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Eight million people lack cavity wall insulation and 6 million lack roof insulation. If that is the situation, you cannot really blame the Government for trying to put right that which is patently bad. A recent United Nations report on climate change identified energy efficiency measures as crucial to reduce CO2 emissions. Reference has been made to the fact that we are under a stricture because we have to comply with EU regulations by a certain date. I hope very much that the Minister will take away from this debate the fact that millions of people, whether they know it or not, will benefit from legislation of this kind. Many noble Lords opposite have not suggested proposals to deal with the basic problem, as opposed to being negative. Tinkering with the issue has been suggested, as have incentives, and perhaps other ways of doing it. I hope that the atmosphere which is generated around the table by the main players in this matter will lead to the laying of the order, which we are promised by 1 August. That is not a long time away; it is two months. These things take time, as I demonstrated. It has taken 25 years to reach the present position.

Reference was made to the support, the lack of support, or the unanimity of the opposition to these proposals. However, it is not necessarily so. I have a list entitled the Directory of Home Information Pack Providers. It is a long list, including conveyancing and legal services, companies, estate agents, surveyors, search companies, finance houses, technology and others. It is not an extensive list or even large. To say that there is unanimity among the professions is nonsense. This matter is being used as part of a general stick with which to beat the Government, not just on this but on other issues.

I sincerely hope that the Minister will keep in mind the burning ambition that she and I share that the homes in which people live should be made as comfortable and as energy efficient as possible. I refer also to the terrible waste that occurs—£1 million every day is wasted in transactions which subsequently fail. Although a majority of noble Lords will vote on party lines against what she is doing, I hope that the Minister will take heart from that fact that she can use the period won in the past day or two to re-engage with anyone willing to support proposals to deal with the basic problem—that people are entitled to a decent home. Noble Lords talk about the costs. Well, I have been told that the cost will be between £350 and £400 per energy efficiency report. Given that the average cost of a house is nearly £200,000, that would be money well spent.

I say to the Minister and her colleagues: you have listened carefully so far, you should listen further to me and to others. All power to your elbow.

Lord Hanningfield: My Lords, I do not wish to say much. I am sure that we will have another debate. I wish to make two points, particularly in response to the noble Lord, Lord Graham. He referred twice to the £1 million a day wasted on home transactions. We all agree with that. He and others do not seem to understand that home information packs will not save money but are likely to add yet another £1 million to the costs of selling homes.

We estimate that some 600,000 sales are aborted each year, and that will not be prevented by home information packs. If the packs cost around £600 a piece, that represents around an additional £390 million on the cost of selling houses, an extra £1 million a day. Anyone who claims that they will save £1 million a day is talking rubbish; that is why we are against them. Given the need for affordable homes, the extra £1 million a day is unacceptable.

As my noble friend Lady Hanham and the noble Baroness, Lady Scott, said, we are all for the energy element of this legislation, particularly as regards the European directive—the House is unanimous on that—but we are against home information packs. They are a total waste of time and we need something different if we are to help the people of this country.

Lord Berkeley: My Lords, it is good to know that the noble Lord, Lord Hanningfield, agrees that £1 million a day is a reasonable estimate of the money wasted. The packs will cost money but they are to be produced on behalf of the seller. On average, every transaction involves three aborted attempts to purchase before there is a success—a 1:4 ratio. Whatever the costs—we could debate them for a long time—it would seem reasonable to suggest that there is £1 million a day of aborted work.

Part of the reason that the Royal Institution of Chartered Surveyors and other organisations have opposed these proposals so strongly is that they will probably lose that business of £1 million a day. The Government have opened up much of their work to competition, and professional bodies do not like competition. I am a member of the Institution of Civil Engineers, as is my noble friend Lord Howie. We value our professional qualifications and do not like competition, but we should have it, as should the RICS.

Noble Lords opposite say that everyone is against the proposal, but the only person who has spoken in this debate in favour of consumers—buyers and first-time sellers—is my noble friend Lord Graham. Those people, represented by my noble friend, should be listened to. Of course the professional organisations will say, “We are going to lose all of this money, it will be the end of the world and the quality will go down”, and so on, but there are many checks and balances. We should accept that the Government are trying to make this more accessible so that, when you buy a house, you do not have to commission four or five surveys for four or five different houses that you do not end up getting, in place of the one that should come with the home information pack.

I was struck by the amount of time and effort that we have spent in this debate complaining first that there are not enough inspectors and then that, when inspectors get their qualifications, there are not enough jobs for them. We cannot have it both ways. There are bound to be start-up problems, when there may be too many or too few inspectors, but I hope that my noble friend’s new timetable will sort that out. I wish this new timetable and the whole project very well.

6 pm

Baroness Deech: My Lords, perhaps I could try to dispel some of the ill tempered comments about the professions. My interest is that I used to teach property law, so I hope that I have sufficient detachment to see the effect of property law on buying and selling. We could, perhaps even starting in this House, change the law, but there are complications that cannot be overcome, because in recent years property law has been seriously affected by informal family and third-party rights—the rights of divorced wives or other people living in the house. Your Lordships will well know how complicated landlord and tenant law is. Unless one abandons all humanity, British land law will remain very complicated, so house sales will also be complicated, as others have said.

I want to make a few short points. The first is that, given the difficulties that I have described, there is now no point in the HIP in itself, if we leave to one side the energy performance certificate. It is unfair to say that the professions are trying to hog the matter for themselves. Bearing in mind the announcement this afternoon, I feel that there is nothing as dangerous as a half-dead animal, which will hit back and sting before it is finally dead. In the next few months, the situation will be, especially for first-time buyers, even more costly, stressful, complicated and deceptive.

Secondly, the energy certificate must be a good thing; indeed, it is an obligation. However, it still needs careful attention. As a member of the Merits of Statutory Instruments Committee, I received a great deal of most useful information, out of which a few points arose. It is hoped that the energy performance certificate will lead to savings in energy costs, but the cost of the certificate, which may be a few hundred pounds, will not be recovered for something like nine years; the financial outlay that buyers and sellers will have to make now will not be recovered for a long time, by when there will no doubt be other energy considerations.

Another point is that, if the certificate is to be provided every time the house is sold, in many cases this will be too often—that is, less than 10 years. However, some people do not sell their family home for 20, 30 or 40 years, in which case there will be no energy inducement; there will be no need to get a certificate and no need to think about energy improvements. Tacking on the energy certificate to house sale does not make sense.

Finally, I was not reassured in studying the material before the committee that there will be sufficient checks on those who make the energy inspection. I did not think that the qualifications and security issues attaching to those people who enter the house were sufficiently taken into account. There seemed to be no assurance that the accuracy and helpfulness of the energy certificate would be properly checked. In other words, the certificate might not be worth the paper it was written on, even if all the training goes forward; there is not yet sufficient infrastructure for that.

I therefore simply want to add my voice to those who have said that the home information pack should be abandoned and that the energy performance certificate should be taken forward, but in a way that focuses solely on saving energy and has nothing to do with buying and selling houses, which in English law, going back as it does 1,000 years or more, is complicated, but complicated for good reasons.

Lord Selsdon: My Lords, I rise to support the evergreen Minister in this Chelsea Flower Show week because I think that people have failed to understand that the Government really have tried. I want to refer to the debates that we had on this subject with the noble Lord, Lord Rooker. I spoke on that occasion too. He invited all of us to go to Committee Room 4, where he had the biggest bunch of officials that I have ever seen. They had been working on these issues for 10 years and were all good men and true. Then, suddenly, everything went wrong.

Frankly, we have a disaster on our hands today. There are 2,000 to 3,000 people with families who thought they were going to get jobs and genuinely set out to do something but are now regarded as a liability by the Minister, who said that we must do something with them. Why not? We also have a bunch of officials who have studied absolutely everything in this field. Therefore, there is an opportunity, and I congratulate the Minister on having done the right thing in a charming way, having announced that the Government are going to stop and think again. It is a case of going back to the drawing board.

I started my life in a drawing office, where, if you used too much Indian ink or spilt it on the tracing paper, you had to pay for a new sheet of paper. I was taught to work in cubic feet and metres but everyone else works in square feet and metres. Perhaps I am unusual in that. I should like to disclose, as I have already, my interests in this field. I was a director of a house-building company and also, for 20 years, a director of a company that manufactured baths, cookers, heaters, fridges and boilers—all the energy-consuming things. I had to worry about methane and learnt that the one thing to be concerned about was consumption and energy.

We sold baths in Germany and worked in a cast iron factory. The cast-iron baths were wonderful because they had high insulation, but it was the volume that counted—how much hot water went into the bath. I do not know whether the Minister knows the WETs concept of water and energy tests. It concerns water, waste water, energy and the environment, and is all tied in with the EU. If we bothered to think, we would say that these are important factors. The first issue concerns cubic feet or metres and the question is: what is the air volume of the house? It is not the number of beds that matters but the volume of air that has to be heated. What are the Btu or kilo-calorie values and how quickly does the heat transfer from one side of a wall to another, whether or not there is a cavity? One of the great advantages of flying freeholds is that other people are heating your house, and the idea now in terraced houses is to encourage the people around you not to insulate well so that you can steal their heat. Therefore, the volume of the air in a house is important rather than the number of bedrooms. If you are not careful, a four-bedroom house can take you into a higher tax band when you buy or sell.

The second question is: how many cubic feet or metres of water are consumed? Water is dispersed as waste water, carrying effluent with it, or it may have to be heated. So the questions are: what is the volume of the bath; how many people have showers; and what are the benefits? These issues will not go away, and the answer may be to go back to our earlier discussions.

When we debated the matter before, I suggested that we should agree a code of conduct or a code of practice on the information that should be provided by a willing seller to a willing buyer. We should have new WETs legislation to deal with all the factors. I do not want to correct noble Lords who said that things are better on the Continent but, at the moment, because there are rural areas throughout Europe, studies and tests have to be carried out on sewerage. People have to submit a return on the volume of water consumed, how environmentally friendly the system of disposal is, how the water can be reused or treated naturally and what worms must be present to digest the waste. Those issues will apply here as well.

With water shortages, we will have water consumption tests and, as consumption rises above a certain level, the charges will probably rise even further. We want to know the energy consumption of each house, and that information is readily available in gas and electricity bills, which show the number of British thermal units consumed. Again, the volume of water consumed is also important.

The insulation value is directly related to consumption of energy so you do not need all these people running around. But they are there, and maybe they could be used. Why do the Government not drop HIPs and move on to home improvement grants again? I exclude double glazing, which is not allowed in a listed building because of the light reflection on the windows outside. There are so many complications in our system that it would be better to make it simpler: get rid of the home information packs as they are now; agree a code of conduct with industry, which could be done rapidly because of the pressure that has been put on; and use the officials and those who have been employed to look at introducing and implementing new legislation relating to energy consumption, water consumption, waste disposal, sewerage and, of course, the disposal and reutilisation of home rubbish.

There is an opportunity for the Minister to take initiative. I would love to help her, It would be a waste of time to do nothing and complete folly to try to introduce HIPs.

Baroness Hamwee: My Lords, I should declare an interest as a solicitor, but I should say that I have no interest here in protecting my profession; my interest is in protecting the consumer. Reference has been made to so-called vested interests. Some interests may be vested but it is not appropriate to categorise all those who started out as stakeholders, as my noble friend said, as vested interests who are somehow on the wrong side. Certainly the view of the RICS changed from one of supporting the introduction of home information packs to opposing them because of the difficulties of which we are all aware.

I cannot help but smile wryly at the wrong expansion of the acronym, which has happened even today. Home information packs have been called home improvement packs—would that they were. A question that arises from my experience of observance at a distance of conveyances—I cannot tell one end of a Land Registry document from another—is that, in attempting to streamline the process, there has been, or has been thought likely to be, an increase in personal searches. In using modern technology and encouraging streamlining, does the Minister have any comment on how that might be addressed? Perhaps it is a rather boring point but it is quite important in the question of streamlining.

The Government acknowledged the importance of pilots, which I raised in a question following the Statement earlier. During the proceedings of the Housing Act 2004, we were at first told that it was not possible to pilot home information packs satisfactorily because the markets were not sufficiently localised. Then pilots were introduced, but—I have said this already today, but I will emphasise it—it is important that the results of those pilots are made public. When we debated HIPs last October, the Minister said that the Government,

That is a very important statement, which I would extend from home information packs to energy performance certificates. We must not lose those or lose sight of ensuring that there is public confidence in energy performance certificates.

The Statement referred to day-one marketing, and we understand that until the end of the year this will be permitted. This matter was taken up by my noble friend Lady Maddock with some energy, and by the noble Earl, Lord Caithness—until recently, day-one marketing without a home information pack was not on; now it is on but for seven months only. What factors are changing? Why can day-one marketing without home information packs be accepted up until the end of the year, when that will be reversed?

6.15 pm

Finally, on energy performance certificates, can the Minister—either today or, if it is too technical a question, following today’s debate but in a way we can all share, because it should be on the record—explain why it is not possible to proceed with energy performance certificates without home information packs? I suspect that it is technical and is to do with how the 2004 Act is framed. With the support expressed around the House for energy performance certificates, it is beginning to look more practical and less time consuming to go ahead with a bit of primary legislation to allow separate energy performance certificates, rather than have them caught up with HIPs which are now so controversial and lacking in support.

I confess to feeling personally almost let down; perhaps that is too strong. I started the debate on home information packs seeing a good deal of merit in the proposal. My confidence has ebbed as the years have gone on, and I am now sad that the Government have failed. Although we are to get new regulations, I see it as a failure. Eight weeks will certainly not put it right, nor allow us the scrutiny required after this sorry saga.

Lord Rosser: My Lords—

Lord Bruce-Lockhart: My Lords, I declare an interest—

Lord Davies of Oldham: My Lords, it is the turn of the government side, and then the Opposition.

Lord Rosser: My Lords, I continue to support the Government’s intention to reform the process of buying and selling houses. Under the current arrangements, a buyer enters into an undertaking to buy a property without having crucial information on the property from either the seller or the estate agent, who is being paid a fee to sell the property. The buyer, not having been given this crucial information, must then spend money on searches and copies of the deeds to find out whether the undertaking to buy at an agreed price is sound or not.

Logic suggests that those selling the property ought to provide all the necessary relevant information about it to a prospective buyer, rather than leaving them to find out key pieces of information at their own expense. Then, if the information they find leads them to withdraw from the purchase, they have incurred expenditure they cannot recoup and are, of course, no nearer to having purchased a property. If they are part of a chain, their decision to withdraw can lead to other transactions falling through, with expenditure incurred by other buyers being wasted. The reality is that £1 million is lost in aborted costs every day.

Of course, buyers have also spent money they cannot recoup if the seller withdraws after the expenditure has been incurred on searches and copies of legal documents, but before contracts have been exchanged. The groups that do not lose out under the present arrangements are those doing the searches and obtaining the documents, because they get paid for what they do irrespective of whether the sale proceeds. Indeed, if the sale does not proceed, they potentially do better, because any subsequent potential buyer will have to go through the same process of having searches undertaken, again at their own expense.

The Government intend to transfer the cost of searches and obtaining required documents from the buyer to the seller. This means that obtaining required documents only has to be done once on a property, avoiding buyers having to pay such costs—possibly more than once—and more than one search being undertaken on the same property. It also ensures that the person selling the property has an obligation to provide the necessary information which a buyer needs about the property for them to make a decision on whether or not to enter into a contract of purchase. Since the majority of sellers are also buyers, so they would secure the benefits when purchasing. The group that would stand to benefit most, since they are not sellers at the same time, would be first-time buyers when arrangements can be extended to them.

The information required in the home information packs which does not currently have to be obtained is, of course, the energy performance certificate. It is designed to improve energy efficiency through providing information about a property on the issue. What evidence there is suggests that the most likely time for energy efficiency improvements to be made is when a property changes hands. Energy performance certificates give homes an energy rating and, since more than 25 per cent of our carbon emissions come from our homes, addressing this point is relevant in acting against the threat of climate change. Information about energy efficiency measures that have or have not been carried out in a property, what the fuel bills are, how they can be reduced and how carbon emissions can be cut will encourage people to make energy efficiency improvements.

We should be aware of the declared goals of one of the organisations opposing the proposals. I was somewhat surprised to read a letter from the chief executive of the National Association of Estate Agents in one of the appendices to the report from the Merits of Statutory Instruments Committee. It stated:

that is presumably a reference to the improving of the home buying and selling process—

It is good to know the goals that drive the National Association of Estate Agents on this issue. They appear to have little to do with securing a better deal for its customers, although one has to say that there is evidence that by no means all estate agents share the view of the national association.

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