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Viscount Astor: My Lords, that is a very helpful comment from the Minister, but the Bill does not say that. Clause 2 says:

Perhaps the Minister would rather that the Bill did not say that, but that is what it says.

The noble Lord, Lord Thomas of Gresford, is entirely right. The only circumstances in which the Secretary of State would be forced to give a direction would be if there was a dispute with the authority. If there is a dispute, Parliament ought to know, because otherwise the Secretary of State will be able to give secret directions that nobody knows about. The public will not know about them, Parliament will not know about them and presumably the authority will not be allowed to publicise the situation.

That is an extraordinary state of affairs. The Minister has tried his best to defend the reserve powers, but he has failed to come up with any convincing reason why they are necessary or any convincing scenario in which they would be used. He has not proved his case. Unfortunately, the Minister has not even been able to say that he will take away the matter and reconsider it. In those circumstances, I must seek the opinion of the House.

1 Mar 2001 : Column 1496

8.50 p.m.

On Question, Whether the said amendment (No. 3) shall be agreed to?

Their Lordships divided: Contents, 28; Not-Contents, 53.

Division No. 3


Addington, L.
Alexander of Weedon, L.
Astor, V.
Blatch, B.
Bridgeman, V. [Teller]
Brougham and Vaux, L.
Byford, B.
Carnegy of Lour, B.
Cope of Berkeley, L.
Craigavon, V.
Cumberlege, B.
Ezra, L.
Goschen, V.
Hamwee, B.
Hanham, B.
Hayhoe, L.
Henley, L. [Teller]
Kingsland, L.
Lyell, L.
Mar and Kellie, E.
Monson, L.
Phillips of Sudbury, L.
Renton, L.
Russell-Johnston, L.
Sharp of Guildford, B.
Strathclyde, L.
Thomas of Gresford, L.
Tordoff, L.


Acton, L.
Alli, L.
Amos, B.
Andrews, B.
Archer of Sandwell, L.
Bach, L.
Bassam of Brighton, L.
Bernstein of Craigweil, L.
Billingham, B.
Borrie, L.
Brooke of Alverthorpe, L.
Brookman, L.
Burlison, L.
Carter, L. [Teller]
Chandos, V.
Clarke of Hampstead, L.
Cocks of Hartcliffe, L.
Crawley, B.
Davies of Oldham, L.
Dubs, L.
Elder, L.
Farrington of Ribbleton, B.
Faulkner of Worcester, L.
Filkin, L.
Gibson of Market Rasen, B.
Gould of Potternewton, B.
Grenfell, L.
Harris of Haringey, L.
Haskel, L.
Hilton of Eggardon, B.
Howells of St. Davids, B.
Hunt of Chesterton, L.
Hunt of Kings Heath, L.
Jay of Paddington, B. (Lord Privy Seal)
Layard, L.
Lea of Crondall, L.
Macdonald of Tradeston, L.
McIntosh of Haringey, L. [Teller]
McIntosh of Hudnall, B.
Parekh, L.
Ramsay of Cartvale, B.
Rendell of Babergh, B.
Rogers of Riverside, L.
Sawyer, L.
Shepherd, L.
Simon, V.
Symons of Vernham Dean, B.
Thornton, B.
Warner, L.
Whitaker, B.
Whitty, L.
Wilkins, B.
Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.

1 Mar 2001 : Column 1502

Lord Carter: My Lords, I beg to move that consideration on Report be now adjourned.

Moved accordingly, and, on Question, Motion agreed to.

Barclay's Group Reorganisation Bill [H.L.]

The Examiner's certificate that the further Standing Orders had been complied with ordered to lie on the Table and Bill committed to an Unopposed Bill Committee.

        House adjourned at nine o'clock.

Official Report of the Grand Committee on the Commonhold and Leasehold Reform Bill [H.L.]

Thursday, 1st March 2001.

1 Mar 2001 : Column CWH1503

The Committee met at four of the clock.

[The Deputy Chairman of Committees (Lord Murton of Lindisfarne) in the Chair.]

The Deputy Chairman of Committees (Lord Murton of Lindisfarne): Before we begin, I should remind your Lordships that if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung, and then resume after 10 minutes.

Clause 71 [RTM companies: membership and regulations]:

Lord Kingsland had given notice of his intention to move Amendment No. 109.

    Page 30, line 34, leave out subsections (1) and (2) and insert--

("(1) The persons who are entitled to be holders of "A" shares in an RTM company shall be qualifying tenants of flats contained in the premises.
(1A) Any person being--
(a) the landlord of the whole or any part of the premises (including mesne landlords), or
(b) a management company party to any lease of the premises or any part thereof,
who prior to the acquisition date had the right to manage the premises shall be entitled to be holders of "B" shares in an RTM company.
(1B) The acquisition date shall be the date on which the RTM company acquired the right to manage.
(1C) The paid-up capital of a "B" share in an RTM company shall be one pound and no person shall be required to hold more than one "B" share in an RTM company.
(1D) The holders of "B" shares in an RTM company shall have the right to appoint two directors to the board of directors of the company and the right on a requisition signed by a majority of them to call extraordinary general meetings of the RTM company.
(1E) The Secretary of State, after consultation with the National Assembly for Wales, shall (subject to section 70(2) and the previous subsections hereof) make regulations about the form and content of the memorandum of association and articles of association of RTM companies.
(2) Such regulations shall be laid before Parliament and shall be subject to an affirmative resolution of both Houses of Parliament.").

The noble Lord said: I believe that the first group of amendments has already been debated. My memories of the final half hour of the Committee's proceedings on Tuesday are somewhat hazy, so I may be mistaken.

[Amendment No. 109 not moved.]

[Amendments Nos. 110 to 111 not moved.]

1 Mar 2001 : Column CWH1504

Lord Kingsland moved Amendment No. 111A:

    Page 30, line 42, at end insert--

("( ) The appropriate national authority shall provide RTM companies with explanatory material setting out the responsibilities and risks associated with right to manage.").

The noble Lord said: I can deal with this amendment very briefly. The decision to exercise the right to manage should not be taken lightly. It is vitally important that the tenants are fully aware of the responsibilities they face in forming an RTM company. The amendment would ensure that the appropriate national authority provides clear information about the RTM and the potential risks associated with it. I beg to move.

Lord Williams of Elvel: I should like to speak to Amendment No. 111A moved by the noble Lord, Lord Kingsland. I should like to speak also to Amendments Nos. 125A, 128 and 133A. I do not propose--and nor does the noble Earl, Lord Caithness--to speak to Amendment No. 116, which covers a rather different point. We will take that amendment in its place on the Marshalled List.

Members of the Committee will be aware that at Second Reading I raised the point that people should not go into the management of premises unaware of the problems involved. At a previous stage of the Committee, the noble Earl, Lord Caithness, explained that he personally had been involved in the management of premises. I can say that I personally have been involved in the management of premises. Many years ago, I and eight other leaseholders took over the freehold of our property in South Kensington, and we tried to run it. We were totally unaware of the problems of running a property of that nature. We had to be instructed by lawyers that we had responsibility for civil liability. If a slate fell off the roof onto someone in the street, it was our responsibility. None of us knew that, and in the end we decided to sell the freehold on to a trust which already had a managing agent, simply in order to get a proper managing agent in control of the premises.

This is a subject of fundamental importance. I have received many letters on it as I am sure have other Members of the Committee. People cannot go into the management of premises without being aware of the problems involved. Whether it should be through the formula of the noble Lord, Lord Kingsland, or the formula that I and the noble Earl suggest, is a matter for debate. I accept that there are disadvantages with both formulae.

The amendment of the noble Lord, Lord Kingsland, would impose something of a burden on a national authority. As to my amendment, I recognise that there may be a chicken and egg situation in that you cannot have an invitation to participate without having a company, and you cannot have a company without an invitation to participate. Having said that, there are many ways around that chicken and egg problem. But

1 Mar 2001 : Column CWH1505

the principle must be right; anybody going into an RTM company and exercising the right to manage, must be aware of the problems involved.

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