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The amendment relates to Clauses 44 and 47 and the new redress and complaints-handling provision to be introduced in the energy and postal services sector and, potentially, in the water sector, after consultation in 2008. These aspects of the new framework for consumer representation and redress are an important part of the new arrangements introduced by the Bill. A direct consequence of the new provisions is that regulated providers in the energy and postal services sectorsand potentially water, after consultation in 2008will be required to take full and proper responsibility for handling complaints from consumers of their services.
As an incentive for industry to take complaint-handling seriously, the Bill requires regulators to make regulations prescribing standards for complaint-handling that will be binding on regulated providers in these sectors.
Where a regulated service provider has not been able to resolve a complaint to the satisfaction of the consumer, the availability of redress schemes will ensure that consumers will benefit from the certainty of a complaints resolution and the award of compensation where appropriate.
These measures are about empowering and protecting the consumer, and we are working closely with representatives of the key organisations concerned to ensure that we achieve a smooth transition to the new framework which maximises benefits to consumers and minimises the uncertainty for staff in the existing organisations.
We expect that the new sectoral redress schemes will be established by industry and approved by the relevant regulators. In parallel, regulators will also be considering how best to introduce the new standards for complaints-handling. We are discussing with both industry and industry representatives how best to make the transition to the new arrangements. From these discussions, it is clear that we face an intricate and challenging timetable to deliver the different aspects of this new structure, and that work on the detailed aspects of implementing these provisions needs to start now, even prior to Royal Assent. Therefore, we want to be able to make a start with building on the important background preparatory work which has taken place to facilitate the swift and successful introduction of these measures.
The intention behind the amendments is simple: to clarify expressly the status of certain actions, such as consultations and other procedural actions, and to provide that, where they are carried out prior to Royal Assent and commencement, they satisfy the requirements of the Bill as set out in Clauses 44(1) and 47(4).
In view of the time constraints on the implementation timetable, the amendments will enable us to make progress with implementation activities prior to the commencement of the relevant sections of the Bill, and provide the assurance that these actions will satisfy the obligations in the Bill specifically in these two areas. This will save a great deal of time later on in the process and assist with the swift introduction of these measures in due course. I beg to move.
Schedule 1, page 53, line 7, leave out from (b) to before and insert send a copy of the certified statement and the Comptroller and Auditor General's report to the Secretary of State, who shall lay them
Paragraph 32 of Schedule 1 places a requirement on the Comptroller and Auditor General to examine, certify and report on each statement of accounts received from the new National Consumer Council. Prior to this amendment, the Comptroller and Auditor General would have been required to lay a copy of each statement and the report before Parliament.
In discussions between the department and the National Audit Office it has been suggested that the requirement to lay copies of audited accounts and associated reports before Parliament should be the responsibility of the department rather than the Comptroller and Auditor General.
Under the amendment, the Comptroller and Auditor General will still be required to examine, certify and report on each statement of accounts received from the new council before sending a copy of the certified accounts and of the report to the Secretary of State. The Secretary of State will then be responsible for laying copies of the report before Parliament.Precedent has been set for this revised arrangement by other newly created bodies; for example, for Natural England, in the Natural Environment and Rural Communities Act 2006, and for the Olympic Delivery Agency, in the London Olympic Games and Paralympic Games Act 2006. The Secretary of State is responsible for laying the accounts of those two bodies. This amendment would bring the position of the new council into line with that of the other newly created bodies. I beg to move.
Baroness Hanham rose to move, That this House calls on Her Majestys Government to revoke the Home Information Pack (No. 2) Regulations 2007 (SI 2007/1667) and the Housing Act 2004 (Commencement No. 8) (England and Wales) Order 2007 (SI 2007/1668).
The noble Baroness said: My Lords, it is eight weeks since we last had an opportunity to debate the Governments proposals to introduce home information packs. Then, this ridiculous policy was having to be put on hold because of the wholly predictable fact that there were insufficient home inspectors trained to carry out either the home condition inspections or the energy performance reports. The Merits Committee had also issued a damning report on the whole project. The old regulations were withdrawn in May, new regulations were promised and laid in June, so here we are again.
The new regulations maintain the insistence that there should be a home information pack when a house is sold, but the requirement for it will be phased in, starting on 1 August for four-and-more-bedroom houses. Here lies the first recipe for disaster. How are four-bedroom houses defined? What is to stop an owner altering the rooms and selling the house on a different basis, say as having three bedrooms, a study and a playroom? That would not require a home information pack. Four-bedroom houses also amount to less than 20 per cent of the housing stock and are unlikely to be sought by the majority of first-time buyersthe people home packs are meant to help.
The pack itself has to contain an index, an energy performance certificate, title extract and a sellers form. That is all; everything else that a house buyer might need to know, such as the condition of the property, or information on warranties or policies to guarantee against defects, leasehold interests, rights of access, sewerage, drainage, water, gas or electrical services, may or may not be provided. If it is not, the buyer will still have to find and pay for it himself. The mangled mandatory pack is to cost in the region of £600, to be borne by the seller. It is blindingly obvious that this cost will find its way into the sale price of the property, so the buyer will pay for it anyway, as he will almost certainly have to do for an independent survey on the condition of the propertyone of a standard to satisfy him and his mortgage companyas well as the searches and all the documents for the sale.
Since we last spoke, the requirement to have a home information pack before a house could be put on the market has vanished. Now it will be sufficient just to have ordered a pack. But what buyer is going to sit around waiting for a pack to appear? At some stage, buyers will do what any buyer has always donecommission their own searches and documents in case the pack never appears, and pay for them.
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There is almost universal agreement on three points. The first is that the energy performance of a house is becoming an important piece of information. Under European law it will become a requirement to have that information in 2010, but it is unnecessary for a performance certificate to be attached to the sale of a property at this time. I am afraid that the Government have made up this aspect; they are gold-plating the directive, presumably to justify continuing with the packs. We believe that the requirement for the certificate could and should be detached from the home information pack and become a standalone requirement, carried out against the timescale of the directiveonce every 10 yearsand not, as currently, as not more than one year old on sale. This is not even particularly efficient. Delivery of energy performance certificates through home information packs will take about 15 years to assess the nations housing stock, whereas if, for example, energy companies were encouraged to deliver energy performance certificates out of their budgets for energy efficiency, the same result could be delivered in a far shorter time.
Secondly, since the first idea about having home information on houses at point of sale was considered, things have moved on. E-conveyancing is becoming a reality, the provision of seller disclosure forms is being considered, and the industrys various other initiatives to make house purchase and sale quicker and more efficient are really well under way and begin to make any suggestion of home information packs redundant. Their protracted introduction may have gingered up the professional organisations to think further about how to improve efficiency, but modern ideas are now taking off.
Thirdly, home information packs are a con. What is now on offer is a million miles from where the Government first started, when they were going to consist of comprehensive documentation, including a home condition report, which would mean that a buyer would have all the information required to make a speedy assessment of a property and a decision on a sale. Bit by bit, that has fallen apart. Home condition reports, once compulsory, have become voluntary. Insufficient inspectors have been trained to carry them out. Concern that they would not be of a standard to enable mortgage lenders to rely on them has still not been resolved. In all, the whole pack has unravelled.
Why are the Government persisting with this completely discredited policy? What is to be gained by continuing to pretend that it will benefit, in particular, first-time buyers and deter gazumping when every professional body, apart from those whose job it is to sell home packs, says that it will do neither? Why now justify these failed proposals on the only aspect of any valuethe energy performance certificatewhich is perfectly capable of being introduced on its own?
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Will the Criminal Records Bureau checks for those trained to be domestic inspectors be as stringent as those for home inspectors? It is reported today in the press that domestic energy inspectors will not be checked for previous convictions. If that is the case, it will be a disaster.
Seldom can a government initiative have gone so spectacularly wrong. It has been panned by practically all the professional bodies associated with house sales. Despite warnings from this House and the other place on innumerable occasions that the policy was simply not going to work, the Government have, none the less, ploughed on. This is the Ministers opportunity finally to admit that the policy is badly flawed, should be withdrawn and either rethought or abandoned. We will gladly support the introduction of energy performance certificates as a separate and freshly considered initiative, but home packs must go. I urge the Minister to do everyone a favourbuyers, sellers and professionalsand abandon the packs this afternoon. If she will not, I will ask the House to support my Motion against her. I beg to move.
Moved, That this House calls on Her Majestys Government to revoke the Home Information Pack (No. 2) Regulations 2007 (SI 2007/1667) and the Housing Act 2004 (Commencement No. 8) (England and Wales) Order 2007 (SI 2007/1668).(Baroness Hanham.)
Baroness Scott of Needham Market: My Lords, here we are again. It seems that for the past two years or so a debate on the latest saga on home information packs has become a regular feature of business in your Lordships House. The policy, which had some flaws when originally conceived and included in the Housing Act, has become worse. The Government, in a sense, have been a victim of being almost too obliging; by attempting to respond to many often conflicting pieces of advice from outside bodies, they have ended up with something less coherent and less consistent than it was when we started.
These Benches have always been ambivalent about home information packs, essentially on the basis that it was difficult to imagine that a buyer could have full confidence in information provided by the seller. That fundamental flaw always made us concerned about whether home information packs would be viable.
However, we have always supported energy performance certificates. They are a good way of helping householders to keep warmer, to save money and to reduce carbon emissionswe know that 20 per cent of UK carbon emissions come from domestic housing. It is a pity that the Government did not take stock at some point and concentrate on how best to
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I hope that the noble Baroness will address some of our concerns. First, on security checks, we have been told that domestic energy surveyors will not have to undergo as rigorous a criminal check as inspectors carrying out home condition reports. Can she confirm that and perhaps explain why different standards apply? Indeed, I understand that estate agents, who also have access to ones home, undergo no checks at all and that varying standards are required for utility inspectors. Perhaps the noble Baroness might consider whether there should be some consistency in approach, so that householders understand the background of the people whom they are letting into their home, particularly those whom they let in because they have to, as they have no choice about these inspections.
Will the noble Baroness update the House on the current standing of the judicial review, which was launched by the RICS some six or eight weeks ago? I know that the judicial review was put on hold in order to give the Government a chance to refresh their thinking. In a similar vein, could she tell us how the pilot studies are going? One of the points made by the Merits of Statutory Instruments Committee in its last report was that not enough information about the pilot schemes was being made public; it asked how we were therefore to make a judgment.
We are in a difficult situation because there is no doubt that the industry, in its broadest sense, needs some clarity on how the Government will progress. A rather fetching document from an estate agent came through the door of my London flat. It is called Getting HIP: The Low-down on the New Legislation. It says:
The Government cannot be happy that the industry is regarding the policy in that light. I am sure that the noble Baroness will want to assure the House that the Government are taking the situation very seriously and that they recognise that clarity within the industry is required.
As of 13 March, the Government had spent £11.6 million on developing the policy. A reply to a Written Question that I tabled in July said that an additional £8 million has been spent since then. The fact that almost £20 million has been spent on a policy that has not yet begun and which the industry really does not understand is not, I suggest, a great success.
The Earl of Caithness: My Lords, I congratulate the Government. It takes a huge amount of ingenuity to keep a grisly soap opera running for five, six or
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Our Merits of Statutory Instruments Committee is kept busy entirely as a result of the noble Baronesss department. For the second time this year, it has had to look at the package and, for the second time this year, it has had to report that the proposals will not achieve the policy objective in the way anticipated.
The noble Baroness, Lady Scott of Needham Market, referred to the home condition survey, which I am delighted is not in the home information pack. I did the training for it. I would never have relied, as a purchaser, on a house that had had a home condition survey, because the survey did not cover the really important things in a house, such as drainage, electricity and water. These were expressly excluded and one would have had to do a proper survey of ones own to cover those matters.
My noble friend Lady Hanham referred to people coming into homes with the right qualifications and the right security checks, but perhaps there is no need for that. Estate agents are in and out of peoples homes every day and they do not have to have any security checks. Anybody can set up as an estate agentany ex-prisoner, for example. The noble Baroness, when she loses her position at the next election, can set up as an estate agent the next day. We all trust her implicitly, but there are an awful lot of estate agents whom one does not trust at all.
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