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Lord Howell of Guildford: My Lords, we welcome the continuation of this committee in a new form, but I wish to make a serious point relating to the issue of the quorum which I should like the noble and learned Lord the Leader of the House to take back to his colleagues for consideration. Like the noble Lord, Lord Stoddart, I attended all the earlier committee meetings. Because the quorum for the committee is quite large and confined to Members of the other place, interruptions frequently arise. Indeed, on one occasion we had to abandon the meeting of the committee altogether which, after it had been planned a month ahead, was very tedious.

The problem could be solved by reducing the size of the quorum so that it would not be necessary to keep Members of another place there in such large numbers. It would be a simple move and is one that should be given some attention. In that way we could achieve uninterrupted attendance at the committee, which was successful and I hope will be as successful in the future.

Lord Williams of Mostyn: My Lords, I am grateful for that suggestion. It certainly offers one possible solution. A further long-term solution referred to by the noble Baroness, Lady Williams of Crosby, and the noble Lord, Lord Campbell of Alloway, is that if one had a Joint Committee, it is possible that the problem of the quorum could be solved in that way.

I undertake to do as the noble Lord, Lord Howell, has invited me: I shall bring this proposal to the attention of the Leader of the Commons. I know, too, that the noble Lord, Lord Campbell of Alloway, has very distinguished experience of serving on a Joint Committee when he was a Member of the Joint Committee on Human Rights, which avoided some of these difficulties.

For the moment, however, it is understood that this is a Commons committee which noble Lords attend but in which they do not participate any more fully than I have indicated. However, it seems to me that there is no reason why we should not have perfectly calm and rational discussions to see how procedures can be improved with the agreement of both Houses.

Lord Renton: My Lords, will the noble and learned Lord take the opportunity to have a word with the Leader of the House in another place so that he may tell the members of the committee that, although Members of your Lordships' House will not have a

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vote, there are among our Members far more people with experience and expertise of the relevant matters than can be found in another place?

Lord Williams of Mostyn: My Lords, I shall convey the message of the noble Lord, Lord Renton, in as tactful a way as possible.

Lord Stoddart of Swindon: My Lords, I was about to criticise the buck-passing which appeared to be taking place between the Lord Chairman of Committees and the Leader of the House, but of course the noble and learned Lord the Leader of the House has now accepted the buck and dealt with it very well indeed.

The only point I wish to emphasise is that Ministers really must treat Members of this House equally. I should like an assurance that they will do so.

Lord Williams of Mostyn: My Lords, as I said earlier, I shall transmit the concerns expressed by noble Lords to the Leader of the Commons. Perhaps the best course for me to follow is to enclose a copy of Lords' Hansard relating to these matters.

On the matter of the quorum, I think I can help a little further. In the committee on the convention, only Commons Members who were members of certain Select Committees could count towards the quorum. In the committee on the IGC, all MPs count towards the quorum, so it is reasonably possible that the problem of a failed quorum may be mitigated. However, I shall take these points forward. We can move on only by agreement, but I do not see why we should not look for a reasonable compromise on this issue.

Lord Waddington: My Lords, I do not want to hold up the proceedings for any longer than necessary. However, while listening to this discussion I have become increasingly concerned. It has highlighted the concern felt by many of us that this is a Commons committee. There seems to be no reason at all why it should not have been a Joint Committee, and the fact that it is not one seems to suggest that, once again, there is not a full realisation in the other place of the important role we play.

Bearing in mind the expertise in this House, I think it extraordinary that it was thought sufficient to have a Commons committee rather than a Joint Committee. I hope that the noble and learned Lord will press on his colleagues in another place our case for Joint Committees to be set up in the future.

Lord Williams of Mostyn: My Lords, the noble Lord has made a perfectly legitimate point and I was not derogating from the theme of his remarks simply by endorsing what was said by the noble Baroness. She pointed out that today we are dealing with the present circumstances: this is a Commons committee and therefore we have limited "rights".

I undertake to put forward all these points to the Leader of the Commons. However, I have to say that both he and Mr Cook, his immediate predecessor but

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one—his immediate predecessor was in place for too short a time to hold any meaningful discussions—have been extremely helpful and receptive to all proposals that I have put forward in the interests of this House.

On Question, Motion agreed to; and a message was ordered to be sent to the Commons to acquaint them therewith.

Local Government Bill

3.35 p.m.

Lord Rooker: My Lords, I beg to move that the Commons reasons and amendments be now considered.

Moved, That the Commons reasons and amendments be now considered.—(Lord Rooker.)

On Question, Motion agreed to.


[The page and line references are to HL Bill 43 as first printed for the Lords.]

3Clause 11, page 5, line 32, leave out paragraph (b) The Commons disagree to this amendment for the following reason—

3ABecause it would alter the financial arrangements made by the Commons, and the Commons do not offer any further reason, trusting that this reason may be deemed sufficient.

Lord Rooker: My Lords, I beg to move that the House do not insist on their Amendment No. 3, to which the Commons have disagreed for their reason numbered 3A.

I do not need to remind noble Lords that the Commons reason relies on the privilege of that House to determine matters relating to the financial arrangements of the country. That is only right and it is the principle on which relations between this House and the other place rest. However, we now have a further amendment before the House, Amendment No. 3B, which will be moved and spoken to by the noble Baroness, Lady Hanham, in due course. First, I beg the indulgence of noble Lords to make the following comments.

It will be apparent to anyone who reads this along with the previous amendment that the new amendment is designed to have the same effect as Amendment No. 3; namely, to remove the power of the Secretary of State to pool a proportion of housing capital receipts. As we all know, this is a vital issue which, over the past few months, has been discussed at some length at every stage in the proceedings of the Bill. It goes to the heart of the housing capital finance system.

To put it simply, Amendment No. 3B would remove the ability of central government to redistribute and allocate housing resources on the basis of need. It

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would put an end to this fundamental principle of capital finance, which of course was introduced by the previous administration and has been in place since 1990.

Without pooling, we would probably have to continue to operate a redistribution mechanism based on the principles underlying the current system. This could be only a partial solution. However, Clause 11, which we have been considering, introduces a system which is simpler, fairer and more transparent. I have used the word "fairer" quite deliberately because it would remove the unfair anomaly which exists at the moment. This anomaly gives special treatment and special benefits to one category of local authority in a purely arbitrary way. These are the authorities—around 40 of them—which are able, because of the mechanics of the system, to retain the housing capital receipts that arise in their area.

It is simply wrong that some authorities should have more spending power than others, regardless of housing need, simply because they happen to be rich in right-to-buy receipts or are debt-free. This is the fault of the present system which our pooling proposals address.

As noble Lords will know, I do not accept that the situation in which those authorities find themselves is the result of good financial management or good planning. It is neither of those. We are talking here about funds generated solely by the decision of tenants to buy their own house, not by any action of the local authority. And we are talking about a level of funding determined not through any assessment of need, but by the mechanics of the housing market, in particular in parts of the country where house prices are buoyant.

There is no justification on intellectual or moral grounds to exempt one category of authorities from their proper contribution to the country's housing need. It goes without saying that redistribution must apply to all if it is to be fair to all. Without it, affordable housing for key workers, decent homes and market renewal for low-demand areas would all be put at risk. Without redistribution, local authorities with debt, with lower capital receipts and with a greater housing investment need will lose out. That would disadvantage most of the nearly 260 authorities with housing stock.

Let me take at random five authorities which will be damaged by the amendment. Liverpool, Wigan, Milton Keynes, Solihull and Islington will all be worse off if the amendment is allowed to stand in the Bill.

There is a simple question before us today. Do we in this House accept that fairness in the allocation of funds should be paramount based on principle and transparency? Or do we believe that funding should fall where it arises, which of course is wholly down to an accident of history or geography?

Finally, I know that noble Lords have been concerned that the debt-free authorities will have made plans to use the receipts generated by their tenants. We recognise that—the point has been put very forcefully—and we have offered such authorities very generous transitional arrangements. This is the

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right response to the concerns of those authorities rather than removing the important new provisions that the Government initially proposed in the Bill. If in due course the matter should be pressed to a Division, I urge the House to reject Amendment No. 3B.

Moved, That the House do not insist on their Amendment No. 3 to which the Commons have disagreed for their reason numbered 3A—(Lord Rooker.)

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