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Lord Mackay of Ardbrecknish: I should like to try to be helpful to the noble Baroness; I do not believe that there is a great deal of distance between us. As I indicated in my original contribution, we are currently reflecting on how we can use that power. I am not in a position to deliberate on the direction those reflections are moving. Therefore I cannot be more helpful, though I understand the noble Baroness's anxiety.

This is one of those issues where detail will be needed. It is a matter of balance. Although the noble Baroness gave us a case just on the other side of the balance, in fact many people not eligible for housing

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benefit have to make a judgment as to what they can afford and temper that against what they would like. Many people have to accept, if they are a couple, that it is economically wiser for them to take one-bedroomed accommodation.

All those matters must be balanced. I could ask the noble Baroness whether she would be content to pay housing benefit to the couple if they decided to move into a four-bedroomed flat in a pricey part of the City of Glasgow or the City of London? Of course not. It is that kind of detail which we need to address, accepting that there may be problems with which we have to deal in the regulations which we will be able to bring forward under the clause.

I am sorry that I cannot be more helpful. If I discover that the process of reflection has continued a little further at the Department of the Environment, I shall certainly write to the noble Baroness.

Lord Monkswell: Perhaps I may raise a problem for the Minister in the sense that he is suggesting that regulations can be made under Clause 158. My reading of the clause is that it refers only to persons being able to continue to occupy. There is no mechanism within it to determine what the requirements would be for someone looking for accommodation. It is not just someone who cannot continue to occupy a place because the rent has gone up or because his financial circumstances have deteriorated; it is also the situation where people are literally homeless and the local authority tells them they are not homeless because private rented accommodation is available. However, they do not have the money for the deposit and they cannot afford the rent. That is what the amendment attempts to sort out. If I have misunderstood the meaning of the amendment or the meaning of Clause 158, I am happy to be fully informed by the Minister.

Lord Mackay of Ardbrecknish: Perhaps it is my fault that in trying to make up examples I have led the noble Lord to the wrong conclusion. The clause is entirely about continuing to occupy the property; it is not about finding accommodation. We also have to take into account when reflecting on this matter that there is a considerable amount of existing case law which obviously has a considerable bearing on giving local authorities guidance.

Lord Monkswell: To rely on case law when we are now writing an Act of Parliament seems a rather curious way of trying to get out of the situation. We are in the process of producing a new Act of Parliament which will presumably supersede the case law built up on the basis of previous Acts of Parliament and the way courts have interpreted them. We are talking about a new law which will supersede and override previous case law.

Lord Mackay of Ardbrecknish: My understanding of these matters is that case law does not necessarily touch on one Act of Parliament and one Act only. It can be read across and it can be read backwards--not literally read backwards but one can look backwards to previous legislation and the case law that comes from

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it. That, in a way, is why case law is important. With the best will in the world, I do not believe that one can in Parliament legislate for every case. We try to lay down some principles, and case law, ministerial guidance and secondary legislation all have their part to play in the interpretation of those principles.

Baroness Hollis of Heigham: I wish to emphasise one point and then I shall seek leave to withdraw the amendment. The noble Lord speaks throughout as though somehow it is a tenants' market and that if tenants get a two-bedroom flat they can, if they are being realistic, shop around for a one-bedroom flat and get one. It is not like that. I do not know the position in any particular London borough but certainly in the part of the world I come from unfurnished rented accommodation at a reasonable rent that is salubrious and safe is like gold dust. If a recently married couple found a two-bedroom flat that was clean and affordable they would find themselves fortunate. The notion that somehow they can shop around and find a one-bedroom flat is simply not true. The Minister persists in believing that there is equity of bargaining power between tenant and landlord. There is no such thing. The bargaining power is all with the landlord, particularly when one talks about a young couple on income support. The Minister asked me rhetorically whether I would support a young couple going into a four-bedroom flat in Glasgow. If the alternative was being homeless and if there was not a realistic chance of a one, two or three-bedroomed place that they could go to then, yes, I would agree to it. That is the question: what is the supply of accommodation? What is it reasonable that they can seek and get, and can they afford it? If it cannot be afforded, then we need from the Minister an acceptance that that is a reason for saying that the couple have not made themselves intentionally homeless.

This is a very important issue for many young couples, particularly if their financial circumstances fluctuate, given the current state of the economy. We shall have to revisit this matter at Report stage. I hope that the Minister will have a slightly clearer idea that he can share with the House at the moment as to what the Government intend by financial accessibility. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

10 p.m.

Earl Russell moved Amendment No. 264AC:

Page 94, line 6, at end insert (",or
( ) it is so severely damaged by fire, flood, terrorist action or other cause that it is no longer fit for human habitation.").

The noble Earl said: I do not intend to speak to this amendment. I move it only in order to open up the group behind it. I beg to move.

Baroness Hamwee: That seems to be a hint for me to speak to Amendments Nos. 264CB and 264CC. The first of these amendments is intended to ensure that occupiers of unfit housing are dealt with in a fashion where they are accorded priority for rehousing. The amendment is to add a category to Clause 158 for those who are living in accommodation which the council

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itself has declared as unfit for anyone to live in. The fitness standard is in Section 604 of the Housing Act 1985. A house or flat will only be declared unfit if the council's own officers are of the view that it is not reasonably suitable for accommodation.

The amendment is intended to avoid the uncertainty which can arise if the council's housing officers certify that a property is not reasonable for continued habitation and designate it as unfit within the definition. Subsequently, when the occupier applies as homeless to the same council, the homelessness officers have to ask themselves whether that is accommodation which it would be reasonable to occupy. The amendment proposes a uniform test when unfit premises are being considered.

Although the second amendment deals with whether it is reasonable for a person to continue to occupy certain accommodation, the situation is rather different. I am proposing that it is accepted as not being reasonable to continue to occupy accommodation if possession proceedings have started, but the person has no defence against those proceedings. This is intended in part as a practical response to a not unusual situation. It is to avoid people who are threatened with homelessness having to go through the ordeal and expense of a court hearing in circumstances where they have no security of tenure and there is no defence against possession being granted. I mentioned costs. This provision will avoid costs generally being incurred and the landlord would claim costs against a tenant in such a situation. I hope also to reduce the load on the court in having to deal with possession orders where there can be no defence, and to save the time of a great many individuals. The current position is that many people are being forced to live in accommodation where there is no security of tenure. By definition, a characteristic of that is that the tenant has no defence against possession proceedings if the landlord takes such proceedings.

The department's own code of guidance on homelessness asks the following questions:

    "Has an applicant with no security of tenure left accommodation following a notice to quit...? Should an applicant have gone to court if it was clear to him/her that there was no defence against possession being granted? In these circumstances the authority should start to process the application and to make (if appropriate) arrangements to secure accommodation immediately".
I think that that explains the situation as quickly as I can and I shall not take up the time of the Committee in elaborating on it. My noble friend has moved his amendment, so I hope that that explanation of my amendments is clear.

Baroness Gardner of Parkes: Amendment No. 264CB might be the one on which I can hang the case that I want to raise with the Minister. I refer to the situation where a council is using accommodation in a hotel for many people, including homeless families, but the premises are in an unfit state. I do not know whether they qualify exactly under the categories listed by the noble Baroness, but on 25th April this year, the sub-lessee pleaded guilty to breaches of management

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regulations and was fined £32,000 plus £5,000 costs. Several statutory notices remain outstanding and works in default are being carried out by the council.

What concerns me greatly is that the council needs that accommodation. Something like 250 people live in that property--not all of whom are homeless--which the officer's report describes as "appalling". The council is advised that if it decides to apply for a compulsory purchase order simply because the landlord flatly refuses to do anything and the council is having to carry out some works in default, there is a strong possibility that it will be obliged to pay substantial compensation for the loss of business. The amount quoted is approximately £1 million.

It seems scandalous that a person running an unfit property and ignoring or refusing to comply with council orders then has the right to compensation. I wonder whether the Minister will consider introducing further provisions under this clause to cover such situations. It seems wrong that if the property is not run in accordance with the standards that are expected and necessary and if regulations and notices are simply flouted, the sub-lessee should then be entitled to claim massive sums of money in compensation, resulting in the council being unable to proceed to make the property fit for human habitation. I feel that that point relates to the amendments in the name of the noble Baroness, Lady Hamwee, although not specifically connected with them.

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