolwich made a point about guidance to the regulator. Clause 40, which we agreed this morning, places a duty on the agency to co-operate with the regulator. We expect that to ensure that the two bodies can work together and exchange information where appropriate. A reciprocal arrangement is provided for in clause 102, which places a similar duty on the regulator to co-operate with the agency. I hope that that reassures hon. Members.
Andrew George (St. Ives) (LD): In my contribution, I sought clarification on the question of whether guidance could go up from the HCA to the Secretary of State in the manner that I described. That sort of communication is important. The HCA should be free to give such guidance and advice, but that is not made explicit in the Bill.
Mr. Wright: I apologise to the hon. Gentleman for not addressing that point. Guidance could certainly be given upwards to the Secretary of State, although it would not be binding, as I said to the hon. Member for Montgomeryshire. However, the free exchange of ideas and opinions will certainly be important to the Secretary of State and the agency. I hope that that reassures the hon. Gentleman.
Question put and agreed to.
Clause 43 ordered to stand part of the Bill.
Clauses 44 to 46 ordered to stand part of the Bill

Clause 47

Support services
Question proposed, That the clause stand part of the Bill.
Mr. Nick Raynsford (Greenwich and Woolwich) (Lab): In an earlier debate, I expressed concern about whether the definition of “a project” in clause 47(1) was unduly restrictive. I hoped that the amendments that I tabled at the end of our discussions on Tuesday would be considered today, but I was working on the basis of older procedures under which a one-day notice period was acceptable. I had forgotten that two days are now required, so my amendments were not eligible for selection today. Nevertheless, the issue remains important. I know that we discussed the matter earlier, but my hon. Friend the Minister undertook to consider further whether the tight definition of a project, although important to emphasise the time limit, might be unduly restrictive geographically if a group of projects are part of one initiative. Has he reflected further? We may need to return to the issue if it is not possible to provide satisfactory assurances.
Mr. Wright: I am pleased that my right hon. Friend caught your eye, Mr. Gale. I wish to put on record the fact that references to “a project”, which we discussed in an earlier sitting, will not prevent the agency from providing services to a project that is under way in a number of locations across England. In that respect, it is not geographically constrained. Equally, the clause does not mean that the agency can provide support services only to a single project at any one time.
The use of the word “project” is intended to identify circumstances that have a start and end date, between which times the agency has been asked, or has offered, to provide support services in one of the ways identified later in the clause. I hope that that reassures my right hon. Friend.
Question put and agreed to.
Clause 47 ordered to stand part of the Bill.
Clauses 48 and 49 ordered to stand part of the Bill.

Clause 50

Consents of the Secretary of State
Question proposed, That the clause stand part of the Bill.
Sir George Young (North-West Hampshire) (Con): I believe that you were in the Chair, Mr. Gale, when we discussed clause 10. In that debate, markers were put down for our discussion of clause 50. I refer to column 233 of our proceedings of 15 January. The context of the debate was the disposal of land at less than best price, and the Minister said:
“I will touch upon that in some respects as I answer the amendments, but I suggest that we put a marker down in terms of discussing it further under clause 50.”——[Official Report, Housing and Regeneration Public Bill Committee, 15 January 2008; c. 233.]
As we are now debating clause 50, will the Minister define slightly more clearly than he did in the debate on clause 10 the circumstances of any general consent that the Secretary of State might give the HCA to dispose of land at less than best price? He will recall that the Committee spent some time on that, and there was concern about an over-restrictive approach to such disposal. Will he do what he said he would do, and discuss the matter further now?
Mr. Wright: As the right hon. Gentleman said, we had an in-depth discussion on the matter when we debated clause 10, and I undertook to do additional work to reassure hon. Members on clause 50. The point is important, and I was rightly challenged on best consideration and the agency’s wider objects.
Clause 50 empowers the Secretary of State to grant consent to the Homes and Communities Agency when it proposes to exercise powers that are subject to that consent, such as the giving of financial assistance, forming or acquiring companies or—this was the point mentioned under clause 10—the disposal of land for less than best consideration. Consent may be given with or without conditions, and generally or specifically, as circumstances require.
Following our debate on clause 10, I should like to set out in more detail the way in which general consents for the disposal of land at less than best consideration are operated by local authorities, the role of English Partnerships and an indication of the nature of general consents that we plan under clause 50. First, I shall first set out the situation for local authorities. They have sought, and been given, the Secretary of State’s consent to dispose of land at less than best consideration under the Local Government Act 1972 and the Town and Country Planning Act 1990. The most recent guidance on general disposal consents was issued in 2003 under the 1972 Act. It sets out measures whereby local authorities can dispose of land at less than best consideration if the disposal meets a “well being test”, as well as the difference between the open-market value on disposal and circumstances in which its value, subject to conditions imposed by the local authority, is less than £2 million. The provisions have been used by local authorities on several occasions, but as I told the Committee on Tuesday, consent is not required, so we do not hold records of disposals carried out under the general consent.
On disposals above the £2 million level, approximately eight consents are given each year under the Local Government Act 1972 and the Town and Country Planning Act 1990, and I can give the Committee examples to illustrate the point and drive the debate forward. In October 2003, in the London borough of Brent, there was a freehold disposal of land on the Chalkhill estate in Wembley for the purpose of housing. It was disposed to the Metropolitan Housing Trust, and the under-value was £2.04 million. Similarly, in August 2004, Basingstoke and Deane borough council disposed of the freehold of undeveloped land at Foxdown, in Hampshire, to Westbury Homes Ltd; the land was for residential development, and the under-value was £2.5 million.
The point that I made earlier about the wide definition of well-being is not confined to housing. The London borough of Greenwich disposed of the leasehold of a school site in Abbey Wood to St. Paul’s Academy; the land was for a city academy school, and the under-value was £7.39 million. Ipswich borough council disposed of land to University Campus Suffolk for the development of a university campus, and the under-value was £9.32 million. The important point is that there are precedents, and the definition of well-being, as set out under the general consents in the Local Government Act 1972, is incredibly wide. That shows what the agency could do when disposing of land at less than best consideration.
Margaret Moran (Luton, South) (Lab): As it was I who asked for the evidence base, I feel compelled to ask my hon. Friend what proportion of all requests those eight consents represent—I guess that they are a tiny number in relation to the number of permissions that were needed or asked for. Given that we are talking about a mix of residential and other permissions, what is the percentage of residential permissions, particularly for social housing purposes?
Mr. Wright: My hon. Friend makes an important point, but she will appreciate that I do not have that information to hand. However, I will endeavour to provide it to the Committee as soon as possible. As I said, we are in the dark in some respects, but I will do my best to find out the precise proportion of residential permissions in terms of the general consent above £2 million.
Grant Shapps (Welwyn Hatfield) (Con): The Minister mentioned Chalkhill estate in Wembley and a figure of £2 million. I actually stood for election in that estate under the unusual election slogan of “Vote for us on Thursday and we will knock down your house on Friday”. It was a disastrous ’60s estate, and the proposal turned out to be quite popular, as I missed out by 60-odd votes on taking what had previously been a very safe Labour seat. The point, however, is that it took an awfully long time to get housing development in that area going; in fact, it was only many years after that election in 1994 that a project got under way. Is the Minister suggesting that his proposals will make it more or less likely that such projects will take place? As he rightly said, it is a question of getting the right deal and the right valuation in place and of getting the whole thing moving. As I said, it was very complex to get that development going. Does he believe that what is described in the Bill will make that process easier? I am sure that that is an easy question to answer.
Mr. Wright: I am intrigued. The hon. Gentleman seems to have a knack and panache for slogans. I do not think that “Vote for me on Thursday and I’ll knock your house down on Friday” is as good as “No way to 10k”, but it is still a good slogan. I think that the hon. Gentleman knows the answer to his question, which is that the whole point of the Homes and Communities Agency is to remove as many barriers as possible and to facilitate, smooth and lubricate the processes. Notwithstanding the statutory planning framework in which it will operate, it will ensure that developments are accelerated as much as possible, that difficulties are analysed quickly and that possible solutions involving partnership with the relevant authorities are introduced as quickly as possible.
Mr. Andrew Love (Edmonton) (Lab/Co-op): My hon. Friend the Minister has reassured us on the question of compliance with the objects of the HCA, and he is right to reassure us about continued well-being and the fact that that provision is widely drawn. May I raise with him an issue that an Opposition Front-Bench spokesman raised yesterday? What would happen if improvements that are needed to an estate resulted in a reduction in the number of housing units? Does the well-being definition that the Minister is considering include such a situation?
1.15 pm
Mr. Wright: It could well do. I return to the point that I made about referencing to the hon. Member for North-East Bedfordshire with my hat on as Minister with responsibility for housing market renewal. The density of an area, with two-up two-down housing and large tracts of terraced housing, for example, may mean that we need fewer affordable housing units on the site. The circumstances that my hon. Friend mentioned would be entirely reasonable, so I hope that that reassures him.
English Partnerships does not have the general consent to dispose of land at less than best consideration, and if it wanted to do so, it would need to seek the consent of the Secretary of State. We touched on the following issue in clause 10. English Partnerships disposes of land with attached specifications that meet its regeneration objectives through an open-market competition and it then accepts the highest bid. Such specifications may need the consent of the Secretary of State if they include matters of wider public benefit.
Mr. Raynsford: My hon. Friend has pointed out that English Partnerships does not have the benefit of the general consent, so will he make it absolutely clear to the Committee whether he intends the general consent to apply to the new agency? If so, first, will it specify the categories or circumstances in which the power may be used and, secondly, will a financial limit apply, above which the consent of the Secretary of State will be required?
Mr. Wright: As ever, my right hon. Friend focuses on the key point. He is right to point out that English Partnerships does not have the general consent, but we need a step change, a culture change, and it is right that it applies to the agency. The specific circumstances in which the general consent will be made, and the limits on it, will be subject to the tasking framework, but I shall come on to what I think will be the parameters, and perhaps illustrate the type of circumstances to which the general consent will apply. I hope that I have reassured Members about that.
On whether the Bill provides the right framework, I mentioned on Tuesday the Goldilocks principle regarding clauses 10 and 50. It involves providing the right legislative basis to ensure that the new agency can dispose of land at less than best consideration in order to achieve its objectives of improving housing supply and driving forward regeneration, while ensuring that the public purse is as protected as much as possible. I do not think that further amendments are necessary.
We have mentioned today that the Committee has sought reassurance about how, underneath the legislation in the Bill, we will give the agency the framework to deliver the necessary housing and regeneration that all Committee members have emphasised. I have also already said that we are committed to issuing the general consent under clause 50 to enable the agency to act without having to seek the Secretary of State’s consent for every disposal. In response to my right hon. Friend’s point, we need to consult stakeholders about the terms of the general consent. We are examining the local government model, but we must consider whether the levels are appropriate.
Margaret Moran: I am pleased to hear that the Minister wants to consult more widely on general consent; that is helpful. However, when he does so, and when he considers the local government model, will he remember that we are trying to reach a practical outcome in order to meet the objectives? Currently, the general consent is narrowly defined and administratively onerous. When one looks at the form, which is 36 pages long, one can imagine local government and the HCA being put off from considering such consents. Consequently, the opportunities for social housing from the disposal of land may be missed if the sale goes to a private developer.
Mr. Wright: My hon. Friend is spot-on in her analysis. We do not want the procedure to be too onerous, and the point of general consent in many respects is not to have to go to the Secretary of State. If my hon. Friend will allow me, I will give an example of where general consents might be used, because that is pertinent and a good illustration for the Committee. They tend to involve the disposal of land, and the agency might be disposing of many, similar plots of land throughout England. In such circumstances, I do not think it is unreasonable for the Secretary of State to issue a general consent stipulating that so long as the land to be disposed of is worth less than a specified amount, the agency could do so without having to seek separate consent from the Secretary of State on each occasion.
That is important, because there will be a step change in housing supply and quality in England if a local authority or registered housing landlord can use infill when it has a bit of land on an estate or a bit of wasteland that could be used for five, six or seven houses. I am not talking about garden-grabbing, so the Opposition need not get excited, but about pieces of land that might be on estates and could be used for six or seven houses. Going to the Secretary of State to dispose of that land would be onerous in many respects, and I do not think the numbers would stack up if it was at less than best consideration. If we agree a certain amount, which could be £2 million or whatever, I think that would help to free up and accelerate the use of land for infill development—I see hon. Members nodding. I think it would be reasonable for the agency to do that, and it is a reasonable framework in which general consents could be considered by the Secretary of State.
Andrew George: I caution the Minister that the market for land is not an even or homogenous market throughout the country. For example, the price of land in some villages overlooking the sea in Cornwall command very high prices for small levels of development. I want to probe the Minister on the specified consent available to English Partnerships. It is presumably specified that it may dispose of land if that would provide employment on that land. Could the Government extend that in the Bill to the HCA and specify that such land must be used for affordable housing? English Partnerships currently has that general consent to specify that land can be used for employment, so could the principle not be extended to the HCA specifying that the land must be used for affordable housing?
Mr. Wright: The hon. Gentleman raises an interesting point and has emphasised the importance of English Partnerships’ work on regeneration throughout our proceedings. That is not unreasonable. We have established the legislative framework in the Bill, and I want to consult on the framework below that for what can happen operationally. His suggestion can certainly be considered. I draw the hon. Gentleman’s attention yet again to the point that I made earlier about the well-being test, which is broadly defined so that it can take account of social, economic, environmental and regeneration objectives. I hope that that satisfies him.
Returning to the hon. Gentleman’s earlier point, I am keen to see the culture change and the step change that the new agency can offer. I want to ensure that we accelerate the supply of housing in England, and this could be a means of doing so. English Partnerships, the Housing Corporation and a number of authorities are already forging ahead with innovative projects such as those that I mentioned, and we want to do everything we can to encourage that in future. I give way to my hon. Friend.
Margaret Moran: I will give my hon. Friend a breather and reiterate an earlier point. Will he consult on the extreme complexity of the current consent requirements? My point is not just about length: the requirements are extremely technical and I can imagine that both the HCA and local government might be put off by the resources involved in putting them forward to the Secretary of State. That slows down the whole process and risks affecting the speed of development that we are trying to achieve.
Mr. Wright: My hon. Friend looked poised to get to her feet, and I apologise if I made her do so, but she makes a good point. I have asked my officials to work with existing bodies and stakeholders to consider this issue and what the terms of consent should be, as well as considering the issue more widely in relation to the opportunities, challenges and barriers to disposal of less than best consideration. Her point about the length and complexity of guidance is a valid one, and I shall ask that that be included.
Grant Shapps: We like a lot of what we are hearing. It sounds like good common sense to think about having a limit of £2 million or so. However, we ask that it be future-proofed, so that we do not end up with a figure that has not been uprated. Hon. Members have made similar points about regional differences, and more work probably needs to be done on that, but it sounds as though things are moving in the right direction.
Mr. Wright: I thank the hon. Gentleman for his positive comments, and I shall take on board his points. Future-proofing is an important consideration.
I hope that I have reassured the Committee today and with the points that I made on Tuesday about clause 10 and the Goldilocks principle. Clause 10 is not too onerous on the selling of land and is not so flexible that the public are not reassured that they are getting good value for money. It is just right, and that is the right approach to take. We are taking the right approach by introducing clause 10 in conjunction with clause 50 and the framework behind it, which I have explored today, and which hon. Members have probed.
Question put and agreed to.
Clause 50 ordered to stand part of the Bill.
Clause 51 ordered to stand part of the Bill.
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