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Baroness Hamwee: I support the amendment as my name on the Marshalled List will show. I do so partly because I want to check on the position of local authorities in this matter. Local authorities are in a special position as regards VAT but, because this is a grant to an applicant and it is the applicant's payment of a bill, I assume that that special position for VAT purposes will not apply. If that is so, it is quite right that VAT should be taken out of the equation.

I realise that my point may be a little esoteric and that it may be one on which the noble Lord will wish to write to me unless he has some details in his brief relating to it. I believe that the proposal is a fair, practical and appropriate one, and I support it.

Lord Lucas: I wish immediately to dissociate myself from the aspersions which the noble Lord, Lord Williams, cast upon the VAT unregistered, many of whom I count among my closest friends. By and large I think they are as honourable as any other sector of the business community. That said, I share the noble Lord's concern that contractors who are required to submit estimates inclusive of VAT should not be disadvantaged in competition with smaller contractors who are not registered for VAT and who are able to provide lower estimates. However, as the noble Lord will realise, these matters are not simple because people who are not registered for VAT pay it and cannot reclaim it and therefore incur higher costs than people who are registered for VAT in some elements of their costs. It is not a simple equation. One cannot just take the 17.5 per cent. However, I shall give further thought to the matters raised and how best they may be achieved and will return to the noble Lord in one fashion or another before Report. With that assurance, I hope that the noble Lord will feel able to withdraw the amendment.

Lord Williams of Elvel: I am grateful for the fact that the noble Lord has grasped the problem. I am sure that his friends are very reputable but there are other people who are not so reputable. However, in the light of the assurance that the noble Lord and the department will look at the matter and that he will return to it in some fashion before the Report stage, I am happy to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 41 agreed to.

Clauses 42 and 43 agreed to.

Clause 44 [Change of circumstances affecting disabled occupant]:

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Lord Lucas moved Amendment No. 73:

Page 26, line 5, leave out ("its") and insert ("their").

The noble Lord said: I spoke to this amendment with Amendment No. 44. I beg to move.

On Question, amendment agreed to.

Clause 44, as amended, agreed to.

Clause 45 agreed to.

Clause 46 [Repayment where applicant not entitled to grant]:

Earl Ferrers moved Amendment No. 74:

Page 26, line 37, at end insert ("(or, in the case of a joint application, any of the applicants)").

The noble Earl said: King Lear appears again! In moving this amendment, I shall speak to Amendment No. 76. Amendments Nos. 75 and 77, in the names of the noble Lord, Lord Williams of Elvel, and the noble Baroness, Lady Hamwee, are also grouped with these amendments.

Amendments Nos. 74 and 76 allow the authorities to recover grant from joint applicants where any of the applicants are shown not to be entitled to grant at the time of application. Clause 46, as at present drafted, provides that in the case of a joint application the clause applies only where none of the applicants was entitled to grant; in other words, the authority can stop and recover grant.

The reason for bringing forward these amendments is that where one of the joint applicants is later discovered not to have been eligible for grant--for example, because he has too much money which he did not declare--the relevant means test assessment would have been wrong, with the likely result that too much grant would have been approved or paid. We believe that if that happens it ought to be possible to recover the grant, or any instalment of it which might have already been paid, in accordance with Clause 46(2). The application can then be re-determined. These amendments remove a potential loophole which would have prevented authorities from recovering grant where an applicant was shown not to have been entitled to grant. I hope that the Committee will agree that these amendments are an improvement to the Bill. I beg to move.

Lord Williams of Elvel: I am grateful to the noble Earl, King Lear, for explaining the government amendments. I would like to concentrate on Amendments Nos. 75 and 77 which are in this group. Amendment No. 75 is designed to ensure the recovery of grant aid where an applicant has withheld information or has given false information for the purposes of the means test. That is followed consequentially by Amendment No. 77 and the two together have the purpose which I have described.

Under the proposals in the Bill, owner-occupiers and tenants applying for renovation grant or disabled facilities grant, will be means tested by the local housing authority to determine what contribution, if any, they must make to the cost of the works. The amount of grant to be approved will be reduced, if necessary, following means testing in accordance with the regulations made by the Secretary of State.

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As I understand it, the same arrangements apply under the present grant regime. Where an owner occupier or tenant has been assessed by the Benefits Agency and is in receipt of income support, under the present regime he is passported through the means test by the local housing authority and will not make any contribution to the works eligible for grant.

Assuming that the same arrangements will apply under the proposed grant regime, provision needs to be made for situations where a person was wrongly in receipt of income support and should instead have been subjected to a means test. The proposed grant regime is intended to target limited resources at those most in need. We believe that enhancing the ability of local housing authorities to recover grant paid in excess of the amount to which the applicant was entitled will assist in maximising the use of limited resources.

I have no particular comment to make on the government amendments, but I would welcome a general response from the Minister on the problem that I have outlined when speaking to Amendments Nos. 75 and 77.

9.45 p.m.

Baroness Hamwee: I wonder whether either the Minister or the noble Lord, Lord Williams, will share with me and the Committee the roles in which they cast other Members of the Committee. I would not care to play some characters in King Lear.

Earl Ferrers: In answer to the noble Baroness, Lady Hamwee, I can say only that I was so enormously gratified to be elevated to the rank of King that I did not consider into what roles other noble Lords might be slotted. However, the noble Baroness need not worry her head about that; let her just think of me as a king and she will be all right.

The noble Lord, Lord Williams, said that he had no comment to make on my amendments. I thought that that was something of a brush-off because I thought that they were good amendments and I had hoped that the noble Lord would say that they were excellent amendments with which he could concur. The noble Lord did not say that, but I have said it for him. Perhaps, therefore, I may now turn to his amendments, Amendments Nos. 75 and 77, which he was good enough to describe.

Amendment No. 75 seeks to enable Clause 46 to be applied to the situation where an applicant was not entitled to a grant of the amount which he was awarded but may have been entitled to a grant of a different amount. Clause 46 as it stands applies only to the situation where an applicant was not entitled to any grant. On the face of it, therefore, the amendment seems to cover a situation which is not covered in the Bill and which could be desirable. I should like to consider that point and to deliberate on precisely what the Bill should say on that matter.

Amendment No. 77 enables the authority to stop and to recover payment of the excess grant where the applicant deliberately has given false information or withheld information in order to gain the excess grant.

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In our view, if Clause 46 were to be amended as the noble Lord suggests, an authority would be empowered to stop and recover the excess grant by virtue of the provisions in the remainder of the clause. So far as concerns the specific situations which this amendment covers--deliberately giving false information or withholding information--common law remedies ought no doubt to be able to be relied on. Also, the amendment appears to cover much of the ground already covered by subsections (2) to (6) of Clause 46. Therefore, on the face of it, Amendment No. 77 may be unnecessary.

I should like to give further thought to both of those amendments and, if appropriate, I shall return to the matter on Report. I hope that that will satisfy the noble Lord. I know that he is easily satisfied and I know of no reason why he should not be satisfied with that reply.

Lord Williams of Elvel: I am most grateful to the noble Earl. I am easily satisfied by ministerial announcements that the Government will consider my amendments and return on Report with, we hope, their own appropriate amendments to the Bill. I am grateful to the noble Earl for taking on board those important points and, in the light of what he said, I do not intend to move my amendment.

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