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Let us look first at choice. Cave identified a number of collective choices—I shall not talk about individual ones—such as tenants having a choice about the range of estate services that they receive; a choice about a change of manager and the choice of the individual; a choice about additional services, as long as tenants are prepared to pay the costs for them; a choice about changing maintenance providers; and a choice about self-management options. However, as we can see, the Bill defines choice in an excessively narrow way. When the Government consulted after the report, they put most of the weight of their consultation on tenant management choices; that is, tenants having the right to take over the management directly of their properties. Amen to that—it is a good thing—but most of us do not want to spend our lives running co-operatives. We want to be able to receive the services that we feel we should get from suppliers and, if they do not deliver

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them, we want some power, influence and the choice to make changes. Because of the Government’s narrow focus on tenant management options, they have squeezed out consideration of a number of other things that matter a great deal to tenants. They have defined choices narrowly and have not addressed the structural impediments to choice that tenants experience.

Secondly, Cave quite rightly saw that choice and accountability require information. You cannot make informed choices without it. That is why all regulators are concerned about information. To hold anyone to account you need information about what they are doing and you need comparisons. All noble Lords have said that comparisons at local level, across all three types of social housing, are essential. Cave said that the regulators should play a key role in ensuring that core information is available across all areas. This must be at a local level, because people will want to know how their RSL is performing compared to another social landlord in the area.

We are in the remarkable situation where the Local Government Association, the National Federation of ALMOs, the National Consumer Council and the Chartered Institute of Housing all say that there should be a single system of collective performance information. The specialist body HouseMark, with one or two significant challenges about the small sample size, says that this is perfectly possible. Yet although the Government have known for a year that Cave was going to recommend this, we have the sad situation where they are still saying that they do not have time to do it in the Bill. To many of us, that is not where we want to be. I look to my noble friend to do something about it, because we cannot leave this as a hole in the Bill. If that requires a power and the creation of secondary legislation, I can assure her, as ever, that the Merits Committee will look on her with the kindness that she is used to receiving.

The Bill says nothing in Clause 88 about enhancing accountability being one of the fundamental objectives of the regulator. I would have expected it to do so. To give further instances, there is no clarity about the processes to strengthen accountability to tenants, about key triggers in how they can involve the regulator in an inquiry and about their right to sack a manager or to choose a manager in first principle.

Cave said that there is an overwhelming case for establishing a national voice for tenants of social housing. I agree. I am delighted that the Government agree and that they are going to do something about it. In part, the Bill is in this state because there was not a powerful voice by tenants making these arguments. Officials and Ministers look to where the pressure is coming from and, if there is no pressure from a consumer quarter, the producer interests—the traditional vested interests—tend to have more than their fair shout.

The Bill and the process, unless I have missed it, are silent on whether tenants will have a voice over the sale or merger of their homes. It is fundamental that they should be given the right to express a view—there cannot always be a deterministic view—and the regulator and RSLs should have a statutory responsibility to listen to tenants.

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Finally, I turn to what may seem a rather dry fundamental: addressing the structural obstacles to empowerment and choice, as Cave described it. This has always been a key role for regulators when trying to address monopolistic provision. How do you change the structure of the service that so disempowers tenants? We now have a choice of telecom providers—they are not all good and they are not all bad—because previous Governments put in place over a 10-year period processes to ensure that the market supply changed. We have a mess with the London airports because we have failed adequately to regulate and address the market supply with BAA in ways that actively produce the effective competition that empowers users and gives them choice.

Addressing structural issues is phenomenally important. Cave said that part of the reason why social housing exhibits so many signs of failure is the consequence of “deeply embedded structural features”. He said that,

Any regulator worth their salt would say the same.

Cave talked about some issues for consideration in the future, such as separating the development and the ownership role from the management. Indeed, some are seeing RSLs on a scale of 50,000 properties. When we were managing the housing of local authorities, we thought that that was the problem, but now we have RSLs with that scale of ownership. By definition, the head office will be remote from tenants, whereas in the past, when I used to run housing associations, the tenants could walk round the corner and give you a good kicking, as they often did.

Even though there may be economies of purchasing power on development, buying and financing that we may wish to retain, we ought to be looking, as should the regulator, at whether we should be unbundling to give tenants more choice and control over their management—in other words, the contestability of housing providers at the instigation of consumers collectively. When you have a good provider at a local level—whether it is a local authority, an RSL or an ALMO well able to do management—and scattered housing stock, tenants should be able to have their management carried out by whoever is the best provider and best manager.

Cave said that the regulator should introduce measures to stimulate competition for management of social housing services across the domain, to give tenants choice and to enhance service delivery. There is no clarity whatever in the Bill about the tenants’ right to sack or choose their management. All they can choose to do is set up their own management organisation if they are an RSL. There is no clarity that the regulator has to promote appropriate supply options or to address structural deficiencies in the market, but there ought to be.

The VAT issue is a sad, anoraky instance of a structural impediment. An ALMO or a local authority can get a registered social landlord, albeit in a wicked private sector organisation, to undertake the management for them. But if a registered social landlord wants an ALMO, another registered social

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landlord or a local authority to undertake the management, it suffers a 17.5 per cent VAT impediment. This matters a great deal, because many registered social landlords have small pockets of stock, which, by definition, means that their housing management function is remote and that they do not provide economies of scale at a local level or, necessarily, a locally sensitive understanding. Yet the national process of rationalising some of that—if that is what tenants want—is frustrated by the VAT impediment. The Bill, the process and the Government are silent on that. I can guess why—the Treasury would not like it—but we should put on the regulator a duty to work progressively to overcome structural impediments to empowering tenant choice, and this is one of those. It may take five or 10 years, but it should be on the agenda.

Among the people to whom I have talked about this sad return to housing on my part, I have identified a great deal of support for the objectives and aims of the Bill but also concern that the Bill in its present form does not achieve the objectives around tenant choice and empowerment. This matters because the Government have stated that it is one of their major objectives. I and many organisations, as well as, I trust, many others in this House, would be pleased to work with the Minister—it is a long time before Committee stage—to try to plug some of these gaps. I look forward to doing so.

7.28 pm

Lord Patten: My Lords, about 10 minutes ago, while sitting on my perch up here on the Back Benches, my heart leapt when I saw the noble Lord, Lord Bassam of Brighton, walking across the Chamber towards me. For one glorious moment I thought I was to be the recipient of a spot of Floor-crossing. Instead, with his characteristic courtesy, he had come to tell me that because of the withdrawal of an intervening speaker I was to follow the noble Lord, Lord Filkin. Although I shall not follow the noble Lord’s arguments—I wish to address my arguments to Part 1 of the Bill and he addressed his arguments to Part 2—that gives me the chance to say how full of admiration I am for his analysis of a whole range of matters concerning, choice, regulation and the need for structural reform. Noble Lords on both sides of the House should pay close attention to what the noble Lord has said.

I should begin by reassuring my noble friend Lord Dixon-Smith on our Front Bench that I can say with absolute certainty that he has 100 per cent support from Back-Bench speakers behind him today. The Bill, which the Minister introduced with her characteristic verve, does a lot of things, one of which should not go unremarked. The Bill, in Clauses 51 and 52, lowers into an unmarked legislative grave that high watermark of paleo-old Labour, the Commission for the New Towns. The first new town, Stevenage, according to EM Forster in his Howards End, fell,

That was back in 1946, when our attitude to consultation was also perhaps a bit paleolithic. Then,

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the Minister’s lineal predecessor, Lewis Silkin MP, got into his ministerial car and went to old Stevenage to consult the townsfolk concerning their fate, which he described as,

The locals did not seem to like the sound of that very much, and they said so. In response, the Minister, adopting the best “man from Whitehall knows best” approach, said, “It’s no good you jeering. It’s going to be done”. The locals’ response was to let down the tyres of the ministerial limousine. Bad behaviour by them, which I deplore, but it followed a bit of bad behaviour by the Minister. Alas, that is sometimes still the attitude struck by some in local authorities and their officials with regard to some housing matters.

This is the sole issue I want to raise: the contribution that an enhanced role for the Homes and Communities Agency, which in general terms I welcome, could make in improving housing quality. The Minister lays that duty on it in Clauses 2 to 5, particularly in the matter of good design, which is important, a point to which the right reverend Prelate the Bishop of Leicester referred in his speech.

Design is not some preoccupation of aesthetes or the limp-wristed. As the Royal Institute of British Architects says, good design brings pleasure, attracts people and investment and helps communities to build, bond and generally be happier. It is not some kind of latte-liberal preoccupation. Well designed homes are exactly what hardworking families want. As the Minister told the House, she is laying the duty for the Thames Gateway development on the HCA. That will succeed or fail not just on structural things such as roads, schools and houses but on the actual design of the homes that people are going to live in. That is of critical importance. The trouble is that all too often ordinary working families do not get this—that has happened over a sustained period; I certainly do not blame this Government alone for that failure—and they will not get it until there is a revolution in attitude among the two most important groups involved in housing design: council planners and private sector house-builders. The HCA should be given a statutory duty to help to give guidance to both.

The Bill is very timely, all the more so because of what one might term the “Persimmon pause” which gives us some breathing space to get this right. What is this “Persimmon pause”? Persimmon’s decision of last week has been referred to by at least two noble Lords. That good and high quality listed building company said last Friday that it was going to cease new housing development for the time being because of market conditions. This is a harbinger of building and construction things to come; other housing companies will follow. I have no current interests to declare, but for a while I was a non-executive director of Alfred McAlpine plc when it was a house-builder. I predict that the maximum number of new homes built in 2008 will be no more than between 100,000 and 110,000. That will not meet demand. The number in 2009 is unlikely to be much higher. This is bad news for people wanting new homes of any sort, but it could, if we make use of the Persimmon pause, be good news for housing design, for the quality of new

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homes when they start being built en masse again to meet the Government’s targets as well as popular demand, and for putting right what the chief executive of the Commission for Architecture and the Built Environment wrote of in 2007. I quote:

and which customers have a right to expect. He has also opined—quite rightly, to my mind—that now is the time to build homes that are also,

The best way to ensure that is to ensure that every council in the land has access to a local design review panel, with the HCA being given the statutory duty to promote these bodies and to give guidance on how they could be set up and run. Far too few councils in this country have that access. Councils desperately need help here; too often they fail, for a whole host of reasons, to consider design issues properly. Indeed, one local councillor at the south Somerset end of our Westminster/south Somerset axis wrote to me on 12 April lamenting the attitude of planning officers to design issues in that council. Fearing for his safety in the area—I will not mention his name, but I will mention his words—he said:

That attitude is reflected too widely up and down the land and is certainly not restricted to councils of any one form of political control. I would not dream of asserting that.

Design panels can help at very little cost, being made up of architects, landscape designers and other professionals working pro bono. One good example of that is the Royal Borough of Kingston, which set up just such a panel in 2005. The panel has subsequently commented constructively and influenced the quality of some 2,200 homes in the borough. The cost of these things is minimal because time is given by landscape designers, architects and others for nothing. I have gone into this matter, and the time spent on this in Kingston is minimal: it requires part of the time of one council officer, the provision of some venues and a bit of organisation. The actual cost is £15,000 per annum. That is extremely good value. I assure the Minister that I am not putting to her the need for any new bureaucracy or any new massive public expenditure. To the contrary; the dialogue between the planners, builders and the community can, in the end, save time and money as well as improve the quality of the environment and so outweigh the costly process of later planning appeal and compensation.

The HCA could draw up guidance with the powers that the Minister intends to give it in Clause 43 of the Bill. With the help of CABE, the Royal Town Planning Institute, RIBA and all the other relevant bodies—I am not a professional in this area; I have not been snowed under by the list of representations that the noble Lord, Lord Best, has received and which he so kindly enumerated for the House—a revolution could happen in our housing design if such guidance were given. The Government must take this seriously in order to provide a better setting for the new communities

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they plan, and I have no doubt that they wish to do so. This approach would also complement the advice that CABE already gives to big strategic schemes with their regional design panels.

I finish by illustrating these benign-sounding sentiments with some specific examples. The right reverend Prelate the Bishop of Leicester gave the specific example of the eco-town proposed for the edge of that great city. I hope that what he said is listened to nationally as well as locally. The noble Lord, Lord Smith of Leigh, who is not in his place, spoke earlier about micro issues concerning housing quality in the ward which he represents in Wigan. I shall pick another area: the West Country. I hasten to add that I have no interest to declare in any planning issues being considered in the area where I live: there are none within sight or sound of our property. However, there is some local interest in these matters which I would like to use to illustrate the theme of my speech thus far.

Over the Easter weekend, I looked at proposed sites, sites under construction and sites half-finished in two adjoining local authority areas: South Somerset District Council and Mendip District Council. I live near the border between the two and the difference is striking. Neither council has local elections this week so there is no political component in what I am saying. To cross from South Somerset, which, alas, has recently given all-too-little attention to good design, into Mendip council’s area is like crossing some institutional and design fault-line, from the too-often indifferent in the former to the very good indeed in the latter. In the latter is one of the developments picked out by CABE, the Commission for Architecture and the Built Environment, in its 2007 Housing Audit: at Dukes Rise on the edge of Shepton Mallet. I say well done to the developers, well done to the council and well done to Bloor Homes, which built the houses. The landowners had their own design team to inform the local council on these matters, very much like a mini-local design review panel to help council planners. It had a design brief which stated:

It is very hard not to say “Hear, hear” to that. It is worth repeating, but I shall not.

Unfortunately, that attitude is not always reflected in South Somerset District Council, where the local council leadership seems to behave exactly like Lewis Silkin back in 1946 in Stevenage, at least to the extent of refusing to enter into correspondence with local people—I should like the noble Baroness, Lady Hamwee, to draw these remarks to the attention of her colleague who will wind up this debate for the Liberals—not over greenfield or brownfield development, nimbyism and all the rest of it, but even over such simple, innocent matters as good design and its quality. The local council leader gives no reply to letters about this.

Just as I have a question for the Minister—will she consider introducing a statutory design advice function for the HCA in the Bill?—so I pose a question for the

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Liberal Front Bench in its wind-up, which I have never done before in your Lordships' House. How can local people persuade the local council leadership—I know nothing for or against the gentleman concerned; he is called Councillor T Carroll—to reply to letters about such innocent matters as good housing design, or is he going hell for leather to win the Lewis Silkin memorial prize for consultation? I do not know, but I am sure that the Liberal Front Bench values good design for housing, and I am sure that there are councils of all political hues which behave inappropriately, arrogantly and do not respond to correspondence. But as we have been given the lead by the right reverend Prelate and the noble Lord, Lord Smith of Leigh, to talk about local matters to illustrate our general themes, that, I have done.

7.45 pm

Lord Morris of Handsworth: My Lords, at this point in the debate, much has already been said about the Bill. I declare an interest as the chair of the Midland Heart Housing Association. Like other noble Lords, I give a general welcome to the Bill. Its provisions are timely, ambitious and urgently required.

The Bill comes at a time of great need for social housing, when the traditional marketplace for housing finance has developed a degree of chronic instability. The Bill therefore offers the reassurance that housing is and remains a social priority for this Government.

Your Lordships will have heard much about the key features of the Bill, not least of which are its structural provisions; namely, the powers of the regulator, the role and powers of the new Homes and Communities Agency, the Secretary of State’s possible new powers of direction, and the long-overdue powers of protection for tenants. However, much more work on the Bill needs to be done, particularly in the area described as domain regulation. As my organisation sees it, and as many housing associations have stated in representations, a clear timetable is needed for ALMOs and local authorities to be brought within the scope of the Bill’s provisions, without which there can be no level playing field. Some providers will have a distinct advantage.

We also look forward to a clear statement on the key principles which will guide the Homes and Communities Agency’s programme. That guidance would be helpful, because housing associations would like to know how the transition in respect of the spending programme for the two legacy agencies will be managed in the new organisation.

I want to shift the focus of the debate from the frontline activities of registered social landlords to those so-called non-housing activities carried out by many housing associations, because to the people who are on the receiving end of them the results can be life-changing. These activities are carried out by housing associations. They are not mandatory but optional. Housing associations seek some assurance, which I hope the Minister at some point will be able to give, that voluntary, non-housing activities will remain and maintain their existing status.

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It would be a gross misunderstanding to assume that housing associations only build houses; we know better. Most housing associations do not just build houses; they change lives and build social capital in many of our communities. I hope that the House will permit me therefore to share a few examples of housing association activities which are being carried out by many organisations. They are not headline-grabbing; you will not see many of them in Inside Housing or in any of the publications.

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