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Clause 297 - Certain family intervention tenancies: termination

824.     This clause makes provision in relation to the termination of local housing authority family intervention tenancies.

825.     Subsection (1) provides that a local authority should not serve a notice to quit on a tenant of a family intervention tenancy unless a notice under subsection (2) has been served on the tenant and either:

  • the tenant has not requested a review of the kind specified in the notice (right to request, within 14 days of the service of the notice, a review of the authority's decision to evict);

  • the tenant withdraws the request for a review; or

  • a notice under subsection (4)(b) has been served on the tenant (notice of the reasoning and decision of the requested review).

826.     Subsection (2) sets out the required contents of the notice.

827.     Subsections (3)-(4) explain what a local authority must do if a tenant requests a review of the local authority's decision within 14 days of the service of the notice under subsection (2). The local authority must carry out the review and serve notice of their decision and the reasons for it on the tenant.

828.     Subsection (5) provides that an "appropriate authority" (i.e. the Secretary of State for England or the Welsh Ministers for Wales) may make regulations about the review procedure.

829.     Subsection (6) provides that regulations made under subsection (5) may contain:

  • a description of the person who makes the review decision;

  • the circumstances under which the tenant would be entitled to an oral review;

  • whether or not and by whom the tenant can be represented during the review hearing.

830.     Subsection (7) provides that any notice to quit or notice under subsection (2) served in respect of a family intervention tenancy, must also contain advice to the tenant about obtaining assistance in relation to the notice.

831.     Subsection (8) provides that an "appropriate authority" (i.e. Secretary of State for England or the Welsh Ministers for Wales) may make regulations on the type of advice the notice to quit or notice under subsection (2) must include.

832.     Subsection (10) effectively applies the provisions of this clause only to tenancies granted after the coming into force of this section.

Possession orders

Clause 298 - Possession orders relating to certain tenancies

833.     Clause 298 introduces Schedule 10.

Leasehold enfranchisement

Clause 299 - Right to acquire freehold: abolition of low rent test

834.     Clause 299 amends section 1 and repeals sections 1A(2), 1AA and 4A of the Leasehold Reform 1967 ("the 1967 Act"). These amendments have the effect of removing the low rent test contained in Part 1 of the 1967 Act as a means of determining eligibility for enfranchisement in relation to shared ownership houses.

835.     The low rent test will remain for some purposes, for example, in determining the basis for valuing the freehold and when the claim is for a lease extension.

836.     The test will continue to apply in respect of existing leases.

Clause 300 - Shared ownership leases: protection for certain leases

837.     Schedule 4A to the Leasehold Reform Act 1967 provides for the exclusion of certain shared ownership leases of houses from the operation of Part 1 (the enfranchisement provisions) of that Act. Clause 300 inserts paragraph 3A into Schedule 4A. Paragraph 3A sets out the conditions that must be satisfied in order for a shared ownership lease granted by a landlord, other than a housing association, to be excluded from the operation of Part 1.

838.     The conditions are similar to those that apply in relation to shared ownership leases granted by housing associations, but additionally the appropriate national authority (being the Secretary of State in England, and the Welsh Ministers in Wales) may prescribe other conditions that must be satisfied or prescribe exemptions.

839.     The clause gives to non-housing association the same protection against the risk of enfranchisement as is afforded to housing associations. In particular, the provisions can be used to prevent a tenant from acquiring the right to enfranchise before the tenant has acquired 100% of the equitable interest in the house.

840.     The amendment will not apply to leases granted prior to the commencement of the clause.

Clause 301 - Shared ownership leases: protection for hard to replace houses

841.     Clause 301 inserts paragraph 4A into Schedule 4A to the 1967 Act. The effect of paragraph 4A is that shared ownership leases granted by any provider that are not excluded from the operation of Part 1 of the Act by virtue of either paragraph 3 or 3A of Schedule 4A (because they do not comply with the conditions set out in either of those paragraphs) will nevertheless be excluded from the operation of Part 1 if they are situated within an area that is designated as a protected area and if they satisfy all the other requirements set out in paragraph 4A. The appropriate national authority (i.e. the Secretary of State in England, and the Welsh Ministers in Wales) has power to prescribe additional conditions that must be satisfied.

842.     The appropriate national authority is also given power under paragraph 4A to designate an area as a protected area where it considers it is appropriate to do so to support the provision in the area of houses, or types of houses, which are available for occupation in accordance with shared ownership arrangements. The appropriate national authority must publish the criteria which will be taken into account by it in deciding whether to designate an area as a protected area, and must consult those likely to be affected by the designation.

843.     Subject to the conditions in paragraph 4A being satisfied, this provision will allow any provider of shared ownership housing to grant leases that restrict the percentage share of the house that the tenant may acquire, and may also prevent the tenant from acquiring the freehold interest, if the house is in an area that has been designated as a protected area.

Service charges

Clause 302 - Service charges: provision of information and designated accounts

844.     Clause 302 introduces Schedule 11 in relation to the provision of information about service charges and designated accounts.

Right to buy etc: miscellaneous

Clause 303 - Exclusion of the right to buy: possession orders

845.     Clause 303 clarifies the circumstances where section 121(1) of the Housing Act 1985 applies so that a tenant subject to a possession order cannot exercise the right to buy, ensuring that these include a possession order which does not initially specify a date for possession.

Clause 304 - Exclusion of the right to buy: demolition notices

846.     Clause 304 introduces Schedule 12.

Clause 305 - Review of determination of value

847.     Section 128 of the Housing Act 1985 ("the Act") provides that where a tenant who has applied for the right to buy is dissatisfied with the valuation provided by his landlord under section 125 of the Act, he may ask the district valuer (an officer of the Valuation Office Agency, a non-profit-making public body) for a determination of value. Clause 305 inserts new sections 128A and 128B into the Act to enable a district valuer, either at the request of the landlord or the tenant or on his own initiative, to review a determination of value which appears to have been based on faulty facts. A request or decision to review the original determination must be made within specified time limits, be in writing and set out the reason it is being made. A review may not be undertaken after the sale of the property has been completed. The specified time limits run from the date the landlord serves a notice on the tenant informing him of the determination under section 128. The district valuer will not know when such a notice has been served so provision is made to ensure that the district valuer is made aware of the service of the notice.

Clause 306 - Approved lending institutions

848.     If a tenant buys his home under the right to buy and then resells it within five years, his former landlord may require him to repay some or all of the discount he received. This obligation is secured by a charge on the property. Usually a right to buy purchaser will rely on a loan by way of mortgage, and the lender will also protect the loan by a charge on the property. Charges are ranked chronologically, and the landlord's charge would take precedence over the lender's. However, if the lender is one of those specified in section 156 of the Housing Act 1985 or approved by the Secretary of State under that section ("approved lending institutions") their charge may take precedence over the discount charge - i.e. they have the first charge on the property, giving them the best security for their loan.

849.     Clause 306 removes the Secretary of State's powers under section 156 to specify bodies as approved lending institutions and to revoke that status. The clause instead adds "authorised mortgage lenders" to the list in section 156(4) of automatically approved lending institutions. It also adds a definition of authorised mortgage lenders to section 622 of the 1985 Act. These are (i) bodies which are authorised by the Financial Services Authority (FSA) and (ii) European lenders automatically entitled to operate in the United Kingdom. The overall effect is to combine the process of approving lenders for right to buy purposes, currently carried out by the Secretary of State, with the process of authorising lenders carried out by the FSA. "Authorised insurers" and "authorised deposit-takers" are also automatically approved lending institutions under section 156(4) of the Act, and clause 314 (see below) amends the definitions of those bodies in section 622 of the Act to conform with the definition of authorised mortgage lender.

Clause 307 - Former right to buy flats and other flats: service charge loans

850.     Clause 307 amends section 450C of the Housing Act 1985 to add a power for the Secretary of State (in Wales, Welsh Ministers) to make regulations allowing landlords, where they make loans to leaseholders to assist them in paying service charges, to do so on terms other than an interest bearing loan. A power is included to provide for charging for the services of the district valuer, since it may be appropriate to specify valuation of the flat by a district valuer in regulations. Fees charged by the district valuer are limited to recovery of expenses, and are governed by usual administrative law principles of reasonableness. Provisions for service charge loans under regulations made under the powers in sections 450A to 450C of the Housing Act 1985 apply only to properties sold under the right to buy.

Clause 308 - Former right to buy and other flats: equity share purchases

851.     Clause 308 adds a new section 450D to the Housing Act 1985. This provides that the appropriate national authority may provide by regulations that where a local authority is the landlord of a flat let on a long lease to a tenant (commonly known as a leaseholder) who is liable to pay service charges in respect of repairs or improvements to the flat, the landlord may, with the tenant's agreement, buy an equitable interest (i.e. a share) in the flat in order to help the tenant to pay service charges. The regulations may provide that this power is not available to specified types of landlords, and also how the purchase price is to be calculated (including provisions in respect of discounts, charges for the services of district valuers, and the tenant's liability for the landlord's administrative expenses in connection with the purchase). Fees charged by the district valuer are limited to the recovery of expenses and are governed by usual administrative law principles of reasonableness.

Clause 309 - Other amendments

852.     Clause 309 corrects two errors in schedules to the Housing Act 1985 ("the Act"). The first correction, to Schedule 5 to the Act, removes an unintended right of further appeal to the High Court against the decision of a residential property tribunal, where tenants who have been refused the right to buy on the ground that the property is particularly suitable for occupation by elderly persons have appealed to a residential property tribunal. It was intended that the tribunal's decision should be final; further appeal to the Lands Tribunal is already excluded. A possible right of further appeal to the High Court was inadvertently suggested by interaction between Schedule 5 and section 231 of the Housing Act 1996. The second correction amends a paragraph reference in Schedule 5A to the Act.

Other

Clause 310 - Disposals of dwelling-houses by local authorities

853.     Clause 310 introduces Schedule 13.

Clause 311 - Financial assistance for information and other services

854.     Clause 311 widens the existing power contained in section 94 of the Housing Act 1996 for the Secretary of State in England and the Welsh Ministers in Wales to provide financial assistance for the giving of general advice in respect of residential landlord and tenant law, including advice about estate management schemes in connection with enfranchisement.

855.     Financial assistance may now also be provided for the giving of information and training, and for the running of an alternative dispute resolution service.

856.     The ability to provide assistance in such form and on such terms as the Secretary of State in England and the Welsh Ministers in Wales consider appropriate will remain.

Chapter 3 - Housing finance and other provisions

Housing Revenue Account Subsidy

857.     These provisions provide a power for the appropriate person (the Secretary of State in England and Welsh Ministers in Wales) and those local housing authorities who keep a Housing Revenue Account to enter into agreements concerning Housing Revenue Account Subsidy. This enables the parties to agree that no Housing Revenue Account Subsidy is payable by or to the appropriate person. Agreements can be for either an authority's whole stock or for specified properties.

Clause 312 - Exclusions from subsidy arrangements

858.     Subsection (1) inserts a new section 80B into the Local Government and Housing Act 1989 (the 1989 Act) which by virtue of subsection (2) of section 80B disapplies sections 79 to 80A of the 1989 Act where an agreement exists between the appropriate person (the Secretary of State in England and Welsh Ministers in Wales) and a local housing authority. An agreement disapplying sections 79 to 80A would have the effect that no Housing Revenue Account Subsidy was payable by or to the appropriate person in respect of the properties covered by the agreement.

859.     Subsection (3) of section 80B gives examples of the kinds of terms and conditions that such agreements may contain. These include conditions specifying whether the agreement is to be for a fixed or indeterminate period, setting out the payments to or from the appropriate person for making the agreement, rent levels, the giving of information and the variation or termination of the agreement.

860.     Subsections (4), (5) and (6) of section 80B enable the appropriate person to make directions concerning the variation or termination of an agreement to deal with issues such as necessary transitional, consequential, incidental or supplementary changes. Directions cannot, however, override the terms of the original agreement without the consent of the relevant local housing authority. Directions may in particular deal with the return to the subsidy regime of an authority's housing stock.

861.     Subsection (8) of section 80B defines key terms used in that section. In particular the definition of property ensures that the agreement can cover both current and future properties.

862.     Subsection (3) amends paragraph 2 of Part 3 of Schedule 4 to the 1989 Act which currently provides authorities a very limited power to move credits from their Housing Revenue Account to the general fund, so that it does not apply in respect of those properties subject to an agreement under section the new 80B(1)(b).

Homelessness and allocation of housing

Clause 313 - Armed forces: homelessness and allocation of housing

863.     Clause 313 amends section 199 of the Housing Act 1996, which sets out the circumstances when a person has a local connection with the district of a local housing authority. Housing authorities may take account of whether a person has a local connection with their district when considering the person's priority for an allocation of housing under Part 6 of the 1996 Act or when making inquiries about whether the person is homeless and owed a duty for the purposes of Part 7 of the 1996 Act. The effect of the amendment is that a person in the armed forces will now be able to establish a local connection with a district through residence or employment there, in the same way as a civilian.

Other

Clause 314 - Amendments to Housing Act 1985: lending institutions

864.     Clause 306 removes the Secretary of State's powers under section 156 of the Housing Act 1985 to specify bodies as approved lending institutions and to revoke that status. It instead adds "authorised mortgage lender" to the list in section 156(4) of automatically approved lending institutions. "Authorised mortgage lender" is defined in section 622 of the 1985 Act as (i) bodies which are authorised by the Financial Services Authority (FSA) and (ii) European lenders automatically entitled to operate in the United Kingdom. Clause 314 amends two definitions in section 622 of the Housing Act 1985, those of 'authorised deposit taker' and 'authorised insurer', to bring the wording into conformity with the definition of "authorised mortgage lender", in each case by substituting a reference to paragraph 12 of Schedule 3 to the Financial Services and Markets Act 2000 instead of to paragraph 12(1) of that Schedule.

Clause 315 - Building regulations: time limit for prosecutions

865.     This clause amends section 35A of the Building Act 1984 to extend to all provisions of building regulations longer time limits for bringing prosecutions for contraventions of those provisions. At present the longer prosecution time limits provided for by section 35A can apply only to contraventions of provisions of building regulations which were made for the purpose of furthering the conservation of fuel and power or otherwise in connection with the use of fuel and power, or for the purpose of reducing the emission of greenhouse gases, where those provisions have been designated in regulations.

866.     The current time limit within which prosecutions for breaches of provisions of building regulations must be brought is six months from the date the offence is committed (in accordance with the standard provisions for summary offences set out in section 127(1) of the Magistrates' Courts Act 1980). The amendments in this clause will bring prosecutions for all building regulation contraventions within the time limit provisions in section 35A. Thus there will be an absolute limit of two years from the date the offence is committed within which summary proceedings must be commenced, subject to a requirement that proceedings must be brought within 6 months of the date on which sufficient evidence to justify a prosecution becomes known to the person who commences the proceedings.

867.     Subsection (5) provides that the extended time limits for prosecution will not apply to any offence committed before the amendments to section 35A come into force, i.e. the amendments will not be retrospective.

Clause 316 - Protected mobile home sites to include sites for gypsies and travellers

868.     Clause 316 amends the definition of a "protected site" in section 5(1) of the Mobile Homes Act 1983 by removing the exclusion for land occupied by a local authority as a caravan site providing accommodation for gypsies and travellers. The Mobile Homes Act 1983 will therefore apply to an agreement to station a mobile home (or caravan) on a local authority gypsy and traveller site.

Clause 317 - Financial assistance for certain services about commonhold

869.     This widens the existing power contained in section 62 of the Commonhold and Leasehold Reform Act 2002 for the Lord Chancellor to provide financial assistance for the giving of general advice in respect of the law relating to commonhold land so far as relating to residential matters.

870.     The Lord Chancellor may now also fund information, training and dispute resolution services in respect of the law of commonhold land so far as relating to residential matters.

871.     Additionally, financial assistance for the provision of information, training, general advice and dispute resolution services may now be given in respect of any other matter relating to commonhold land and residential matters.

872.     The ability to provide financial assistance in such form and on such terms as the Lord Chancellor considers appropriate will remain.

PART 4 - SUPPLEMENTARY AND FINAL PROVISIONS

Clause 318 - Orders and regulations

873.     Clause 318 makes general provision for orders and regulations under the Bill. It provides for regulations and orders to be made by statutory instrument except where specified otherwise (subsection (2)) and for the Parliamentary procedure which is to apply in respect of various instruments (subsections (3) to (7)).

874.     Subsections (6) and (7) provide for the procedure to be followed in the National Assembly for Wales in relation to instruments made by Welsh Ministers.

Clause 319 - Consequential amendments and repeals

875.     Clause 319 gives the Secretary of State power by order to amend, repeal or revoke enactments in order to make supplementary or consequential provisions for the purpose of giving full effect to the Bill. Subsection (4) enables Welsh Ministers to make consequential amendments and repeals in relation to matters where functions are exercised by Welsh Ministers. This clause also introduces Schedule 14.

Clause 320 - Transitional, transitory or saving provisions

876.     Clause 320 enables the Secretary of State by order to make such transitional, transitory or saving provisions as are needed in connection with the coming into force of the Bill and for Welsh Ministers to have similar power in connection with Welsh provisions.

Clause 321 - Financial provisions

877.     Clause 321 sets out how money is to be provided by Parliament for any expenditure incurred by a Minister of the Crown in connection with the Bill. Any sums received by a Minister of the Crown are to be paid into the Consolidated Fund so far as not required to be paid into the National Loans Fund.

Clauses 322 - 324 - Extent; Commencement; Short title

878.     These clauses provide for the extent, commencement and short title of the Bill.











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Schedule 1 - The Homes and Communities Agency

879.     Schedule 1 sets out the constitution of the HCA, and includes provisions about its status, membership, procedure, delegation, appointment of its chief executive and other employees, pay and pensions, accounts and annual reports. The consent of the Secretary of State is required for certain key decisions of the HCA in relation to appointments and finances.

880.     The Board of the HCA is to consist of not less than six members appointed by the Secretary of State. Paragraph 2 of the Schedule details the arrangements for the terms of appointment of members and includes provision about vacation of office.

881.     Paragraph 3 makes provision about members' remuneration, allowances and pensions.

882.     Paragraph 4 details arrangements for the appointment, terms and conditions, pay and pensions of the HCA's chief executive and staff. The Secretary of State must approve these arrangements.

883.     Paragraph 5 enables the Secretary of State to fund the HCA and paragraphs 6 to 10 detail how the HCA is to organise its committees, including arrangements for members to declare interests, and for the delegation of functions.

884.     Paragraphs 11 to 17 detail arrangements for the HCA's financial reporting of its accounts, and other administrative matters.

885.     Paragraph 18 enables the Secretary of State instead of the HCA to appoint the first chief executive and to determine the terms and conditions of his service.

 
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Prepared: 2 April 2008