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Lord Lucas: My Lords, my noble friend asked three questions. He asked whether anything has changed since Committee. No, my Lords. He asked whether we will pre-judge the consultation which is taking place. No, my Lords. He asked whether we would have a meeting with him to discuss this. Yes, my Lords, I shall set it up tomorrow.

Lord Swinfen: My Lords, at last we appear to be getting somewhere, for which I am extremely grateful. I have not only raised the matter on this Bill, I have been raising it for a number of years in the House, as have other noble Lords. I am certain that honourable and right honourable Members in the other place have been doing the same. However, with my noble friend's assurance that he will set up a meeting, perhaps we will be able to move forward in that way. I know that it is not essential for the matter to be in the Bill because the powers are already on the statute book. Therefore, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 139 [Housing action trusts: orders for dissolution]:

Lord Dubs moved Amendment No. 174:

Page 82, line 11, leave out subsections (2) to (4) and insert--
("(2) In subsection (2)(b)(ii) omit "any person" and insert "the relevant local authority".
(3) In subsection (2)(b)(iii) omit "any person" and insert "the relevant local authority".
(4) After subsection (4) insert--
"(5) When determining the financial terms for any such disposal or transfer mentioned in subsection (2)(b) above, the Secretary of State shall have regard to ensuring that no local authority is financially disadvantaged.".").

The noble Lord said: My Lords, the amendment stands in my name and that of my noble friend Lord Williams. In moving it, I wish at the same time to speak to Amendment No. 175. The amendments are concerned with housing action trusts, and Amendment No. 174 in particular deals with the requirement that where property is transferred and the rights and liabilities remain with a housing action trust at its dissolution to the relevant local authority the Secretary

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of State should be required to consider how to avoid financial disadvantages from such a transfer. Amendment No. 175 is to ensure that property occupied by secure tenants is not disposed of or transferred using the amended dissolution procedure introduced by the clause.

The Government have on a number of occasions given undertakings that when housing action trusts are dissolved, assets should be transferred to the local authority but that the local authority should not have to bear the burden of any outstanding liabilities that those trusts incurred. The housing action trusts were introduced by Part III of the Housing Act 1988. At that time, the Government's White Paper said:

    "There are some areas of local authority housing, particularly in some of the inner urban areas, where social problems and housing disrepair are so serious that in the Government's view more direct action involving both public and private sectors is needed to obtain improvements over a reasonable timescale. The Government therefore proposes to take powers to establish bodies analogous to urban development corporations in designated areas to take over responsibility for local authority housing, renovate it and pass it on to different forms of management and ownership, including housing associations, tenant co-operatives and approved private landlords. These new bodies, to be known as housing action trusts, will provide scope for tenants in these areas to have a diversity of landlord and ownership. The HATs will have a limited lifespan. Their remit will be to secure the improvement of the stock transferred to them in their area and then to hand it over to other owners and managers".

As originally envisaged, HATs would have been established regardless of the wishes of the tenants in the local authority housing area affected. Subsequently, that was changed. To cut a long story short, when Sir George Young became housing Minister a different model of housing action trust was established, starting in 1991. That involved significantly improved levels of tenant consultation and involvement, including places on the board and an informal promise that tenants would be allowed to return to the local authority once the work of the HAT had been completed. So we are talking about undertakings given by the Government as regards the HATs that were then established.

With this amendment I want to achieve an easy transfer, and one from which a local authority will not incur any particular financial disadvantage. If that were to be the case, there could be a speedy transfer of HATs that were being dissolved to the local authorities. That is the proper way for such matters to be handled.

Property remaining with a housing action trust at the time of dissolution should be returned to the local authority in the area for a number of reasons. In most instances such property will originally have been in the ownership of the local authority. Therefore it is only right and proper that it should be returned to the local authority. Secondly, local authorities are clearly the most appropriate bodies to determine what part such a property should play in future housing provision for the area. Thirdly, and very importantly, local authorities are democratically accountable for the decisions they take. It is right and proper that housing action trusts should be returned to bodies that are elected and are democratically accountable to local people in the area.

As I said, it is important that no financial disadvantage should attach to the transfer of the property remaining with a HAT at its dissolution. If liabilities

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were to exceed assets it is right and proper that the local authority should be fully compensated for that. Indeed, Sir George Young said in the Commons at the Committee stage of what became the Leasehold Reform, Housing and Urban Development Act 1993:

    "It might be helpful if I were to make clear at this stage that government policy is that any such transfers will be at nil cost. The local authority will not be required to pay for the properties".
That is a very clear undertaking and the amendment seeks to give effect to it. I beg to move.

Lord Lucas: My Lords, Clause 139 amends the provisions for winding up housing action trusts, making clear that residual responsibilities can be passed to an existing body, such as a residuary body, set up to handle matters from several public bodies. But other arrangements, including transfers to local authorities, are not precluded. In particular, the clause does not affect the right of secure tenants of a trust to return to being tenants of their local authority if they so choose. Those secure tenants have a right to choose where they go to. So most of the assets of a trust in that form are going where the tenants want them to go.

In practice, trusts will not be wound up until they have disposed of most of their assets, including their housing and their liabilities. In all probability what will be left is a mix of miscellaneous liabilities for which someone must take responsibility but which do not justify prolonging a trust's life.

The amendments tabled by the noble Lord, Lord Dubs, seek to direct such residual matters to local authorities only and to exclude any secure tenancies from the wind-up process. In my view it would not be sensible to restrict our options in this way; nor would many local authorities be keen on arrangements that see them as sole recipients of a bundle of miscellaneous liabilities, whether on financially neutral or any other terms.

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We should retain flexibility to make wind-up arrangements that are best suited to the circumstances we find at the time--though I suspect that local authorities are a very convenient and apposite recipient for these liabilities in many instances. Accordingly, I invite the noble Lord not to press his amendment.

Lord Dubs: My Lords, I listened to what the Minister had to say. I would just make the point in relation to secure tenancies that Amendment No. 175 provides that,

    "Property which is subject to the provisions of this section shall not include dwellinghouses subject to secure tenancies".
I thought I had dealt with that point. However, it is late. I have heard the Minister's response and beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 175 not moved.]

Clause 141 [Orders, regulations and directions]:

Lord Lucas moved Amendment No. 176:

Page 83, line 14, after ("for") insert ("--
(a) orders subject to affirmative resolution procedure (see sections 103(5) and 104(4)),

On Question, amendment agreed to.

Clause 145 [Commencement]:

Lord Lucas moved Amendment No. 177:

Page 84, line 21, at end insert--
("( ) The Secretary of State may by order under subsection (3) make such transitional provision and savings as appear to him to be appropriate in connection with the coming into force of any provision of this Act.").

The noble Lord said: My Lord, I spoke to this amendment with Amendment No. 104. I beg to move.

On Question, amendment agreed to.

[Amendments Nos. 178 to 197N not moved.]

Schedule 2 [Architects]:

[Amendments Nos. 198 and 199 not moved.]

        House adjourned at thirteen minutes before eleven o'clock.

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