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Lord Williams of Elvel moved Amendment No. 97:
- Before Clause 167, insert the following new clause—
The noble Lord said: My Lords, this amendment deals with the regulation of managing agents. In the original consultation document on the reform of residential leasehold law in November 1998, it was regarded as essential, and one of the key elements of successful reform, that there should be regulation of managing agents. The Government have not as yet brought forward any proposals to implement those conclusions.
The need for greater regulation of managing agents is recognised by all those involved in the leasehold sector, including the Association of Residential Managing Agents and, I am very happy to say to my noble and learned friend, the British Property Federation. It also includes the Royal Institution of Chartered Surveyors and others. Everybody says that this is the only effective way of implementing the right to manage proposals in the Bill. Many landlords are concerned that they may lose control of their investments by right to manage, not through any fault of theirs as owners, but through the inadequacies or the incompetence of the managing agents who then take over.
It seems to me that the Government's position is somewhat uncertain. I believe that they would like to see management of managing agents, but they are publicly committed to go out to consultation. The Government approve in principle, but have no clear view on how to proceed.
I say to my noble and learned friend that there is only one chance of primary legislation. There will not be another Bill of this nature by any normal parliamentary standards, in the next two or three years. So if we are going to deal with managing agents something has to be put into this Bill.
My amendment is essentially enabling. It states:
I go on to say that the whole business must be approved by the Secretary of State and that the rules, membership and disciplinary procedures should be equivalent to those of the Bar Council and the Law Society. The rules should be approved by statutory instrument which should be on an affirmative resolution.
I simply cannot believe that the Government will not accept this way of getting through the procedure. I very much hope that my noble and learned friend will have listened very carefully to what I have said and give himself and the Government the opportunity to move forward with something which they already want. I beg to move.
Lord Goodhart: My Lords, it seems to me that there is a great deal of sense in the proposals contained in the amendment of the noble Lord, Lord Williams, and I am happy to support it.
Baroness Gardner of Parkes: My Lords, I too support the amendment. I have spoken before in your Lordships' House about my September in Australia.
Lord Kingsland: My Lords, I endorse all that noble Lords have said, so far.
Lord Falconer of Thoroton: My Lords, that was put very seductively by everyone. The noble Lord, Lord Williams of Elvel, said that there would not be another legislative chance for two or three years. Our experience in every legislative Session for the past two years has been to produce a Commonhold and Leasehold Bill which has taken for ever.
My noble friend Lord Williams wishes to ensure that managing agents of leasehold property meet certain standards. We all agree with that. We also agree that standards in the profession are at present very variable and that some who describe themselves as managing agents do not deserve that name. We certainly wish that it were otherwise; that landlords and leaseholders could turn to any organisation which advertised itself as a managing agent, happy in the knowledge that they would receive a competent, honest and efficient service.
Sadly, however, I am not sure that there is a single profession in the kingdom, regardless of how long-established it may be or of what measures may be in place to safeguard its standards, of which that can safely be said. That indicates the difficulty of the task which my noble friend has set himself.
For our part, we do not believe that it would be wise to embark on any particular course for setting the residential property management business to rights without the fullest possible public discussion and consultation.
In principle, the objective which we share with my noble friend could be tackled in any one of a number of different ways. One approach would be to encourage the business itself to set up a body to regulate its own members. Indeed, in the interests of healthy competition, there would be benefit in having more than one such organisation, though that might be to hope for too much. Once such an organisation had been established and had achieved credibility, its agents would doubtless be chosen in preference to others. As it happens, I understand that the Association of Residential Managing Agents and the Association of Residential Letting Agents are in the preliminary stages of seeking to establish just such an institution.
At the other extreme, we could adopt some more formal regulatory scheme under which agents would need a licence to be allowed to practise, or could be banned from practising if they committed specific misdemeanours. The coverage of any of these arrangements would also need consideration: should they be confined to agents because the problems may instead be caused by the landlord or another person responsible for management?
The issues are complex and we have promised a consultation paper on them. That should be ready for publication early next year. Until the consultation process is complete, it would be premature for us to conclude that any particular approach is the right one. In the light of that explanation, I hope that my noble friend will agree to withdraw his amendment.
Lord Williams of Elvel: My Lords, I doubt whether my noble and learned friend has read the amendment. It states:
I find the attitude of not accepting a simple, enabling new clause strange. It does not impose a duty on the Secretary of State; it allows him to take certain actions. My noble and learned friend said that we have commonhold and leasehold legislation every two or three years. As an experienced Member of this House, I must tell him that we do not and it is unlikely that we shall.
Nevertheless, if that is the Government's position, they are missing an important and interesting trick. We may talk about the matter later, but in the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
"REGULATION OF MANAGING AGENTS
(1) After such consultation as he considers appropriate, the Secretary of State may by regulations provide for the establishment of a professional regulatory body for managers of property under this Part.
(2) The rules of the professional regulatory body shall be approved by him.
(3) The rules referred to in subsection (2) shall include provision for—
(a) a scheme of membership,
(b) standards for accreditation of members,
(c) procedures for complaints and disciplinary measures, and
(d) procedures for extending eligibility for membership to other managers of property.
(4) A statutory instrument containing regulations under subsection (1) shall not be made unless a draft of it has been laid before and approved by a resolution of each House of Parliament."
"After such consultation as he considers appropriate"—
it is up to the Secretary of State—
"the Secretary of State may by regulations provide for the establishment of a professional regulatory body for managers of property under this Part".
The amendment relates specifically to that Part. But the rules of such a body can be such as to extend the membership to people who are involved in the management of other properties. That gets round the problem that we cannot put something in this Bill which does not relate to the Bill itself.
"After such consultation as he considers appropriate".
It is then up to the Secretary of State to consult and I put no timetable on it. We are all agreed that something similar to a special regulatory body would be the right way forward. My noble and learned friend appears to believe that there might be a different approach; for instance, statutory licensing. I would
not choose statutory licensing and I am surprised that my noble and learned friend suggested that as a possibility.
13 Nov 2001 : Column 557House adjourned at twenty-five minutes past nine o'clock.
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