New Clause
27
Former
right to buy and other flats: equity share
purchases
‘After section 450C
of the Housing Act 1985 (c. 68) (loans in respect of service charges)
insert—
“Other financial
assistance in respect of service
charges
450D Purchase of
equitable interests
(1) The
appropriate national authority may by regulations provide that
where—
(a) a housing
authority is the landlord of a flat under a long lease granted or
assigned by the housing authority or another housing authority,
and
(b) the tenant is liable
under the terms of the lease to pay service charges in respect of
repairs or improvements (whether to the flat, the building in which it
is situated or any other building or
land),
the landlord may, with
the agreement of the tenant and in such circumstances as may be
prescribed, purchase an equitable interest in the flat for the purpose
of assisting the tenant to meet some or all of the service charge
payments.
(2) Regulations under
this section shall ensure that the purchase price is to be met by the
landlord reducing or (as the case may be) cancelling the service charge
payable to the landlord by the tenant to such extent as corresponds to
the amount concerned.
(3)
Regulations under this section may, in
particular—
(a) provide
that the power to purchase an equitable interest does not arise in the
case of particular descriptions of
landlord;
(b) make provision
about calculating the purchase price (including provision about any
discounts and about imposing charges for the services of district
valuers);
(c) provide
for—
(i) the tenant to
be liable for the administrative expenses of the landlord in connection
with the purchase;
(ii) such
expenses not to exceed such amount (if any) as may be specified in the
regulations;
(iii) the purchase
price to include, at the option of the purchaser, a deduction for such
expenses;
(d) provide for an
alteration, as a result of the purchase of the equitable interest, in
the liability of the tenant for future service charges or improvement
contributions.
(4) Regulations
under this section may not contain provision for cases where the
Secretary of State or the Welsh Ministers are the landlord unless the
Welsh Ministers are the
landlord—
(a) as the
result of the exercise by them of functions under Part 3 of the Housing
Associations Act 1985; or
(b)
as the result of—
(i)
the exercise by the former National Assembly for Wales, the Secretary
of State, Housing for Wales or the Housing Corporation of functions
under Part 3 of the Act of 1985;
and
(ii) the transfer of the
flat to the Welsh Ministers by virtue of paragraph 39 of Schedule 11 to
the Government of Wales Act
2006.
(5) For the purposes of
this section a long lease granted or assigned
by—
(a) the Welsh Ministers,
or
(b) in a case falling within
subsection (4)(b), the former National Assembly for Wales, the
Secretary of State, Housing for Wales or the Housing
Corporation,
shall be taken to
have been granted or assigned by a housing authority if (but only if)
the person concerned granted or assigned it in exercise of its powers
under section 90 of the Housing Associations Act
1985.
(6) This section does not
affect any other power of the landlord to purchase an equitable
interest in the flat for the purpose of assisting the tenant to meet
some or all of the service charge
payments.
(7) Regulations under
this section may apply whenever the lease concerned was granted or
assigned and whenever the service charge concerned became
payable.
(8) Regulations under
this section—
(a) are to
be made by statutory
instrument;
(b) may make
different provision for different cases or descriptions of case
including different provision for different
areas;
(c) may contain such
incidental, supplementary and transitional provisions as the
appropriate national authority considers
appropriate.
(9) An instrument
containing regulations made under this
section—
(a) by the
Secretary of State is subject to annulment in pursuance of a resolution
of either House of
Parliament;
(b) by the Welsh
Ministers is subject to annulment in pursuance of a resolution of the
National Assembly for
Wales.
(10) In this
section—
“appropriate
national authority”
means—
(a) in relation
to England, the Secretary of State;
and
(b) in relation to Wales,
the Welsh
Ministers;
“former
National Assembly for Wales” means the Assembly constituted by
the Government of Wales Act
1998;
“housing
authority”
includes—
(a) any
registered provider of social housing other than a co-operative housing
association;
(b) any registered
social landlord other than a co-operative housing association;
and
(c) any co-operative
housing association which is
not—
(i) a registered
provider of social housing;
or
(ii) a registered social
landlord;
“improvement
contribution” has the same meaning as in Part 5 (see section
187);
“repairs”
includes works for making good a structural
defect.”’.—[Mr.
Wright.]
Brought
up, and read the Firs t and Second time and added to the
Bill.
New
Clause
28
Amendments
to Housing Act 1985 relating to lending
institutions
‘In section
622(1) of the Housing Act 1985 (c. 68) (minor definitions:
general)—
(a) in the
definition of “authorised deposit taker”, in paragraph
(b), for “12(1)” substitute “12”,
and
(b) in the definition of
“authorised insurer”, in paragraph (b), for
“12(1)” substitute
“12”.’.—[Mr.
Wright.]
Brought
up, and read the First time.
Mr.
Wright:
I beg to move, That the clause be read a Second
time.
The new clause
is technical. It aims to ensure that clause 264 applies to all relevant
institutions. Clause 264 is designed to reduce the regulatory
burden on lenders, who currently have to apply twice to different
Departments for what is, in effect, the same approval, which is, as I
am sure that Committee members agree, both bureaucratic and pointless.
At the same time, the clause clarifies the protection afforded to
right-to-buy providers.
I will spend a moment providing
the background. If a tenant buys their home under the right to buy and
resells it within five years, their former landlord may require them to
repay some or all of the discount that they received. That obligation
is secured by a charge on the property. The same obligation applies to
the right to acquire from registered social landlords under the Housing
Act 1996 and to voluntary sales at a discount by both local authorities
and RSLs. The landlord’s charge protecting the discount payment
would normally have priority. However, if the owner has a mortgage and
is unable to keep up the payments, approved lending institutions are
entitled to recover what they are owed ahead of the landlord’s
entitlement—in other words, they have first charge on the
property. That protection has been in place since the introduction of
the right-to-buy scheme in 1980.
We know from
recent consultation, and from comments on a slightly removed point at
the oral evidence sitting last month, that lenders in the right-to-buy
market regard that protection as important. Lenders with ALI status are
specified in various pieces of legislation: first, in section 156 of
the Housing Act 1985 with respect to right-to-buy sales, which also
applies to right-to-acquire sales; secondly, in section 36 of the same
Act with respect to voluntary sales by local authorities; and, finally,
in section 12 of the Housing Act 1996 for voluntary sales by
RSLs.
That specification also
applies to sales by housing action trusts under the Housing Act 1998
and where properties have been sold under the rent-to-mortgage scheme,
which is no longer available. Although some financial bodies are
automatically ALIs, at present others only become ALIs on being
specified as such by the Secretary of State. As I alluded to earlier,
such lenders have to come to the Government twice: first, to the
Financial Services Authority for authorisation to conduct lending
business, and, secondly, to my Department for approval as a
right-to-buy lender. The clause and the amendments will remove that
unnecessary
duplication.
My
Department has no powers of expertise in financial regulation and, as
somebody who did his tax return at the weekend, I have no financial
expertise whatsoever. Approvals under sections 156 and 36 are given on
the advice of others, including the Office of Fair Trading and
Companies House. All lenders accorded ALI status under the current
system meet the requirements of FSA authorisation and
regulation.
4.15
pm
In
November 2006, the Treasury Committee recommended that responsibility
for approving lending institutions for right-to-buy purposes should be
transferred
to the Financial Services Authority. The Government agree that the FSA
is better equipped than my Department to oversee the market and
therefore propose to combine right-to-buy approval with FSA
authorisation. The initial assessment of suitability will be made by a
fully qualified regulator, and the lenders’ activities will
subsequently be monitored by that regulator, where specialist staff
will be alert to potential problems. Clause 264 removes the
Secretary of State’s powers under sections 36 and 156 to specify
bodies as approved lending institutions and to revoke that status.
Instead, it adds the term “an authorised mortgage lender”
to the relevant lists of automatically approved lending institutions.
An authorised mortgage lender means one authorised for that purpose by
the
FSA.
The
new clause alters references in section 622(1) of the Housing Act 1985
to schedule 3 to the Financial Services and Markets Act 2000 in respect
of the terms “authorised deposit taker” and
“authorised insurer” to ensure that the definition of an
ALI is consistent with the regulatory regime established by the 2000
Act. The alteration consists of referring to paragraph 12 of schedule 3
to the 2000 Act rather than to paragraph 12(1). The FSA has advised me
that the wider reference is correct. Clause 264 makes that alteration
for the definition of an authorised mortgage lender, and this new
clause makes the same alteration for the definitions of authorised
deposit taker and authorised insurer.
I am sure, Mr.
Benton, that everyone found that absolutely thrilling. [Hon.
Members: “Hear, hear.”] They are far too
kind. I am happy to repeat all that I have just mentioned, if they so
wish, but on this occasion I will not do
so.
Question put and agreed to. Clause read a
Second time, and added to the
Bill.
New
Clause
5
Abolition
of home information
packs
‘(1) Sections 148 to
170 of the Housing Act 2004 (c. 34) are hereby
repealed.
(2) A person who is
selling a residential property must supply the purchaser with
information about the energy efficiency of the
property.
(3) The Secretary of
State may make regulations prescribing the particular information which
is required or authorised to be included in, or which is to be excluded
from, such energy efficiency information and all other incidental
matters relating thereto.’.—[Grant
Shapps.]
Brought
up, and read the First
time.
Grant
Shapps (Welwyn Hatfield) (Con): I beg to move, That the
clause be read a Second
time.
I
feel that we have been here before. When we were debating HIPs last
week, the Minister said that we were flogging a dead horse, but if only
it were so. The legislation has been virtually pointless, and its
useless implementation has been matched only by its introduction. It is
worth reminding the Committee that the legislation followed a troubled
path into operation across numerous pledges and manifestos. It was
eventually introduced, but the home condition report is the critical
point. When the home condition report—effectively a survey
produced by the seller rather than the buyer of a property—was
dropped, it rendered the HIP virtually useless. However, rather than
recognising the difficulties
that the legislation had run into, the Government
pushed forward, which is the point that new clause 5 seeks to
address. Following
the watered-down home condition report, there were incredible delays in
the rest of the implementation, including a staggered introduction. The
measure was delayed until August, which was followed by separate
introductions for four-bedroomed properties, three-bedroomed properties
and one and two-bedroomed properties. There were also delays in the
legislation, which, even to this day, does not require, for example,
leasehold documents to be included in a HIP or, for that matter, for
the HIP to be obtained.
It is a
requirement of the current bureaucratic legislation only that the HIP
is ordered. If a house is sold before it is obtained, it does not
matter, because of an exemption called first-day marketing, which means
that somebody can market their home on the first day that they have the
idea to put it up for sale. It seems to most onlookers that if the
first-day marketing exemption were scrapped—so far, it has been
extended on two occasions, most recently last week to 1 June—it
would be almost impossible for the HIPs system to operate. If it were
scrapped, one would need to have received a HIP to put one’s
house on the market, which is not as straightforward as this Minister
and the Minister for Housing like to pretend. I say that from personal
knowledge, because, as I reported to the House last week, I have
ordered a
HIP.
Mr.
Wright:
How is your HIP? Is it a new
HIP?
Grant
Shapps:
Well, I am pleased to report to the
Minister—I think that I told him this at the time—that
the energy performance certificate was supplied within 72 hours, and I
have it here. Eleven days later, however, the HIP has yet to appear. If
I had purchased the HIP with the intent of selling my house and the
exemption to first-day marketing had not been extended till 1 June, I
would be legally forbidden from putting my house on the market, which
is nonsense. The idea that the legislation is fine, but only because it
has a massive hole in it—the first-day marketing
exemption—makes a mockery of the entire
legislation.
The issue
involves more than the time taken, although I understand that if one
happens to live in an area supplied by Southern Water, the delays are
such that someone who ordered their HIP in October last year will still
not have received it, because the search details will not have come
through. That water company wrote to conveyancers in the area
explaining that it could not supply the water searches for two months.
Those people would be unable to sell their homes, if it were not for
the first-day
exemption.
Mr.
Wright:
I am being slightly flippant, if not cheeky, and I
run the risk of being ruled out of order. If the hon.
Gentleman’s HIP comes tomorrow, it will have taken 12 days, so a
new hip is a lot quicker under Labour than the
Tories.
Grant
Shapps:
Thank you for your intervention, Minister, which
is significant, because it demonstrates the extent to which it has been
hard to get the Government to focus on the true issues. It is easy for
them simply to provide a sneering look and move on
with business, but the reality is that if one orders a HIP and it does
not come, one would not be able to sell one’s house without the
exemption. If that is not the case, I challenge the Government to get
rid of the exemption straight away, but they know that that is the case
and that the problem is significant.
Unfortunately,
the problems do not end there. The difficulty with the HIPs legislation
is that it goes against the grain of human nature. When one buys
something as big as a house, one would be insane not to want to carry
out one’s own searches. My neighbour put their home on the
market a year ago. Due to a slowing housing market and possibly some
other factors, that house has not sold. Had they been required to get a
HIP, it would probably have been replaced on two occasions by now. It
would be insane to trust search information so far out of date, if one
were buying that house. That, in a nutshell, is the fundamental flaw in
asking the seller to commission the work that is required at the time
of purchase by the
buyer.
Mr.
Nick Raynsford (Greenwich and Woolwich) (Lab): The hon.
Gentleman has said that it would be insane to purchase something as
significant as a house without obtaining all the relevant information.
How many people under the old system commissioned a survey before they
purchased a house—entering into probably the biggest financial
transaction in their life without adequate information about what they
were making an offer
on?
Grant
Shapps:
The reality is that the information that the buyer
gets depends on the buyer. I think that the right hon.
Gentleman’s point is that most people do not commission a full
survey on their homes, which is entirely up to them. The home condition
report would never have been a full survey on the house. Home condition
reports are available, but only 4 per cent. of people who have ordered
a HIP to date have bothered to get a home condition report, including
those paid by the Government to order HIPs—the £4 million
trials. That home condition report is not of the same standard and
quality as a home condition report that one would get if one were to
survey one’s home, which would be carried out by an entirely
separate body.
Grant
Shapps:
I challenge the right hon. Gentleman to discuss
whether home inspectors are the same as, for example, chartered
surveyors.
Mr.
Raynsford:
The hon. Gentleman will recall making a
pejorative remark about the survey being commissioned by the seller,
not the buyer, and implying that that somehow tainted it. The reality
is that the surveys will be carried out either by approved inspectors
or, in the case of the old system, by surveyors. The crucial thing
about the HIPs system is that the liability will allow the purchaser of
the property to seek redress, if the survey is not accurate, which is
the key thing. Will he explain to the Committee how he justifies his
party’s support for the old arrangements, where £1
million was lost to consumers every day of every year because of
inherent inefficiency and delays?
Grant
Shapps:
I am grateful to the right hon. Gentleman, whose
knowledge of the housing market is usually impeccable. The actual
figure is £320 million a year, which is not quite £1
million a day, and those costs have not, of course, disappeared because
of HIPs. Furthermore, he should be aware—I am sure that he is
aware—that a home inspector who has studied for a period of time
is not equivalent to a chartered surveyor. The people who normally
carry out home inspections for the purposes of a survey are different
from the people who are invited to carry out a home condition report.
The right hon. Gentleman’s argument is not, in fact, with me,
but with his own Front Benchers, who scrapped the requirement for a
home condition report. It is not, after all, part of what is happening
in the marketplace—nobody is bothering to get an HCR because
they recognise it has very little value to the purchaser, who will want
to purchase that survey
themselves.
The
right hon. Gentleman asked a two-part question, the first part of which
concerned the survey or home condition report and the second part of
which concerned searches. The searches will sometimes be in place
following the introduction of HIPs, which leads to the question whether
any solicitor worth his salt, acting on behalf of the buyer, is going
to trust information provided some months earlier. House sales take
time—from the moment when a buyer and seller agree in principle
to the sale, it is typically a three-month process—so most
solicitors acting for a buyer are simply not going to trust that
document. I am not sure why it is so difficult for the Government to
see and understand the reality that people are paying the costs twice.
The seller is now having to commission this information, much of
which—even most of which—is repeated by the buyer, which
is the problem with
HIPs.
The
Government repeatedly misquote the cost at £300. I invite the
Minister to come clean, because we know that VAT is added. Tax is
involved in the additional bureaucracy, so at the very minimum the cost
is £350, and experts in the marketplace are saying that average
costs are coming out nearer £400 or £500, which does not
take into account running HIPs or the situation if home condition
reports are included. The body of evidence makes it clear that the
delay is unacceptable. The Government know that the delay is
unacceptable, which is why they have had to skewer their own
legislation with an exemption to allow people not to receive their
HIPs, because it is sufficient to order a HIP under the first-day
marketing
exemption.
On
my HIP, it is 11 days and counting. With the permission of the
Committee, I will report back when it eventually comes through. As
things stand, however, I would be unable to sell my house. New clause 5
seeks to resolve that problem. Energy performance certificates are, as
we have said all along, a good idea, because they will enable people to
make the comparison between their own houses and those of friends and
neighbours, if they wish to share that information. It is absolutely
sensible to liberate the energy performance certificate from the shell
of a HIP. By cutting away the bureaucracy that surrounds EPCs and
allowing them to stand on their own, we will enable them to spread
faster and wider, to become more generic and to achieve our common
objective of greener
homes.
The new clause
is an attempt to do just that. It is time that the Government admitted
that they made a
mistake with the legislation, which experts have
ridiculed, the industry does not want, the market does not need and the
new clause would
scrap. 4.30
pm
Mr.
Wright:
Here we go again. We have debated this many
times.
Ms
Angela C. Smith (Sheffield, Hillsborough) (Lab):
Endlessly.
Mr.
Wright:
Indeed. We had an Opposition day debate—my
first ever, actually—on HIPs on 10 October, a statutory
instrument on 18 October and a further statutory instrument last
Wednesday. Frankly, I am extremely concerned that the hon. Gentleman
feels the need to use valuable parliamentary time not to have
Opposition day debates about the supply of new housing or to talk about
how to improve its quality, but to protect vested interests—my
right hon. Friend the Member for Greenwich and Woolwich has referred to
the cost of £1 million a day. It is simply not on. We need to
move away from that and ensure that we talk about the real issues on
housing
policy.
Alistair
Burt (North-East Bedfordshire) (Con): Will the Minister
confirm that the vested interests of whom he speaks are the same people
from whom the Government sought advice, namely surveyors and others in
that area of work? When the Government did not like the advice that
they got, those people suddenly they became “vested
interests” to be abused by the
Government.
Mr.
Wright:
Everybody, Government and Opposition alike,
recognises that the current home buying and selling process needs to
change. My understanding was that the hon. Member for Welwyn Hatfield
appreciated that and was doing something about
it.
Grant
Shapps:
Undertaking a
review.
Mr.
Wright:
Exactly. I am glad that the hon. Gentleman is
doing
that.
Mr.
Raynsford:
Does my hon. Friend recall that when the HIPs
scheme was first trialled, it commanded the support of almost all the
professional bodies, which could see the clear benefit of reforming an
inefficient system under which, every time a buyer commissions a survey
and the sale falls through, the fee is lost? If it takes three, four or
five times for the sale to go through, the surveyor does very well,
because he sells the survey again and again. That was the absolute
waste of money in the old system, which the Opposition continue to
defend. Is not their position
untenable?
Mr.
Wright:
Absolutely. The biggest losers in all this tend to
be first-time buyers, who are at a disadvantage in any case because of
spending power, and we are trying to address that. Government Members
recognise—I thought that Opposition Members did too—that
the current house buying and selling process is confusing, expensive,
stressful and opaque, and we need to do something about it.
That is why, frankly, I cannot
quite understand why the Opposition have tabled a new clause that would
do away with HIPs, when all the indications are that the measure is
starting to work incredibly well and is doing what it was intended to
do. The introduction of HIPs brought information up front in the
process for the first time, and transferred costs from the buyer to the
seller, making it easier for first-time buyers to get on the housing
market ladder.
I
thought that the hon. Member for Welwyn Hatfield would share my
aspirations and ambitions for first-time buyers, but clearly that is
not the case. Now that HIPs are operational and working well in the
marketplace, with all the indications showing so far that they are
bringing the intended positive benefits, I cannot quite believe that
the Opposition still want to pull the rug from under first-time
buyers’ feet. We should all be committed to improving the home
buying and selling process, not looking
back.
Margaret
Moran (Luton, South) (Lab): I wholeheartedly agree that
this is all about the protection of potential or existing
owner-occupiers, and I happen to think that the HIPs process has
brought in greater protection. If the hon. Member for Welwyn Hatfield
is genuinely concerned about protecting those people, he should make
greater efforts to look at the other end of the scale. Unscrupulous
financial institutions push elderly people to sell their homes and then
rent them back, and there are some dubious transactions that put those
elderly people and their homes at risk.
Mr.
Wright:
My hon. Friend has raised an important point. We
have all seen the adverts on television that tell people they can stay
in their own homes for the remainder of their lives, but that financial
penalties will be involved. The Conservatives should be considering
that, but they do not seem to be.
I will give the hon. Member for
Welwyn Hatfield the benefit of the doubt. I think that he wants
energy-efficiency measures for housing, but the effect of the amendment
would be to withdraw all the positive work that is going on. Last time
I checked, that was being done very successfully as part of the HIP.
More than 270,000 energy performance certificates have been produced to
provide information to sellers and prospective buyers alike on measures
to improve the energy efficiency of homes. I was about to refer to my
hon. Friend regarding oral questions last week, but I am happy to give
way to him.
Mr.
Andrew Love (Edmonton) (Lab/Co-op): If the Opposition
truly intend to press the new clause to a vote, is that not
irresponsible when we have set up the system and it appears to be
working?
Mr.
Wright:
If the new clause is pressed, I shall ask members
of the Committee who vote against the scheme to justify to their
electors why they have voted against protection for first-time buyers
and hard-working families, why they are trying to protect vested
interests and why they are trying to scrap energy-efficiency measures.
Given that the stock market is vulnerable and that we have the most
turbulent housing market for 15 years, why do they want to derail
things and to create further stress and uncertainty? That is to play
politics in a devious manner, and I will have no part in
it.
Grant
Shapps:
That is extraordinary rhetoric. Having just agreed
that we are not planning to scrap EPCs and would like them furthered,
the Minister slipped into a tirade as if scrapping them were our
policy. I hope that he accepts that the truth is that, if HIPs were
removed and EPCs did not apply only in respect of moving home, more
EPCs would be
issued.
Mr.
Wright:
I had been about to refer to the point made by my
hon. Friend the Member for Edmonton last Tuesday at oral questions. He
made an important point about assistance for people whose homes have
low energy ratings. I am happy to give way again to the hon. Gentleman,
because we would love to know the EPC rating of his
home——or one of them; I am not sure of his
status.
Grant
Shapps:
I can report that my EPC came in at a D, with a
little room for improvement in the A to G banding. I can also report
that, unlike some others, I have only one
home.
Mr.
Wright:
I am disappointed, because I wanted him to say
that he had an F or G-rated home so that I could have offered him the
help of the green homes service that I mentioned to my hon. Friend the
Member for Edmonton at oral questions and which we announced in
November. To every householder who gets an F or G-rated EPC for a home
being sold or bought, the green homes service will make an offer of
discounted or free help with energy efficiency. We expect some 10
million households to benefit from energy efficiency measures in the
first and subsequent phases of the energy efficiency commitment. We are
seeing a tremendous amount in terms of energy efficiency. Given that
something like 27 per cent. of all the UK’s carbon emissions
come from domestic dwellings, we need to do something about this. This
is up and running now: we are curbing carbon emissions and improving
energy efficiency as part of the HIPs process now. If the new clause
goes through, we just scrap that, we provide nothing and almost go back
to square one.
That
suggests that the Conservatives saying, “Vote blue and go
green” is somewhat
misleading.
Grant
Shapps:
In fact, the new clause does include provision for
the energy performance certificates to continue. Subsection (2)
says:
“A person
who is selling a residential property must supply the purchaser with
information about the energy efficiency of the
property”
and subsection
(3) says that the Secretary of State can prescribe exactly what that
is. We imagine that that would be an EPC.
Mr.
Wright:
But the wording is somewhat vague, and my
interpretation was quite strong, saying that it looked as though we
were going back to square
one.
Alistair
Burt:
I am struggling here. We have a lot of respect for
the Minister, as he knows, but where can he find ambiguity in the
words,
“A
person who is selling a residential property must supply the purchaser
with information about the energy efficiency of the
property”?
I am a lawyer
by background, but I would really struggle to get out of that
one—it is as plain as it can be. I would be grateful if he
reflected and said that the new clause does indeed guarantee that
energy efficiency would be right up there as the key ingredient in a
new
certificate.
Mr.
Wright:
No, I still maintain that it is very vague and
ambiguous and does not provide that
certainty.
Mr.
Raynsford:
Subsection (3) of the new clause
says:
“The
Secretary of State may make
regulations”—
not
“shall make
regulations”—
“prescribing
the particular information which is required or authorised to be
included in, or is to be excluded from, such energy efficiency
information”.
That is
absolute ambiguity and total freedom for the Secretary of
State—if it was a Tory, heaven knows what they would do. It
simply leaves an open door to an incoming Tory Administration to do
what they like, with absolute lack of
clarity.
Mr.
Wright:
I am extremely grateful to my right hon. Friend
for that
clarification.
The
dividing lines are most apparent. We are currently working to ensure
that home information packs and energy performance certificates work in
what is, frankly, a turbulent and uncertain housing market. We are
providing that reassurance, and we will not play fast and loose with
the housing market—no responsible Government would do
that.
We are working
now with energy companies to make the most of the EPC, linking
recommendations in the EPC with grants for improvement measures, given
the answer that I gave my right hon. Friend on Tuesday. This is all
part of the process for the phasing in of EPCs across all sectors of
buildings. Commercial buildings of more than 10,000 sq m are scheduled
to require them from April; in July this will extend to those of more
than 2,500 sq m; and in October to all remaining buildings. Public
buildings above 1,000 sq m will need to display an energy certificate
from October
2008.
All these
measures are part of an agreed package that will lead to a reduction in
carbon emissions. We are already considering ways of further enhancing
this environmental
package.
Alistair
Burt:
It might help the Committee to hear that the
Government had at least some humility about the way in which HIPs were
introduced, following the recent critical report. What was the
Government’s biggest mistake that has not led the housing market
or would-be purchasers to feel that HIPs are the right way
forward? Why is there such concern about them, and why was the recent
report so critical about the Department’s performance in putting
them
together?
Mr.
Wright:
I think the hon. Gentleman is referring to the
Select Committee report, which mentions HIPs. What I took from the
report was that we did not go fast enough, but that the policy of
improving transparency and helping first-time buyers and other
hard-working families in buying and selling houses was spot-on. It was
right to phase the policy in a turbulent housing market. The potential
judicial review from the Royal Institution of Chartered Surveyors meant
that we had to do something about home condition
reports.
4.45
pm
As
I have throughout my debates with the hon. Gentleman, I maintain
strongly that, in the turbulent housing market of the summer, with the
sub-prime problems across the Atlantic, Northern Rock, rising interest
rates and some uncertainty——which is important in housing
markets——it was absolutely right and proper that the
Government took a prudent approach and did nothing that would further
undermine confidence or jeopardise the stability of the housing market.
Much to the annoyance of the Opposition, the phased approach remains
robust in a turbulent world and has not been compromised as a result of
HIPs. The Europe Economics report showed that. We took the right,
considered, reasoned, pragmatic approach; we are not going to play fast
and loose with the housing market. That is what responsible Governments
do. In the recession of 1991-92, when the Conservatives were in office,
one in nine people lost their homes. We will never go back to
that.
Mr.
Robert Syms (Poole) (Con): The key point that my hon.
Friend made was that EPCs relate only to homes being sold, which leaves
95 per cent. without them. The key issue for debate is what we are to
do about the homes that are not on the market, many of which require
improved energy efficiency if we are to meet the 2050 targets by
reducing carbon emissions from homes.
Mr.
Wright:
That is a good point. EPCs need to be widened. We
had a good debate last week on sustainability certificates for new
homes and clauses 242 to 256 in respect of making the
provision of sustainability information mandatory as part
of the HIP.
I have gone
on longer than I intended. We have been round the houses on this. I
implore the hon. Member for Welwyn Hatfield to stop flogging this dead
horse and withdraw the amendment. To change my metaphor, the HIPs
aeroplane has taken off and is cruising at a steady altitude, the
stewardesses and stewards are bringing the drinks round, so I wish that
the Opposition would stop trying to cause a crash
landing.
Grant
Shapps:
Would not the Minister’s case be stronger
if he published the results of the £4 million trial? What does
he say to the comment of the right hon. Member for Greenwich and
Woolwich in respect of those whom the Government told they could earn
up to £70,000 a year if they trained as home inspectors,
as opposed to the domestic energy assessors who do EPCs? They should
have been carrying out home condition reports now. What is the
Minister’s message to people, who, in many cases, spent their
life savings on this project?
Mr.
Wright:
On the area trials, I have told the hon. Gentleman
many times, most recently on Wednesday, that when the process is
finished, I will write to him and place the report in the Library. I
cannot say fairer than that. The process needs to be taken to its
conclusion. That is reasonable and we have been round the houses on
that.
On the second
point, I know that HCRs are not mandatory and there is a case for
advertising their merits, but it is not as if we have abolished them.
There is still a strong case for them. I implore the hon. Gentleman to
withdraw the motion and ensure that HIPs, which are bedding in well and
not destabilising the housing market, but having the desired, positive
effect, can go on and do what we
intend.
Grant
Shapps:
I have listened carefully to the Minister, and as
he rightly points out, we have debated this on numerous
occasions—three separate occasions in Delegated Legislation
Committees—not least because of the way the Government
introduced the legislation in a hotch-potch fashion: hardly something
he can blame this Front Bench for, when it was his own Government who
produced these statutory instruments to debate the
legislation.
I
am still not hearing any answer to the question that has been hanging
over the Government’s implementation of HIPs all this time, and
that is, what on earth happened to the £4 million of public
money that was spent on trialling this HIP legislation? What is the
point of trials and pilots if it is not to test the results and publish
that outcome? Without that information, we are none the wiser as to
whether, in those trials, this worked or did not. The Minister has
never told us what the point of those trials was if it was not to
produce information that could be used as a basis to decide whether
this legislation should be pushed through in
full.
I do not think
there is a satisfactory answer to the question for those people who
trained as HIPs inspectors and spent £10,000 or £12,000
of their money, or even for those who thought there would be a lot more
work available as domestic energy assessors, having spent several
thousand pounds, when the work is not there. The fastest and easiest
way to ensure that the market is there for them would be to run with
new clause 5 and liberate the energy performance certificate so it
could be used much more widely, and not just when someone buys or sells
a house. I am not convinced by the Minister’s lack of arguments
and cannot therefore withdraw the
motion.
Question
put, That the clause be read a Second time:—
The
Committee divided: Ayes 4, Noes
11.
Division
No.
3
]
Blackman-Woods,
Dr.
Roberta
Smith,
Ms Angela C. (Sheffield,
Hillsborough)
Question
accordingly negatived.
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