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Baroness Gardner of Parkes: Perhaps someone could clarify for me whether this position would apply in a case where part of the premises were commercial. In Australia the significant difference occurs in the rates of insurance for a commercial part and a non-commercial part. If the insurance cover was for one complete building would it affect those in the residential part? Would residents have to pay more? Is this a case where the right to manage would not cover any property that included a commercial part?

Lord Falconer of Thoroton: The question asked by the noble Baroness, Lady Gardner, is one for the noble Lord, Lord Kingsland. I suggest an answer, and I will be corrected. The amendment reads:


22 Oct 2001 : Column 851

If, under the provisions of this Bill, there is a 25 per cent or less commercial element then, as I understand the amendment by the noble Lord, Lord Kingsland, the insurance policy that would apply would have to cover the whole building including the 25 per cent commercial part. Inevitably, that would have a financial consequence depending on the nature of the commercial activity. I stand to be corrected by the noble Lord, Lord Kingsland, but he is nodding enthusiastically.

I was sorry not to be involved in the Bill on the previous occasion, thereby missing what has become the legendary speech of the noble Lord, Lord Kingsland, on the single insurance policy issue. However, I agree that the points are clearly set out and that people know what the issues are. As the noble Lord, Lord Kingsland, will recall from Grand Committee, the Government wholeheartedly agree with the principle which lies behind the amendment, subject to the point raised by the noble Baroness, Lady Gardner, but we continue to differ on how to achieve it.

The amendment is in part concerned with ensuring that a block of flats is subject to a single insurance policy. We agree that that is normally desirable. As we said during the earlier Committee proceedings, a single policy will prevent unnecessary difficulties arising where the leaseholders need to call upon the insurance for reinstatement or repair. It is for that reason that we have brought forward our own provision to make the absence of such a policy a clear ground for application to vary a lease. That appears in the Bill at Clause 156(2).

The amendment is also concerned with ensuring proper value for money. Again, the noble Lord, Lord Kingsland, will know that we entirely support that objective. However, we believe that the right to challenge unreasonable service charges is the right way to deal with the matter. Furthermore, right-to-manage will make the leaseholders responsible for taking out the insurance policy which they then pay for. That in itself should create an incentive for value for money.

Finally, and most importantly, this amendment would impose a requirement on the right-to-manage company which it would not impose on any other manager. So far, nothing has been said to persuade us that such discrimination would be justified. Why, for example, is it appropriate for a "best value" requirement to be imposed on the RTM company but not upon the landlord? As has already been said, we believe that leaseholders should have the right to manage their block and we are firmly opposed to the imposition of requirements which make that right more onerous than normal leasehold management would be outside of that right.

Therefore, although we share in common much that underlies the amendment, we continue to oppose the amendment and I invite the noble Lord to withdraw it.

Lord Kingsland: I am sorry to have disappointed the noble and learned Lord the Minister by not repeating the speech I made on the topic in Grand Committee.

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If he would prefer me to repeat all the speeches I made on these topics in Grand Committee, I should be delighted to do so. However, I fear that that was not the invitation he intended to extend.

I thank the noble and learned Lord for his response. As he well knows from having carefully analysed my speech in Grand Committee--

Lord McIntosh of Haringey: The noble Lord, Lord Kingsland, should pay credit to the seamless nature of the Government Front Bench. I of course remember everything that he said in Grand Committee and I have communicated it at length to my noble and learned friend.

Lord Falconer of Thoroton: That is why I was so regretful not to have been involved in the previous Bill. The noble Lord's speech is legendary.

Lord Kingsland: I am grateful to the noble Lord, Lord McIntosh of Haringey, but I am somewhat incredulous after hearing what he said. Because I am so disappointed by the Minister's response to my amendment, I should like to test the opinion of the Committee.

5.24 p.m.

On Question, Whether the said amendment (No. 136) shall be agreed to?

Their Lordships divided: Contents, 70; Not-Contents, 130.

Division No. 1

CONTENTS

Alton of Liverpool, L.
Anelay of St Johns, B.
Astor of Hever, L.
Biffen, L.
Blatch, B.
Brooke of Sutton Mandeville, L.
Brougham and Vaux, L.
Buscombe, B.
Byford, B.
Campbell of Alloway, L.
Carnegy of Lour, B.
Cavendish of Furness, L.
Chadlington, L.
Cope of Berkeley, L. [Teller]
Cox, B.
Craigavon, V.
Crickhowell, L.
Cumberlege, B.
Dean of Harptree, L.
Denham, L.
Dixon-Smith, L.
Elliott of Morpeth, L.
Elton, L.
Flather, B.
Fookes, B.
Glentoran, L.
Goschen, V.
Gray of Contin, L.
Griffiths of Fforestfach, L.
Hanham, B.
Hanningfield, L.
Haslam, L.
Hayhoe, L.
Henley, L.
Howe, E.
Howe of Aberavon, L.
Howell of Guildford, L.
Jopling, L.
Kingsland, L.
Lyell, L.
McColl of Dulwich, L.
Monson, L.
Northesk, E.
O'Cathain, B.
Palmer, L.
Park of Monmouth, B.
Perry of Southwark, B.
Peyton of Yeovil, L.
Rees, L.
Roberts of Conwy, L.
Rotherwick, L.
Saltoun of Abernethy, Ly.
Seccombe, B. [Teller]
Selborne, E.
Shrewsbury, E.
Skelmersdale, L.
Soulsby of Swaffham Prior, L.
Stewartby, L.
Stodart of Leaston, L.
Strathclyde, L.
Taylor of Warwick, L.
Tebbit, L.
Trefgarne, L.
Vivian, L.
Waddington, L.
Wade of Chorlton, L.
Warnock, B.
Weatherill, L.
Wilberforce, L.
Wilcox, B.

NOT-CONTENTS

Acton, L.
Addington, L.
Ahmed, L.
Alli, L.
Andrews, B.
Archer of Sandwell, L.
Ashton of Upholland, B.
Bassam of Brighton, L.
Berkeley, L.
Bernstein of Craigweil, L.
Blackstone, B.
Boothroyd, B.
Borrie, L.
Bragg, L.
Brett, L.
Brooke of Alverthorpe, L.
Brookman, L.
Bruce of Donington, L.
Burlison, L.
Campbell-Savours, L.
Carter, L. [Teller]
Christopher, L.
Clark of Windermere, L.
Clinton-Davis, L.
Cohen of Pimlico, B.
Corbett of Castle Vale, L.
Crawley, B.
Dahrendorf, L.
Davies of Coity, L.
Desai, L.
Dixon, L.
Donoughue, L.
Dormand of Easington, L.
Dubs, L.
Eatwell, L.
Elder, L.
Evans of Parkside, L.
Falconer of Thoroton, L.
Farrington of Ribbleton, B.
Faulkner of Worcester, L.
Filkin, L.
Fyfe of Fairfield, L.
Gale, B.
Gibson of Market Rasen, B.
Gladwin of Clee, L.
Golding, B.
Goldsmith, L.
Goodhart, L.
Gordon of Strathblane, L.
Goudie, B.
Gould of Potternewton, B.
Graham of Edmonton, L.
Greenway, L.
Grenfell, L.
Grocott, L.
Hamwee, B.
Hardy of Wath, L.
Harris of Haringey, L.
Harris of Richmond, B.
Haskel, L.
Hayman, B.
Hollis of Heigham, B.
Hooson, L.
Howie of Troon, L.
Hoyle, L.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Irvine of Lairg, L. (Lord Chancellor)
Janner of Braunstone, L.
Jay of Paddington, B.
Jenkins of Putney, L.
King of West Bromwich, L.
Lea of Crondall, L.
Lester of Herne Hill, L.
Lockwood, B.
McIntosh of Haringey, L. [Teller]
McIntosh of Hudnall, B.
Mackenzie of Framwellgate, L.
Maclennan of Rogart, L.
McNally, L.
Maddock, B.
Mallalieu, B.
Marsh, L.
Mason of Barnsley, L.
Massey of Darwen, B.
Merlyn-Rees, L.
Morgan, L.
Morgan of Huyton, B.
Morris of Manchester, L.
Nicholson of Winterbourne, B.
Orme, L.
Patel, L.
Patel of Blackburn, L.
Paul, L.
Pendry, L.
Perry of Walton, L.
Plant of Highfield, L.
Prys-Davies, L.
Puttnam, L.
Ramsay of Cartvale, B.
Rea, L.
Rendell of Babergh, B.
Rennard, L.
Richard, L.
Rooker, L.
Scott of Needham Market, B.
Sharp of Guildford, B.
Shutt of Greetland, L.
Simon, V.
Slim, V.
Smith of Clifton, L.
Stone of Blackheath, L.
Symons of Vernham Dean, B.
Taylor of Blackburn, L.
Temple-Morris, L.
Thomas of Walliswood, B.
Thornton, B.
Tomlinson, L.
Uddin, B.
Walker of Doncaster, L.
Wallace of Saltaire, L.
Walmsley, B.
Warwick of Undercliffe, B.
Watson of Invergowrie, L.
Whitaker, B.
Wilkins, B.
Williams of Crosby, B.
Williams of Elvel, L.
Williams of Mostyn, L. (Lord Privy Seal)
Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.

22 Oct 2001 : Column 854

5.35 p.m.

Clause 96 [Functions relating to approvals]:


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