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The noble Lord, Lord Dixon-Smith, made a point about people waiting to gift land for housing. They can do so, and gifting land for housing has already enabled some community land trusts to get off the ground. That work is there and can be built on. We are looking at pilots and want to ensure, through consultation, that we get this right so that we can further encourage, develop and support community land trusts as my noble friend Lord Graham seeks. We are as one. We will get there. It is about getting this right and ensuring that we can make progress that stands up effectively and enables us to develop further this avenue of providing affordable housing.

5.45 pm

Lord Graham of Edmonton: I am grateful to the Minister and his colleagues, who have clearly taken the issue seriously. I read into this an argument that I am inclined to—I will not say “accept”—understand. My understanding comes from the fact that responsibility for the Government’s actions if things go wrong lies with the Government. I consequently understand the need for caution.

The Minister told us that there will be consultations in the summer on the need for a legal definition. If the experts from Salford who have advised me say that there is a need, that is not the end of it; they could be right or wrong. If we are told that there is no need for this, the Government must look at the consequences of saying that to the financial world, to landowners and fund providers.

I will withdraw the amendment and consult colleagues outside. This will not go away. Everyone in the room wishes it not to go away; it is a question of how we can make it go forward with a little more speed. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 80 agreed to.



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Clause 81 [Provider of social housing]:

Baroness Hamwee moved Amendment No. 99A:

“( ) are public authorities for the purposes of section 6 of the Human Rights Act 1998 (c. 42) and for the purposes of amenability to judicial review by the Administrative Court.”

The noble Baroness said: The amendment is grouped with Amendments Nos. 100, 103, 104 and 110 of the noble Earl, Lord Onslow. I apologise to him for stealing his thunder. I tabled the amendment after discussions with the Housing Law Practitioners Association, a group of lawyers which has briefed me from time to time over the years and which I have always found extremely helpful. It has raised points which need dealing with. I did not realise when I tabled the amendment that it would be the first in the group. As I say, that is a pity; it is not intended to detract from the points of the noble Earl.

This brief point is again about a level playing field. Are tenants of housing associations in the same position as tenants of local authorities in that they have the benefit of human rights legislation? Put the other way round, is their landlord body under the obligations of the Human Rights Act? We are all aware that provision of social housing has increasingly moved away from local authorities. It is quite odd and coarse to distinguish between the providers of housing in a way that affects tenants. Indeed, the whole thrust of the Bill, subject to the points made by the noble Lord, Lord Best, at the beginning regarding local authorities, is that every tenant matters and that every tenant has similar protection.

There is a chain of cases, of which the Government will of course be aware, but what they seem to boil down to, and what the Government have to say, is: “Let the court determine in any particular case whether the relationship between the housing provider and the local authority is such that it comes down on one side of the line or the other”. That is a very unsatisfactory position, and I believe that the Joint Committee on Human Rights takes the same view.

The issue arises in areas such as allocations and grounds for possession. While I appreciate—probably not adequately—the Treasury point about categorising housing associations, I am not persuaded that we should not be looking for a way of getting round that. This may not be the right way, but to leave a large group of tenants without the protection that they would have had, had circumstances which are probably entirely outside their control been different, seems to me a very sad thing. It cannot be a good thing for people’s rights to depend on who their housing provider is when, in almost every sense of the word, we are talking about public provision. I beg to move.

The Earl of Onslow: I do not begrudge the noble Baroness, Lady Hamwee, her nanosecond of glory in the slightest. She is perfectly welcome to open the batting if she wants to.

I had a meeting this morning with the noble Baroness, Lady Andrews, for which I am grateful. I explained to her, I hope, that this arose in the Joint Committee on Human Rights out of a case that was brought before

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the courts over a lady who was being looked after in private healthcare. In the YL case, because her care was provided privately, it did not count as a public function. Up until then, everyone had assumed that the Human Rights Act was supposed to cover anything that was providing a public function.

The difficulty here for me is that if landlord and tenant is not a public function, the Human Rights Act does not apply to the duties. If it is a public function—I am most grateful to the noble Baroness, Lady Faulkner, who drew this to my attention—when in Clause 88(2) under “Fundamental Objectives” there is objective 1,

that strikes me as a public function that is being imposed on the regulator to provide social housing, either publicly or privately owned. Therefore, it seems to me that a public function performance is needed.

I am also told that there is a Treasury rule and that the moment the public function is admitted, it will come under Treasury rules for borrowing. I simply cannot believe that. Is the Minister seriously saying that if the YL case on social housing is reversed then a small company taking out a mortgage to provide social care housing will be subject to Treasury rules? Of course it will not. What is the PFI if it is not designed solely to keep every piece of borrowing off the Treasury books? Some of us have called that “Enron accounting” before now. This is an excuse produced to say that it is a bad idea.

The noble Baroness told me this morning—I am sure that she will tell the Committee, too—that the Ministry of Justice is looking into this whole affair. I quite accept that to try to fix the particular YL problem in one Bill may not be the right way to do it. It is a problem that must be brought to the attention of Ministers. That was the view of the Joint Committee on Human Rights, which considered the matter in a certain amount of detail. We are advised by some clever lawyers who know what they are talking about, and we thought it appropriate to bring this to the Committee’s attention and table an amendment, so I have great pleasure in supporting the noble Baroness, Lady Hamwee.

Baroness Whitaker: The noble Earl, Lord Onslow, reminds me of my days on the Joint Committee on Human Rights, when right from the beginning we had to grapple with this awkward area of bodies which carry out public functions, but which are not inherently public. The courts’ piecemeal judgments have not helped.

Perhaps my noble friend can answer the two questions in these amendments. The first refers to RSLs and the Human Rights Act and the other is about the regulator. I hope that I understand them, but it seems to me that Amendments Nos. 99A and 100 would make the landlords public bodies, which is obviously a huge issue. The other three—Amendments Nos. 103, 104 and 110—are about the conduct of the regulator. The regulator is absolutely a public body and must comply with the Human Rights Act. Perhaps the duties could be made

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more explicit as the latter three amendments suggest. I am not sure whether they are necessary but there would be no objection in principle to what they seek although they may not be correctly worded.

Would the objectives of all the amendments be fulfilled by the regulator setting Human Rights Act compliance standards? If the RSLs’ conduct fell short of the standard the regulator could deal with it. That would be much faster than the tenant going to court saying, “My human rights have been breached”. The question is whether this important area of tenants having the fullest human rights protection would not be satisfied by making it clear either in legislation, or even by the remarks of my noble friend, that the conduct of the regulator must comply with the Human Rights Act.

6 pm

Baroness Andrews: This is an important debate. I am grateful for the way in which it was opened, in competition, by the noble Baroness, Lady Hamwee, and the noble Earl, Lord Onslow. We had a productive meeting this morning, and I hope the noble Earl will forgive me, because these are complex areas, as we agreed this morning. My noble friend has just described them as rather awkward. I shall spend a little time explaining how we have come to our position and reassuring the Committee about the range of issues and the relationship between them. I will answer the two questions asked by my noble friend when I come to that part of my explanation.

I will pitch my words primarily at Amendment No. 100 in the name of the noble Earl, Lord Onslow, as it brings in the breadth of the issues raised by the Joint Committee. These are all subsequent amendments, to which we will return. Briefly, Amendment No. 100 would make the provision of social housing a public function for the purposes of Section 6 of the Human Rights Act. The substance of it arose from the report of the Joint Committee on Human Rights at the end of April. Amendments Nos. 103 and 104 were also recommended by the Joint Committee on Human Rights. They are consequential, so I will deal with them in passing. I will not deal with Amendment No. 106 in the group. We will come back to that, because I have some good news for the noble Earl.

Amendment No. 99A goes rather wider than Amendment No. 100, because the noble Baroness seeks to make all registered providers of social housing public authorities for the purposes of the HRA. That would mean that all functions performed by registered providers would be public functions for the purposes of the HRA. As I said, Amendment No. 100 was originally recommended by the Joint Committee, to which we are very grateful for going into these complex areas with the clarity and depth that it did. It has made an important contribution to Parliament’s scrutiny. The noble Earl started by referring to the case of YL. I will conclude with that, if he will bear with me, because I want to make clear the distinction between social care and social housing in its context.

The Joint Committee’s report proposed amendments to three areas of the Bill: first, the application of the Human Rights Act to the provision of social housing;

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secondly, the regulator’s information-sharing powers; and, thirdly, the current incompatibility in the homelessness legislation following the Morris judgment. We will deal with them in sequence as they arise in the Bill. I cannot accept the amendment, because it proposes that the provision of social housing should be deemed a public function under the Human Rights Act. I will make it absolutely clear why. My arguments are based on logic and principle. I will come to the funding issue later, but that is a consequence rather than an issue of principle.

The noble Baroness talked about the level playing field, and she is quite right to raise those sorts of issues. We strongly agree that social housing tenants need to be protected. Indeed, that is what the Bill is about. Our tenants are already protected, not least through their tenancy contract, which normally offers an extremely high level of security and protection. In addition, we are now giving social housing tenants real protection for the first time in different ways through regulation.

The second objective is to ensure that actual and potential social housing tenants have appropriate protection. The remainder of Part 2 gives the regulator the powers that it will need to ensure that tenants are protected. It covers the ability to set standards, to investigate problems, to enforce regulation in the event of breaches, and so on. In answer to the point made by my noble friend, it is perfectly possible for those standards to include even requirements that landlords act on the same principles that might be covered by the HRA. I should stress that it is up to the regulator, but my noble friend has made a significant point in that context.

The second question my noble friend raised related to the HRA itself. As a public authority, the regulator will be subject to the HRA. The noble Lord’s amendment needs to be seen in that wider context. The definitions of “public authority” and “public function” are crucial. Noble Lords will be aware that adherence to the Human Rights Act is compulsory only where a body is a “public authority”, or where it is undertaking functions of a public nature. So HRA duties arise not only where bodies are obviously public—the historic example is local authorities—but where any body performs a function that is of a public nature. We can bring the housing associations into that category because they perform one function which is of a public nature. However, an important difference is that everything a local authority does will be considered a public function because it is a public authority, whereas for a housing association, as a private sector body, some functions may be of a public nature and others will not.

The Earl of Onslow: I know this is terribly important and screamingly complicated for anybody to understand. Before the YL case it was assumed that private nursing homes while providing care for the elderly which was paid for by the local authority were performing a public function. The difficulty is that when they were providing the same care for people who were paying their own bills they were not performing a public function. Noble Lords are beginning to see how fiendishly complicated and difficult this is so I have a lot of

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sympathy with the Minister on this. However, before the YL case would we have thought that the public function would have applied to housing associations, which are helped by the regulator in a way that we thought care homes were covered by the Human Rights Act? I do not know what the answer is and, frankly, I do not think that anybody else does. However, I should like the noble Baroness to have a bash at answering it, if nothing else.

Baroness Andrews: The simple answer is that we have never considered that housing associations performed functions of a public nature in providing social housing. I shall come on to the contrast with the social care provision and the noble Earl will appreciate the point I shall make about the differences in those functions.

Housing associations have always been private bodies. Why is that? I can give several reasons. This is what we would have said to the committee had we been able to submit a more substantial response. Housing associations are not controlled or owned by the state. There are about 2,000 of them, they are independent and most of them are charities. They have long and very honourable histories, often rooted in the personal benevolence of benefactors providing housing as a private function. That is what makes them so unique and independent. We are committed to that independence. I accept that they have one very limited public function. They were recently given statutory powers to deal with anti-social behaviour. While we accept that they have a public function in that context, that is very different from their core business, which is to own and manage social homes—I think that the noble Lord and the Committee saw the letter from my honourable friend Iain Wright to the Joint Committee—so anti-social behaviour is very much the exception.

As I say, there is no logic or tradition which suggests that the provision of accommodation below the market rate, as in social housing, is in any way inherently a public function. For 40 years the Housing Corporation supervised the provision of social housing by most housing associations and these bodies raise most of the money they need to build houses from private sources. They do not rely on public money to own and manage them, and have no role in the allocation of that process.

So I agree with the noble Earl: it is not the nature of the organisation providing the function, it is the nature of the function provided. On that basis, you could draw a parallel with some of the functions carried out by commercial organisations. Provision of social accommodation is almost identical to providing market housing except that the price and distribution of the service are controlled through regulation. In summary, social housing is not a public service which has been recently privatised, it is a regulated voluntary activity which local authorities become involved in. For these reasons, we disagree in principle with the Joint Committee’s conclusion that social housing is an inherently public function. By implication, I therefore also disagree with the amendments and the noble Baroness, Lady Hamwee, that registered providers—whose core functions are about social housing—should be public authorities for HRA purposes.



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The practical implications are not an excuse, as the noble Earl suggested. I am arguing this case from a position of principle and logic. The consequences are serious not just for the sector, but for the whole provision of social housing in this country. The first point is relatively minor, but it will not be minor to the associations themselves. Putting the provision of social housing as a public function under the Human Rights Act will obviously impose additional costs on the sector in preparing for and dealing with the possibility of legal challenge. This is not a minor issue; some of these RSLs are very small and would not be able to cope with these sorts of legal challenges. Those costs would need to be met by increased rents and, unlike local authorities, they would not be subsidised by government grant and would clearly not be of benefit to tenants. As a principle, we seek not to impose burdens or costs on independent organisations without at least a consultation.

However, the most serious point raised by the noble Baroness and the noble Earl is that classifying social housing provision—or, indeed, RSLs themselves—as “public” for the purposes of the HRA could affect the present classification of housing authorities as private-sector bodies. The noble Earl and the Joint Committee argued that treating the provision of social housing as a public function would not necessarily imply that any organisation that performed the function was institutionally connected with the state, nor that the state would be required to exercise control over its management or operation. That is true: it would not necessarily do that. However, it is a serious risk. Even if the probability is low—and I do not think that it is—the impact would be very serious indeed for the future of housing supply in this country. The point is that if the current ability to borrow were choked off, £35 billion would be added to the public balance sheet. We would simply be unable to build the social homes we so desperately need in this country.

This question of risk was seriously examined in the other place, changes were made to the Bill to ensure that those risks were not run and relationships were clarified in such a way that everyone could see that these remain private functions. Those were important changes. If we were to make the core service—the raison d’ĂȘtre of the housing associations—a public function, it might pose a material risk of reclassification. Far from being an excuse, that is a terribly serious implication.

6.15 pm

As I say, that is not my prime argument. Finally, there is the question of case law. In considering the amendment, we need to take account of emerging case law. The noble Baroness referred to it in the amendment, and the JCHR did so too. The current position of the courts supports our view that the provision of accommodation by private bodies, including housing associations, does not amount to a function of a public nature for the purposes of the HRA.

The noble Earl referred to the recent decision by your Lordships’ House in YL and Birmingham City Council. The ruling in that case held that an RSL-owned residential care home was not undertaking functions

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of a public nature for HRA purposes, despite the fact that the appellant’s care had been arranged by her local authority under the National Assistance Act. However, it remains the Government’s view that, in general, the provision of publicly arranged health and social care should be considered a function of a public nature. Amendments have been tabled to the Health and Social Care Bill by my noble friend Lady Thornton to restore the Government’s intention in relation to that function.

Why is that consistent with our position that social housing does not constitute a public function? There are two reasons. First, unlike social housing, care homes provide both accommodation and, critically, social care. They are restricted to extremely vulnerable people and are very heavily regulated. The same is not true of social housing, which caters to a much wider client group and covers accommodation only. Social care inspections are frequent and intrusive; the inspection of social housing provision happens about once every five years.

Secondly, social care tenants do not have the sort of contractual relationships that are governed by and govern the relationships that tenants and social housing have under the Landlord and Tenant Act. An important point is that YL affects only publicly arranged care home places. General needs social housing provided by housing associations is not normally publicly arranged. Most of the funding is sourced from rents, private borrowing and the RSL’s own resources; not grants. It is not carried out under contract, but as a private function with appropriate regulation.

So stark are the differences between social housing and care homes that I suspect that, if it was accepted that social housing provision was a public function because it was similar to care home provision, the next argument might be that private rented sector provision is a public function because of its similarities to social provision.

I want to conclude on a positive note. I have gone into that detail for all the reasons that the noble Earl invited me to; these are complex and important issues. This whole debate has raised important issues about definitions. As part of the Government’s response to the YL case, my honourable friend the Minister for Human Rights intends to undertake a consultation on the scope of the Human Rights Act. We think that this is the best way of taking forward the broader question of what should and should not be considered subject to the Human Rights Act. I was grateful that the noble Earl said that he did not think that this Bill was the right place to address this much larger issue, and he is right in that judgment. The preparatory work for that is under way, but we do not have a strict timetable for it.


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