Orders of the Day — Housing Bill

House of Commons, 8 November 2004.

Improvements in Energy Efficiency

Michael Lord (Deputy Speaker, Central Suffolk and North Ipswich)

I inform the House that privilege is involved in Lords amendments Nos. 35, 36, 51, 52, 88, 101, 103, 105, 107, 186, 190, 191, 192 and 202. If the House agrees to any of these Lords amendments, I shall arrange for the necessary entries to be made in the Journal.

New Clause

Keith Hill (Labour, Streatham)

I beg to move, That this House disagrees with the Lords in the said amendment.

This amendment would place an obligation on the Secretary of State to take reasonable steps to ensure an increase of at least 20 per cent. in residential energy efficiency by 2010. I assure the House that the Government have absolutely no difficulty with the idea that residential energy efficiency should be increased. In debates on this issue in the other place, the Government were accused of weakening their position on that commitment, but I hope to be able to demonstrate the fallacy of that argument. I will also show that the amendment is unnecessary because existing legislation already provides the basis for setting and—just as important—reviewing energy efficiency aims.

The 2003 White Paper referred to savings of around 5 megatonnes of carbon as an indication of what we thought we could achieve at that time. With the benefit of further analysis, we have been honest enough to publicise a slightly lower figure. The energy efficiency plan of action, published last April by my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs, details measures that will deliver savings of 4.2, rather than 5, megatonnes of carbon in the residential sector.

Brian White (Labour, North East Milton Keynes)

Will my right hon. Friend give way?

Keith Hill (Labour, Streatham)

My hon. Friend knows that I am a big fan, but I would like to be allowed to develop my argument a little before I yield to him.

That figure is based on detailed analysis carried out following publication of the White Paper and reflects changes in economic and technical assumptions that came to light as a result of further work undertaken by DEFRA. So the Government have not sought to pull the wool over people's eyes on this issue. Indeed, the beauty of the figure of 4.2 megatonnes is that, at about 19 per cent., it is very close to the 20 per cent. improvement that this amendment seeks. Achieving 4.2 million tonnes of savings is in fact roughly equivalent to doubling the historic 1990s rate of energy efficiency improvement.

My right hon. Friend the Secretary of State has declared an energy efficiency aim of 3.5 megatonnes of savings in England, under the Sustainable Energy Act 2003, as a contribution to the UK target of 4.2 megatonnes. The Act enables us to keep our aims under review, and improve on them where we can. DEFRA will consult shortly on the climate change programme review and we will also review our energy efficiency aim in 2007, as well as setting the target for the next phase of the energy efficiency commitment beginning in 2008. In other words, this is a constantly developing scene.

Savings of 4.2 megatonnes of carbon are not to be sniffed at, and they are not the whole story. The difference of 0.8 megatonnes between the White Paper and action plan figures will be more than compensated for by an increase in projected savings from the business and public sector. We estimate that the measures set out in the action plan will achieve carbon savings of around 12 million tonnes per annum by 2010 across all sectors. That is 20 per cent. greater than the original White Paper figure of 10 million tonnes and by 2010 is expected to save households and businesses more than £3 billion a year on their energy bills.

Tony McWalter (Labour/Co-operative, Hemel Hempstead)

There is much in what my right hon. Friend says, but is he aware that any saving in energy not only saves carbon emissions, but potentially depresses the need for nuclear energy as part of our energy sources? I would be grateful if my right hon. Friend addressed that issue and not simply that of carbon emissions, important though it is.

Keith Hill (Labour, Streatham)

I take my hon. Friend's thoughtful point, but I am the Minister for Housing and Planning and I am addressing the issue in the context of housing. Wider issues of energy policy are not for me. I guarantee, however, that his observation will be reported to the Department for Trade and Industry, which has responsibilities in that area.

Simon Thomas (Plaid Cymru, Ceredigion)

The Minister has tried to claim that savings on carbon emissions from the industrial sector will offset the 16 per cent. cut—it is not a small cut—in the Government's initial target. However, that does not address the issue of fuel poverty and the warm homes initiative. If a 5 megatonnes saving had been the target, it would have provided the opportunity to deliver energy efficiency in the domestic sector with corresponding savings for some of the most deprived in our communities. I would not like the Government to lose sight of that aim.

Keith Hill (Labour, Streatham)

I am grateful to the hon. Gentleman for his observation. I assure him that there is no danger of the relationship between energy efficiency and fuel poverty being ignored in the course of our deliberations. In fact, it is my expectation that we will be able to discuss those issues at some length and in detail in consideration of the third group of amendments, which includes proposals on the decent homes programme. He will be aware that we have to make a distinction between issues of energy use and energy loss and issues of income. There is not necessarily a direct and obvious relationship between the two, as I will seek to argue later.

Brian White (Labour, North East Milton Keynes)

In Committee, it was pointed out that there was a discrepancy in the way in which the figure of 4.2 megatonnes was calculated and the Minister who replied agreed to look at it again. What action has been taken to review the figure?

Keith Hill (Labour, Streatham)

I am certain that when Ministers make such undertakings they are followed up. I know that my hon. Friend has a deep interest in this issue—as is demonstrated by his legislative attempts—but the picture is shifting and evolving. As the technology changes, the opportunity for delivery occurs. I take his point, however, and I shall seek to ensure that those undertakings were properly pursued. I am sure that they were.

John Hayes (Conservative, South Holland and The Deepings)

The picture is indeed shifting, but it is important for the House to be clear about it. In the other place, Lord Bassam said that the decent homes programme would reduce carbon emissions by at least 2 megatonnes. The Government's energy efficiency plan for action, however, claims that the decent homes programme will be responsible for 0.05 megatonnes. The position has shifted, but has it really shifted that much?

Keith Hill (Labour, Streatham)

Perhaps the hon. Gentleman will permit me two things: to develop the argument in my speech, which is primarily about energy efficiency; and to revert to the decent homes programme in our later exchanges. I am, however, grateful to him for putting the issue on the record. At an appropriate point, I might be better placed to answer it.

Joan Walley (Labour, Stoke-on-Trent North)

A number of Members are obviously concerned about the amendment. I welcome my right hon. Friend's commitment to further review, but in the light both of debates on the Energy Bill and of the Environmental Audit Committee's recommendations to the Government, will he give the House an assurance that he will find some mechanism in the review to consider what his Department, DEFRA and the DTI are doing so that we can be certain that we have the best possible standards for dealing with energy efficiency as the cheapest, cleanest and safest way to reduce CO 2 emissions?

Keith Hill (Labour, Streatham)

I am happy to give my hon. Friend that assurance, and I do not do so in a facile fashion. This is an aspect of genuine joined-up government—to use that familiar and slightly cod phrase. Indeed, I recently met DEFRA Ministers precisely to discuss such issues. Other Ministers were present, as well as representatives from other Departments, so the issues are genuinely being addressed across the board, and I hope that my hon. Friend finds that, at least, reassuring.

I was setting out certain points about the progress that we have already made on the action plan and the objectives for energy and carbon savings, which go beyond those originally identified in the 2003 White Paper. It is important that those points are put on the record. They have certainly been raised in previous debates, but it does no harm to reiterate them. That is not all. More energy efficiency measures are being backed by firm policy commitments than ever before. I highlight two key measures: we expect condensing boilers to be installed faster under the 2005 building regulations than anticipated in the energy White Paper, and we expect installations of cavity wall insulation to more than double under the next phase of the energy efficiency commitment, which puts obligations on energy suppliers to achieve energy efficiency gains.

I regard the amendment as well intentioned but unnecessary and inflexible. We are already working towards its objective. Setting a numerical target in primary legislation will not help us to pursue an open, technically sound, evolving approach to the setting of objectives and targets.

Although I recognise the genuine interest in the issue shown by hon. Members on both sides of the House and have listened to debates in this place and read those that took place elsewhere, I have been struck by the approach of some Opposition Members. Their zeal for the amendment has not been matched by their approach to other provisions in the Bill that would in fact help their case. I am thinking particularly of the home condition reports that will form part of the home information packs under part 5. The EU directive on energy performance of buildings will make it compulsory for home sellers to provide energy efficiency information on their home to potential buyers. That is entirely reasonable. We know that most improvements to homes take place when keen new owners take over.

Edward Davey (Liberal Democrat, Kingston and Surbiton)

I am grateful to the Minister for giving way and I apologise for not being in the Chamber for the beginning of his remarks.

Does not the EU directive require certification of energy efficiency to be given only when the house is sold and not when the property is marketed? Is not that key to the Minister's proposals for home condition reports?

Keith Hill (Labour, Streatham)

We will have an opportunity to discuss those matters and, in due course, I want to go into a little more detail about the inter-relationship of the energy and home condition reports. The EU directive will require an energy report at every point of sale and that will be part and parcel of the home information pack.

Although the Opposition favour compulsory energy efficiency reports—at least, the Liberal Democrats favour them—they do not support the very means whereby they will be delivered cost-effectively: compulsory home condition reports as part of a compulsory home information pack. Those reports will contain information about the energy efficiency of homes when they are marketed. Compulsory home information packs, with data about the energy efficiency of a property and what a new owner can do to improve it, will capture that moment. Voluntary packs risk frittering that opportunity. We will return to the issue when we debate the next group of amendments.

Lynne Jones (Labour, Birmingham, Selly Oak)

I entirely agree with my right hon. Friend about the mechanisms to improve energy efficiency, but what I cannot quite understand is why he thinks that the 20 per cent. target would be inflexible. If we overshot it and did better, that would be fine, but is not it good to have the target, to fix the Government's mind and to ensure that we reach the minimum necessary to achieve our overall goals? After all, let us not forget that our overall goal is a 60 per cent. reduction in CO 2 emissions by 2050.

Keith Hill (Labour, Streatham)

But we are already almost at that 20 per cent. point—achieved by mechanisms that may not have been anticipated even two years ago. When we are moving towards the target, with which my hon. Friend is properly concerned, it seems unnecessary to add this provision to the Bill and set a numerical target, which may be overshot or outdated but none the less adds a degree of inflexibility. Indeed, it might even encourage a degree of complacency. Let us have neither suspicion of the Government's intentions nor encouragement to complacency. Let us not make an unnecessary amendment to the Bill.

Robert Syms (Conservative, Poole)

It has been a fair time since we debated these issues in Committee, and one could have predicted that they would come back at this point. The upper House has done us a favour by bringing the matter back to our attention.

The amendment is not unreasonable. It is not unreasonable that

"the Secretary of State shall take reasonable steps to ensure an increase in residential energy efficiency of at least 20% by 2010 based upon 2000 levels."

The Government included that commitment in their manifesto, so it could not have seemed too inflexible then. They said that they would decrease CO 2 emissions by 20 per cent. by 2010 based on 1990 levels. From 1990 to 1997, carbon emissions decreased by 13.1 million tonnes. Since the Government were elected in 1997, such emissions remained almost static, but in three of the past four years they have increased.

In August, the Environmental Audit Committee reported that the Government's latest forecasts indicated that by 2010 carbon emissions would be 8 million cubic tonnes more than the target—a 25 per cent. shortfall. That target is the Government's target; they have assured the public no fewer than 15 times that it would be the energy efficiency aim set under the Sustainable Energy Act 2003. Some members of the Government have promoted that target. On 17 August, the Secretary of State for Trade and Industry wrote to Mr. J. Card of Hereford:

"I hope the above helps to convince you that the Government has put in place measures to deliver the expected 5 million tonnes of carbon from household energy efficiency savings."

The Government's sustainable energy policy network website lists as an objective delivery by 2010 of

"additional emissions reductions in households of around 3.5 million cubic tonnes . . . beyond those envisaged"—

that is, 1.5 million cubic tonnes—

"in the UK Climate Change Programme".

That equals 5 million cubic tonnes, or the 20 per cent. specified in the amendment. The site also states that it is a Government "commitment" to deliver

"improvements in household energy efficiency of 5 million cubic tonnes by 2010",

which is exactly what the amendment says.

The DEFRA website lists the target under the Home Energy Conservation Act 1995 as a 30 per cent. improvement in 10 to 15 years, using the baseline of 1 April 1996. Taking that as its lowest—30 per cent. over 15 years, based on 1996 levels—it is virtually the same as 20 per cent. over 10 years, as in the Lords amendment. Indeed, the Energy Saving Trust—the Government's own adviser—does not know why the target has been changed to 16 per cent. It has been completely surprised by the sudden decrease and has said so publicly, as it has worked on the policies to achieve the higher figure of 20 per cent. In evidence to the Environmental Audit Committee on 19 May, it said:

"We were involved in developing the Plan"

but

"we have to say that we did not have the final decision"

in respect of the reduction

"and we do not agree with it."

As support for the 20 per cent. target will come from Opposition and Government Members, the real issue is why the Government have decided to change the target. After all, the Lords amendment uses the phrase "reasonable steps". I have served on enough Committees to know that "reasonable" is not an unreasonable word to use in legislation. The target does not necessarily have to be achieved, but the Government must take reasonable steps to achieve it. The Lords amendment is not unreasonable. It would set this country's policies in the context of international relations at a responsible level, and it should be supported.

I note that early-day motion 96, on the residential energy efficiency aim pursuant to the Sustainable Energy Act 2003, has accumulated more than 340 signatures. Given that Ministers would not sign an early-day motion, two thirds of all the Back Benchers in Parliament must have signed it. I would not suggest that Members of Parliament would sign any early-day motion lightly on such an important matter that has an impact on the future and sensible energy policies. That shows the breadth of support for the 20 per cent. target. The Lords have given us an opportunity to think again, and I hope that the House will adopt a sensible approach and vote for the 20 per cent. target.

Brian White (Labour, North East Milton Keynes)

The Lords amendment is very important, and I agree with the hon. Member for Poole (Mr. Syms) that their lordships have done us a good service by introducing it. Reference has been made already to the Sustainable Energy Act 2003, which I piloted through the House a couple of years ago, and early-day motion 96, so I want to concentrate on what the Government said in opposing the amendment in the Lords last week, which the Minister has just repeated.

Last week, Lord Rooker said that 4.2 megatonnes is double the historic 1990s level. That is welcome, and we should not lose sight of the fact that there has been a major change. In the energy White Paper, the Government said why the target was important, and they set the aspiration at a 20 per cent. reduction. The problem is that officials began to realise that an historic step change would be required and that a number of issues need to be addressed.

Lord Rooker argued for flexibility and said that the 2003 Act provides a mechanism to increase the level—it certainly does—but that is not a reason why the Lords amendment, which would set a floor, should not be carried. The Lords amendment would set in statute a floor beneath which Government aspirations should not fall. If the Government want to exceed that baseline, they can use the mechanism in the Act to go way above it.

The Minister rightly referred to the action plan, which contains many good points; but, again, that does not negate the need for the Lords amendment. The Government have also argued that we are doing well in the industrial and business sector, so we should be allowed to slip in another sector, but this is not a zero-sum game. Our aspiration should be to exceed the level in every sector.

Lord Rooker also said that the Government have a good tale to tell. The Government are not reneging on their commitments, despite what the Opposition have said, but they are scoring a classic own goal. We have a good tale to tell, but because we are not living up to what we said in the White Paper and we are arguing about 4.2 megatonnes as against 5 megatonnes, we are scoring an own goal for no good reason.

David Taylor (Labour/Co-operative, North West Leicestershire)

Does my hon. Friend not agree that set as we may undershoot our CO 2 emission reduction targets by about 25 per cent., as reported by the Environmental Audit Committee, to pass up what the White Paper called the cheapest, cleanest and safest way to reduce carbon emissions—energy efficiency—seems perverse, to put it mildly?

Brian White (Labour, North East Milton Keynes)

My hon. Friend makes the key point. Energy efficiency is the best and most effective way to achieve our goals. Whether we are talking about tackling climate change, reducing carbon emissions or taking people out of fuel poverty, energy efficiency is a key policy instrument that the Government must use. By embracing the Lords amendment, the Government would be going with the flow, rather than trying to find a justification for resisting it, when everyone interested in the issue knows that the White Paper provided the right aspiration and the right policy.

In May, during the debates on the Energy Bill in Committee, the Minister said that the energy commitment would be reviewed in 2007—he has repeated that today—but he also thought that the non-statutory commitment would lead to a substantial stepping up of activity. Unfortunately, that has not been the case. If I am right and the increase has not been sufficient, not holding the review until 2007, with implementation in 2008, leaves very little time to achieve our goals.

The Minister also said that dialogue with the industry was needed to ensure that the serious disappointment that has been expressed until now does not recur, but that disappointment has been reinforced by the resistance to this very sensible Lords amendment. We have been down this route before with combined heat and power, when we made similar statements with consequences for the CHP industry. We are in danger of doing the same with energy efficiency.

I have often quoted Bryan Carsberg saying that regulators think that if something is not in the statute, it does not exist. What is true for regulators is also true for officials. Such a proposal has been around for a long time. Indeed, it was part of my original Sustainable Energy Bill. When a ministerial reshuffle took place during the consideration of that Bill, officials said that they would oppose it, although it had been agreed before, and their words are etched on my brain:

"That may have been ministerial policy, but it is not departmental policy."

That is the nub of the problem, and those words struck home. If officials do not see something in statute and do not agree with it, it will not happen. There must be a statutory requirement to allow officials to act. That is why the performance and innovation unit's report was so important and why the energy White Paper was so insistent on the 20 per cent. target.

Everyone agrees that the era of low energy prices, which helped to lift millions out of fuel poverty, is over. We are in a different global environment, so we must consider how to take more people out of fuel poverty. At a recent energy company's annual general meeting, someone said:

"The consequences for companies that do not act responsibly and take steps to assess and mitigate risks posed by climate change will be just as devastating as the recent corporate scandals."

What is true for companies is also true for Governments.

Next summer, the UK will hold the presidencies of the G8 and the EU, and the Prime Minister has rightly made tackling climate change a key objective. Never has the old adage "Think global, act local" been so true. If we do not take on board the Lords amendment, we will negate all the words we use and cause problems at home and abroad. It will give our opponents—whether political opponents at home or countries that oppose the Kyoto protocol—the excuse not to take the action that is desperately needed if we are to take climate change seriously.

The Prime Minister is right to focus on the international context next year, but we do not need to erect unnecessary barriers, which we will do if we do not accept the Lords amendment. We can hardly criticise the United State if we seem to run away from a sensible amendment. This ought to be a no-brainer, given the list of people who support the target, which includes the energy industry, energy efficiency companies, campaigners from various non-governmental organisation, Friends of the Earth, Greenpeace, the Women's Institute, Shelter and tenants' organisations.

All the political parties signed up to the proposal—all their green wings have endorsed it—and some 340 MPs from all parties signed up to the aspiration. The wording of the early-day motion was carefully discussed with Ministers and officials, and the figures were checked with officials several times. All of them suggested a figure of 20 per cent, not 16 per cent. The 20 per cent. figure was reaffirmed on 24 occasions, 15 of which were ministerial statements. It was confirmed only a few days before the actual target was announced.

The Minister says that there is only a small difference between targets of 16 and 20 per cent., so why is it a problem to accept the Lords amendment as a basis on which we can move forward? There is a mechanism by which we can go above the target, but we need a statutory floor. Whatever words the Government use, they will send a clear message by disagreeing with the Lords amendment: the matter is not a priority, and the market need not deliver because slippage is okay. That message would be totally wrong. It would go against everything that the Government are trying to do and all the good things that Departments have done.

Brian Iddon (Labour, Bolton South East)

Does my hon. Friend accept that the all-party warm homes group has taken evidence showing that industry wants to invest in products that would lead to greater energy efficiency? That would create jobs, so there would be a win-win situation all round: we would not only reduce CO 2 emissions and the utility bills of people in fuel poverty, but increase jobs in industry.

Brian White (Labour, North East Milton Keynes)

As I say, this should be a no-brainer. I ask the Minister to rethink his position and accept the Lords amendment. I do not understand why he wants to turn the win-win situation that my hon. Friend described into a no win situation in which we would be accused of reneging on commitments. The story that we have to tell is good, and we have made excellent achievements, so we need to seize the opportunity of achieving a long-held Labour aspiration. We should not give our political opponents a stick with which to beat us, or erect unnecessary barriers that would hinder next year's G8 negotiations.

Matthew Green (Liberal Democrat, Ludlow)

The Minister described the figures as a shifting, moving picture. The shifting and moving has been on the Government's part, because they have moved from their stated target of 5 megatonnes of carbon down to 4.2 megatonnes. He says that that would result in a 19 per cent. target on carbon rather than a 20 per cent. one, and asks what everyone is getting so worked up about. I suspect that the figure is closer to 18 per cent. than 19 per cent.—

Alan Simpson (Labour, Nottingham South)

It is 16 per cent.

Matthew Green (Liberal Democrat, Ludlow)

Well, the reduction would be 16 per cent., but the Minister said that the overall effect would be equivalent to a 19 per cent. target. However, if the difference between the targets is so small, why will the Government not agree to the 20 per cent. target? Why is a target of 19 per cent. more achievable than one of 20 per cent.? The Government must know something that the rest of us do not. There must be a reason why a 19 per cent. target can be achieved easily, but 20 per cent. is out of reach. I am struggling to understand what that is, so when the Minister winds up the debate, I hope that he will set out why the Government are confident that they will meet the 19 per cent. target, yet fail to meet 20 per cent. The projections that his officials are making must be really tight to enable him to reach that conclusion.

By my count, at least 150 Labour Members signed the early-day motion—[Hon. Members: "Over 200."] I am being told that the figure is more than 200. [Interruption.] Well, the bigger the number gets, the more uncomfortable the Minister looks. I hope that the Labour Members who signed the early-day motion will back that up with their votes.

There is a lot of good in the Bill—[Interruption.] There are some bad things as well. However, as there is a lot of good in it, we do not want to descend into a process of ping-pong between the Lords and the Commons. The easiest way for us to avoid that would be to accept the Lords amendment. If Labour Members were to stick to their guns, we would not have to send the Bill back to the Lords because we could pass it now. That would get the Minister out of a bind, because it would make the Whips happy if we did not get into ping-pong. The Minister used to be a Whip, so he knows all about that.

Hon. Members have posed good questions already, yet the Minister made great play of the fact that the target in the amendment is only just above the Government's proposal, but if there is such a small difference, the higher target must be achievable, unless he knows something that the rest of us do not. It is very strange for the Government to say that we should resist the amendment because we will get awfully close to the target in it anyway, but that is essentially the position that they have adopted.

I hope that the Minister will make the difference between the targets clear and explain why there is so much at stake that he will resist the amendment. Energy efficiency has been described as one of the Government's key objectives, and proposals have been made by the Cabinet Office performance and innovation unit, so there is clearly support for it high up in Government. The Government's Sustainable Development Commission has used the 20 per cent. figure, and we have heard that it has been cited in letters even recently. I do not understand why the Minister is resisting the amendment. The hon. Member for Milton Keynes, North-East (Brian White) described the decision as a no-brainer, so the Minister must come clean and tell us what is at stake if we change the target from 19 to 20 per cent.

Alan Simpson (Labour, Nottingham South)

We need to put the debate in the context of the best aspects of the Government's record. For the first time in history, the Labour Government gave a statutory undertaking to eradicate fuel poverty in this country by 2016. The Government and the Labour party should rightly be proud of that awesome commitment. Equally, the Prime Minister made it clear to the House that meeting Britain's Kyoto targets was a statutory and binding obligation. He has also said that addressing the challenge of climate change will be the centrepiece of the next Labour Government, so the amendment should be at the heart of what Labour has tried to stand for: taking people out of fuel poverty while meeting our broader global obligations to tackle climate change. It is thus bizarre and somewhat absurd that the Government refuse to endorse the targets in the amendment that successive Labour Ministers have affirmed as Government policy. We are having an "Alice Through the Looking Glass" debate that has been constructed by officials in the Department for Environment, Food and Rural Affairs, rather than Labour Ministers or the Labour party.

The reduction of the carbon target from 5 megatonnes to 4.2 megatonnes has been justified on the ground that it was done on the basis of the best available evidence at the time. People have asked the nature of that evidence and where it came from, but it has not been adequately justified. Our advisers, the Fuel Poverty Advisory Group, said that it was at a loss to understand why the Government wanted to introduce a lower target. I think that in this Bill, as in those that have preceded it, civil servants have been faced with the prospect of targets, but rather than asking how they can meet them, they have asked how they can lower the hurdle. They want to know how they can appear to be meeting Government targets without breaking a sweat. There is a conflict not between different parties in the House, but between the House—it knows the policies that came from the Government—and the civil servants who have the job of writing measures to deliver and implement Government policy. They should not rewrite such policies to give themselves an easier life while leaving everyone else with bigger problems.

The Minister understandably rebuffed the question of whether that would contribute to our ability to choose not to go down the nuclear path by saying that it was not in his remit to address energy industry issues because we are merely discussing a Bill on housing. That is perfectly fair. By the same token, however, he cannot try to shelter from reducing carbon savings as a result of improving household energy efficiency by saying that other savings would be met and exceeded in other parts of industry. We made specific commitments in relation to the housing sector and it is against those commitments that we are being asked to define a position in the Bill.

Hon. Members have counted the number of Labour MPs who signed the early-day motion, with different results.

David Taylor (Labour/Co-operative, North West Leicestershire)

It is 229.

Alan Simpson (Labour, Nottingham South)

It seems that the figure is now 229.

Someone said that it is hard to find a loser, but there are 230 potential losers—the 229 Labour MPs who signed the early-day motion in good faith and the country. Those commitments are not abstract figures. They will affect the quality of life of the most fuel-poor people in the country. The Government need to accept that the challenge that faces us is to stand by the commitments that we have made.

In a letter on behalf of the Department for Environment, Food and Rural Affairs dated 28 October, Alan Clifford of the sustainable energy policy division wrote to Mr. Robson, chair of the Association for the Conservation of Energy and a member of the Government's Fuel Poverty Advisory Group, in an attempt to rationalise why the lower figure of 4.2 million tonnes of carbon emissions was being set. He said:

"the White Paper figure was based on the best information available at the time, and was not a target."

Unfortunately, we are getting into the realms of pantomime. Civil servants may consistently say that the figure was not a target, but other voices in the background say that it was. The Labour manifesto said:

"We will lead the fight against global warming, through our target of a 20 per cent. reduction in carbon dioxide emissions by 2010."

So that target was defined in the manifesto.

The letter went on to say that the energy efficiency action plan, published in 2004, reduced the target to 4.2 million tonnes because that was deemed to be the appropriate figure. So the 5 million tonnes was not a fixed figure. However, when the hon. Member for Truro and St. Austell (Matthew Taylor) asked the Prime Minister:

"Will he make it clear that there is no truth in the interpretation that has been put on the comments of some Ministers that Britain will stick to the new Government's 20 per cent. target for cuts to CO 2 emissions only if other countries co-operate in cutting their emissions? Will he confirm that our target is not conditional on the action of others?",

his response could not have been clearer. He said:

"It is not a conditional target".—[Official Report, 24 June 1997; Vol. 296, c. 687–88.]

We have targets that are defined as unconditional; targets that are defined as a quantum; targets that are defined by a succession of Labour Ministers; and targets that are endorsed, approved and supported by 229 Labour Members. I suspect that the overwhelming majority of local authorities, non-governmental organisations and everyone who works in the environment and fuel poverty sector all envisaged us setting and standing by our targets. The question that will baffle the public is why on earth we would want to renege on them now.

The Minister said that there was a danger that setting the target would create a mood of complacency and we would be held back, but the final paragraph of Alan Clifford's letter nails the lie of that when he says:

"it has always been recognised that additional measures might be needed to achieve the domestic goal of a 20 per cent. reduction in carbon dioxide emissions below 1990 levels by 2010."

By setting the lower figure of 4.2 million tonnes, there is a calculated level of under-achievement in which officials recognise that the Government will be forced to identify other measures. Why do we build in a guarantee of failure to meet the targets that we have set for ourselves when it is within in our reach to do so and to stand by the commitments that we made?

Hon. Members are right to say that the energy efficiency industry waits for us—pleads with us—to set those targets, which it will meet. It is incomprehensible that the Minister asks the House to set lower standards when our original targets are within our reach and we should stand by them. I am not asking him to do a Dolly Parton and stand by our man, but I am asking him to stand by our manifesto, which would be welcomed by the public and the party.

Sir Sydney Chapman (Conservative, Chipping Barnet)

I shall be brief because I agree with every word my hon. Friend the Member for Poole (Mr. Syms) and the hon. Members for Milton Keynes, North-East (Brian White), for Ludlow (Matthew Green) and for Nottingham, South (Alan Simpson) said. I declare a possible non-financial interest. For many years, I was a qualified architect, but for much of that time I was off the drawing board and now receive no income from my erstwhile profession. Indeed, I said in Committee and before that I have a reverse interest to declare because for years I paid professional subscriptions to the Royal Institute of British Architects to no avail.

I feel a sense of sadness about the proposal. I honestly do not think that there was any need for the Government to resile from their commitment to improve energy efficiency by 20 per cent. by 2010 on 2000 AD levels. They have made a tactical mistake, and I shall set out why. As hon. Members have said, they repeatedly assured us that that target would be set. My hon. Friend the Member for Poole said that they repeated that 15 times. The target has got into the public psyche, which is good and heart-warming. It has also been fully supported by the Energy Saving Trust, the Sustainable Development Commission, the Government's official advisers and at least two other Departments—the Department of Trade and Industry and DEFRA. I cannot understand why the Office of the Deputy Prime Minister has suddenly decided to revise it.

The plan is to save 4.2 megatonnes of carbon rather than 5 megatonnes. That is a reduction of 16 per cent., which is significant. However, as other hon. Members said, the revised target means that we will hit only a 19 per cent. overall improvement in energy efficiency instead of 20 per cent. by 2010. Overall, the House supports the Government in the early-day motion that has been tabled. I hope that the number of Labour Members who support the proposal does not increase, as that detracts from the all-party nature of the issue, for which there is general support. I shall not be here in 2010, but if I am correct, my colleagues, whether they belong to the Government or the Opposition, will not feel a sense of triumph if the Government fail. There will be a sense of sadness, combined with respect for the fact that the Government kept to their original target. Even at the 59th minute of the 11th hour, I beseech the Minister, for whom I have a very strong regard, to change his mind or seek to persuade the Government to do so.

In conclusion, the Government have set myriad targets—some people may say too many—throughout the field of government. I am a member of the Public Administration Committee, which produced a report on Government targets. We may have complained that there are too many targets, some of which contradict others, but we have never suggested that pinpointed targets are anything other than a good thing for the Government to try to achieve. If the Government do not accept the Lords amendment, which was tabled by Baroness Hanham on 3 November, they will detract from the efficacy of their target-setting policies. I beseech the Minister, who represents Streatham—I must remember not to say "St. Reatham"—to reconsider his position, as he will win tremendous all-party support not only from hon. Members but from the public at large, persuading them that we take the issue of energy savings and energy efficiency very seriously indeed.

Joan Walley (Labour, Stoke-on-Trent North)

I shall make a brief speech, as I hope that in his reply the Minister will take on board the many points made by Members on both sides of the House.

I religiously signed the early-day motions because I believed in them and in the original target. We must be careful not to devalue targets by suggesting that a target that cannot be met provides a perverse incentive and undermines the system. Many hon. Members passionately want the original target to be met and to be applied to energy efficiency. My hon. Friend the Member for Milton Keynes, North-East (Brian White) set out our aims clearly, and I urge the Minister to persuade the Government to address the reports and debate on the issue. If the target cannot be included in the Bill, will he give us an assurance that we can meet what we set out to achieve—the basic floor target of 20 per cent. savings?

Tony McWalter (Labour/Co-operative, Hemel Hempstead)

I am sure that, like us, the Minister is strongly in favour of abolishing fuel poverty and meeting achievable targets on insulation with a hard-working programme. I do not believe that that is at issue. However, I would like to know why he believes that it is inappropriate and wrong to include the 20 per cent. target in primary legislation. Does he fear, for instance, that the Government could be taken to court gratuitously if the Lords amendment is accepted? Would a lot of legal time be taken up defending slow-burning Government programmes? Why does he agree with everything that has been said in favour of the target, but object to its inclusion in primary legislation?

Bill Tynan (Labour, Hamilton South)

I will not delay the House long, as I merely seek clarification.

It is obviously difficult for the Government to change their mind. Had the Bill received pre-legislative scrutiny, they might have been able to do so. However, once a Government have decided to push through a measure, it is usually impossible for them to change their mind.

I have just one question for the Minister. The Lords amendment says that

"the Secretary of State shall take reasonable steps to ensure an increase in residential energy efficiency of at least 20 per cent. by 2010 based upon 2000 levels."

Will the Minister clarify the Government's position? Is it that he supports the target but does not want to include it in the Bill? His reply will help hon. Members who signed early-day motion 96 to consider their position before voting against the Government.

Keith Hill (Labour, Streatham)

Let me provide immediate assurance to my hon. Friend the Member for Hamilton, South (Mr. Tynan) that the Government support the 20 per cent. target and, indeed, as I have argued, we are in the process of meeting it.

I am alarmed by the tone taken by some of my hon. Friends. There is no hidden agenda or conspiracy. May I tell my hon. Friend the Member for Nottingham, South (Alan Simpson) that the Government have not reneged on their commitments—we are delivering on them, as I have previously said, and as I shall go on to demonstrate. I respect the expertise of my hon. Friend the Member for Milton Keynes, North-East (Brian White), who protested that we have not accepted the terms of the amendment, even though, somehow, we have already agreed to its substance in legislative form. We have not done so, but we are not withdrawing or resiling from our commitments. To be entirely accurate, the figure of 5 million tonnes of carbon savings in the residential sector was never the Government's stated aim, but an initial indication in the energy White Paper of what could be achieved. However, our record stands in its own right. The 4.2 million tonnes of carbon savings that have been mentioned in our debate represent a significant increase in activity on current levels, and will require a major increase in delivery by the industry. Our latest calculations indicate that that total corresponds to an increase in efficiency of about 19 per cent. compared with 2000 levels.

Anne Campbell (Labour, Cambridge)

Will my right hon. Friend give way?

Keith Hill (Labour, Streatham)

No, I am afraid that I do not have time.

We expect a significant increase in overall carbon savings from energy efficiency. The energy efficiency action plan details measures to make estimated carbon savings of 12 million tonnes of carbon—a 20 per cent. increase compared with the rough figures in the energy White Paper, which predicted savings of 10 million tonnes of carbon to 2010. I repeat, therefore, that we are genuinely succeeding in meeting our energy efficiency targets, so the Lords amendment is simply unnecessary. There are no grounds for doubting the Government's commitment and we are getting there by making carbon savings across the board.

My hon. Friend the Member for Hemel Hempstead (Mr. McWalter) raised the relationship between energy efficiency targets and fuel poverty. He will know that that relationship, about which colleagues and I share serious concern, is not unilateral. We will have an opportunity to debate it later this evening, but I remind him that measures in the energy efficiency action plan play an important part in combating fuel poverty. As he and the House will know, there has been a steady reduction in the number of households in fuel poverty, which we can discuss in more detail later. However, I remind the House that the fuel poverty action plan for England, which will be published later this year, will set out how the Government expect to meet the target of eradicating fuel poverty in vulnerable households by 2010. I therefore invite the House to disagree with the Lords amendment.

Clause 137 — Duty to have a home information pack

Keith Hill (Labour, Streatham)

I beg to move, That this House disagrees with the Lords in the said amendment.

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

With this we may discuss Lords amendments Nos. 130, 135, 137, 143 and 144 and the Government motions to disagree thereto.

Keith Hill (Labour, Streatham)

It is a matter of great regret to me that the issue of home information packs has remained so contentious between the parties, especially when there has been such broad consensus about the Bill and we have been able to work so well together. That applies not least to work between the Government and the Liberal Democrats in improving the Bill, especially the provisions on empty homes and tenancy deposits.

The amendments would replace a compulsory home information pack scheme with a voluntary one. The notion of voluntarism is seductive and there was much talk in the other place of the reforms being an unjustified restriction on people's right to buy and sell homes as they please in a market that functions perfectly well as it is. However, those of us who inhabit the real world know that that is not the case. The home buying and selling process does not function properly. Hundreds of thousands of people every year are put through the wringer because of the inadequacies of the current system. Hundreds of millions of pounds are wasted on transactions that get nowhere. That is money that ordinary, hard-working families can ill afford to lose.

Three out of 10 sales fall through between offer acceptance and exchange of contracts and more than half of all sales experience some sort of problem during that period. It is no wonder that, whenever they are asked, people say that they are hugely dissatisfied with the current system. Nine out of 10 people said that in one independent survey last year. That is hardly a ringing endorsement for a system that is supposed to work well.

I do not doubt that some people are doing very nicely out of the system. Every cloud has a silver lining and the abortive costs to consumers from all those failed transactions represent a nice little earner for others. Needless to say, they are not the people for whom the reforms are designed, although many in the industry welcome what we are doing and are keen to get on with it. For them, the reforms are overdue and liberating, enabling them to offer the sort of service that their customers want.

David Kidney (Labour, Stafford)

Will my right hon. Friend give way?

Keith Hill (Labour, Streatham)

Of course I shall give way to my guru on home information packs and so much else.

David Kidney (Labour, Stafford)

Surely my right hon. Friend does not suggest that the lawyers and estate agents who object to the home information packs are the ones who benefit from an inefficient system.

Keith Hill (Labour, Streatham)

As I was wont to say in my previous incarnation as deputy Chief Whip, my hon. Friend may say that but I could not possibly comment.

Opponents of compulsion should recognise that relying on voluntarism would mean things staying much as they are. That is because a voluntary HIP system will not achieve the universal acceptance needed to make it work properly. The amendments are really about removing part 5 from the Bill, thus leaving the housing market unreformed and damaging not only to individual buyers and sellers, but to the national economy. Too many people are disadvantaged for us to ignore the problems and settle for the status quo. We are determined to offer consumers a genuine prospect of change. That cannot be done through relying on voluntarism and good will alone.

Peter Bottomley (Conservative, Worthing West)

Will the Minister give way?

Keith Hill (Labour, Streatham)

I shall, but I have much to say and relatively little time in which to say it. I also want to allow other hon. Members to speak.

Peter Bottomley (Conservative, Worthing West)

The Minister is trying to reverse a Lords amendment and get the House's approval for that and I am grateful to him for allowing me to ask a question. If I approach someone who is not planning to sell a home and ask them whether they will sell it to me, is it lawful for them to do that without providing a home information pack?

Keith Hill (Labour, Streatham)

The answer to that is an unqualified yes.

Of course, there are a few agents who have sought to progress on the basis that I have described. They report none of the dire consequences predicted by the Opposition, although they are frustrated that others can reap the benefit of their efforts without having to do very much. In a buoyant housing market, that is not surprising. In a downturn, they might need to work harder, but unless they pull in the same direction, more effort can be ineffective.

All markets work most efficiently when all the parties are well informed, and the housing market is no exception. Nobody disputes that. The home information pack will deliver that for home buyers and sellers. We do not need a Bill just to have a voluntary system of home information packs. Sellers and estate agents are free to provide them now if that is what they want. However, despite the evidence that they can greatly reduce the chances of transaction failure, they have not gained a sizeable foothold in the home buying and selling process. There are very good reasons for that.

The main problem with a voluntary scheme is chains. If any link in the chain is without a pack, the whole chain would suffer if that were to be the cause of problems. If packs are not made compulsory, one individual who decides to opt out can wreck the process for everyone else. We also know that estate agents in the high street are fiercely competitive, and without compulsion, most of them will be tempted to offer the easy option. Without the level playing field that a compulsory scheme will bring about, most estate agents, even those sympathetic to HIPs would look at what their competitors were doing and would not act for the greater good of consumers if they felt that it would put them at a commercial disadvantage.

There have been accusations that the introduction of compulsory HIPs will mean a huge reduction in the number of properties going to the market and that that will result in massive house price inflation. That would be scary if it were true, but it is just the usual scaremongering. The introduction of similar changes in Denmark and New South Wales had no effect on the market. That view is also supported by research commissioned by the UK's largest estate agency group—the Countrywide group—which suggested that there would be little impact on the number of homes sold. The Countrywide study found that, even if sellers had to pay up front for the pack, 87 per cent. would still offer their home for sale. It concluded that the pack would take out of the market only the people who were not serious about selling anyway.

Simon Thomas (Plaid Cymru, Ceredigion)

According to my understanding of the proposals, the Minister will decide at what stage to commence this part of the Bill. Will he tell us how he would do that, because that decision would have an impact on the market? Will he introduce the provision throughout the United Kingdom overnight, or will it be piloted in certain areas—perhaps in Wales; why not?—and what ideas does he have about ensuring that it will actually work?

Keith Hill (Labour, Streatham)

The hon. Gentleman has been a good supporter of this proposal, and he is articulating a reasonable concern about its implementation. After all, there are few things in life more important than a person's home and their acquisition of it. I can give him an absolute assurance that we shall not bring this system in until we are absolutely clear that it is going to work. We envisage various kinds of dry run to ensure that it is working properly and I hope to talk about that in due course, in a way that I hope he will find helpful.

I was saying that there had been accusations that the introduction of compulsory HIPs would mean a huge reduction in the number of properties going to the market, and that the evidence was that there would be no such reduction. Indeed, I pray in aid on this matter no less a figure than Kate Barker of the Bank of England's Monetary Policy Committee, who has spoken about the problems of the current home buying and selling system and about how HIPs will help. In her recent report on housing, she said:

"An efficient housing market depends on buyers and sellers having available to them accurate and comprehensive information about individual properties as early as possible. This is often not the case at present, and as a result many transactions fail or take longer than necessary."

She went on to say that HIPs would address that market failure and should reduce the risk of transaction failure and speed up the buying and selling process, provided that they were properly researched with the industry and consumers. We certainly intend to do that. She finished by saying of HIPs:

"I welcome the greater transparency that they are expected to bring, and would not anticipate that there will be an impact on house prices as a result of their introduction."

John Butterfill (Conservative, Bournemouth West)

Will the Minister tell me what particular expertise Kate Barker has in the home buying and selling markets?

Edward Davey (Liberal Democrat, Kingston and Surbiton)

She is a macro-economist.

John Butterfill (Conservative, Bournemouth West)

She is, but I do not know whether she has any great expertise in this area.

Keith Hill (Labour, Streatham)

If the hon. Gentleman had read Kate Barker's report on housing—he might well have done so—which was commissioned jointly by my Department and the Treasury, he could not have helped being impressed by her deep understanding, the great extent of her expertise and the enormous trouble that she took to analyse the housing market and to get these things right. I do not know which authority the hon. Gentleman wants to promote in opposition to Kate Barker but, frankly, I am content to rest on her judgment that this system would not impact on house prices in any negative sense, and that it would make the housing market more efficient.

The provision of more and better information cannot help but improve the functioning of the housing market, although I do not pretend that it will solve every problem. We accept that our proposals are not a panacea. However, every examination of these problems by Governments over the past 30 years—and there have been a number, in case anyone is labouring under the delusion that these are new problems—has concluded that this would be the most helpful change. My noble Friend Lord Rooker listed some of those conclusions recently in another place. There was the Law Commission report on subject-to-contract agreements, which was laid before Parliament as long ago as January 1975. Then there was the first report of the Conveyancing committee in 1984, better known as the Farrand report. The previous Conservative Government's report, "Survey of options for simplifying the house purchase process", published in 1993—I presume under the auspices of the right hon. Member for Suffolk, Coastal (Mr. Gummer), who is in his place—responded to concerns about inefficiencies in the market and concluded that sellers should provide property details at the outset and that conveyancers could reduce the uncertainties of chains by encouraging a greater disclosure of information.

None of this is new. The problems are not new and the solutions are not new. What is new is that we now have a Government who have the courage to do something about it, even if that means upsetting a few interests along the way. While I am on the subject of interests, let me draw to the attention of the House a couple of interests that have recently come out in support of the Government's proposals. As a Labour man, I have been reading The Guardian devotedly for more than 40 years, although nowadays, opening my copy often feels like a somewhat masochistic exercise. To my delight, however, I saw that the editorial in the edition of Saturday 6 November contained a most enthusiastic expression of opinion in support of the Government's proposals on home information packs. And, lo and behold, in The Times of Friday 5 November, the excellent Susan Emmett, its deputy property editor also wrote enthusiastically about the ending of what she described as "this tortuous process" of home sale and purchase. If I had more time, I should certainly draw these serious observations to the attention of the House. I shall spare hon. Members that experience now, although I might get the opportunity to do it later. I will simply say that when the muesli and sandals brigade lines up with "The Thunderer" in joint support of the Government's proposals, those proposals must be taken very seriously.

Unlike the Opposition, we have a coherent view of what is needed to create a sustainable housing market. Apart from making an effort to balance the supply and demand for housing responsibly, we want to ensure that the existing stock is maintained and kept in good repair for future generations. We want to see people taking responsibility for their stewardship of the housing stock, including its upkeep and energy efficiency. They can do that only if they have the necessary information at the right time and in the right place.

John Gummer (Conservative, Suffolk Coastal)

The Minister mentions energy efficiency. I wonder why. My concern is that the Secretary of State is taking powers whereby he "may" do this, that or the other. Why did he not state categorically from the outset that he would institute a mechanism whereby the proper energy efficiency rating of every house could be presented, enabling people to make a comparison?

Keith Hill (Labour, Streatham)

The right hon. Gentleman entices me on to the next phase of my exposition of the virtues of our proposals, but I am surprised that he, as a good European, is unaware of European Union directive 2002/91/EC, which makes such an energy efficiency report mandatory.

John Gummer (Conservative, Suffolk Coastal)

I was inviting the Minister to explain why the Secretary of State did not take credit for this, as is his wont, by getting it in the original documentation.

Keith Hill (Labour, Streatham)

The right hon. Gentleman will have to put that down to my innate modesty. After all, he will acknowledge that I have not attempted to replace the concept of the Gummer exception with the Hill exception. This is a rather arcane exchange, albeit one that we have both enjoyed.

The Opposition have failed to make any link between their laudable demands for more and better use of the existing stock in creating sustainable communities, including higher energy and other standards, and the crucial role that HIPs will play in achieving those ends.

As I was saying to the right hon. Member for Suffolk, Coastal, we shall have compulsory energy surveys when properties are sold; the EU directive to which I alluded requires that. It is entirely consistent with the primary need to use energy supplies more efficiently and is something that the Opposition fully support, but they clearly have difficulties with the means.

Let me take the House on a tour of some questions that need to be addressed to meet the energy certification requirement and the information that the inspector carrying out the survey will need to gather as he or she goes around a property to complete the energy report. The questions include: is it a flat or a semi-detached, a mid-terrace or detached house? When was the property built? Are there any extensions or modifications, and when were they made? What are the walls in the main property or any extension constructed from? Is there any evidence that the walls have been modified, possibly with cavity fill insulation or external insulating render? What is the floor construction? What types of window and glazing are installed? What is the roof construction? Is there a porch or a conservatory or a basement; if so, how big is it, and can it be closed off from the main part of the house and does it have a separate heating system?

For each storey of the property, the inspector needs to measure the floor area, the room height and the length of wall through which heat can escape either to the outside world or into unheated spaces such as a garage, and the area of windows, doors and rooflights.

I put it to the House that this is already starting to sound like a fairly sophisticated assessment, but the requirement goes much further because the following questions must also be addressed: what type and thickness of insulation is there in any loft space? Is there gas or electricity available in the property or in the street? What ventilation rate can be expected in normal circumstances? What space and water heating systems are installed? What controls are there on those systems?

This is not just a question of, "Is it a gas central heating boiler or not?" Instead, the requirement is to determine whether it is a standard boiler or a combination boiler, and whether it is a condensing boiler; how efficient it is; and whether there is a timer, a room thermostat or thermostatic radiator valves. That assumes that the system in question is a straightforward gas system, but it can get a lot more complicated if it is not and the means of heating is from other fuels or local heaters rather than central heating.

Undertaking an energy efficiency assessment is a skilled task, requiring a qualified individual to look at all the key elements of the property such as walls, floor, roof, glazing, space and water heating, and services—in fact, pretty much every element that we are proposing should be considered in the home condition report.

The time required on site to perform an energy efficiency assessment using the reduced data standard assessment procedure methodology would be an hour to an hour and a half, with a relatively short period for subsequent preparation of the report. That compares with an anticipated two hours on site to undertake a full home condition report, plus up to an additional hour to write up the report.

John Butterfill (Conservative, Bournemouth West)

The Minister is being very generous in giving way, but I am not sure that he fully understands what is likely to be involved in such a report. I speak as a chartered surveyor. To cite an example that occurs frequently, if a building has tile hanging on the exterior, there should be some insulation between it and the plaster walls on the inside—an older property may have lath and plaster—but it is not possible to tell without removing either some tiles from the exterior or some plaster work from the interior whether there is any suitable insulation material between them. That would require considerable work and a labourer on site, and the damage would have to be made good. Even that one element of the report could not be completed in an hour and a half.

Keith Hill (Labour, Streatham)

It is perfectly clear that the work that has to be carried out for the energy report and inspection is very much akin to that which needs to be carried out for a home condition report. It is, effectively, a medium-level survey. Quite frankly, it is a sight better than the drive-by survey that is so often done by those who carry out surveys and valuations. I accept, of course, that more detailed work is required in some circumstances, but I make the point that we already have a compulsory system of energy assessment, which will require little by way of add-on—in terms of what needs to be looked at or time—to produce a home condition report.

How long would it take to finalise a stand-alone energy report? We think it would take three to five days—the same time as we expect it to take to get a home condition report and, indeed, assemble the whole pack. So, frankly, the Opposition are offering no time savings. This would also scupper the possibility of first day marketing—another Opposition shibboleth—given that the energy survey has to be made available to enable potential buyers to make comparisons with similar properties.

Edward Davey (Liberal Democrat, Kingston and Surbiton)

The Minister has spoken in some detail about what would be in such an energy audit, but will he go to the key point? The directive requires that to be done by the time the property is sold, not at the point of marketing. That is the difference between the parties, I believe. We have no objection to energy audit being compulsory and having to be done before sale—that is what the directive requires—but producing a system under which all has to be done before the house is marketed is the genuine big problem here. It will cause so many difficulties in the housing market.

Keith Hill (Labour, Streatham)

It seems to me that the hon. Gentleman really is splitting hairs. The fact of the matter is that the work on the energy report has to be done in any circumstances. It has to be done by the point of sale. Why not? What reason is there not to conduct that exercise at the beginning of the process? After all, presumably nobody knows exactly when the point of sale will be. There is absolutely no reason for that work not to be done.

One corollary of the home condition report system is that the period of sale will be considerably reduced because all the information that is required and which takes time to acquire in a normal house sale will be provided up front. So, it seems to me that the hon. Gentleman is not raising a significant reservation.

I am aware that I have spoken for some time, so I want to deal with some issues that have been raised and perhaps come back to offer assurances of the sort that the hon. Member for Ceredigion (Mr. Thomas) is looking for. The question is often raised that this is an unreasonable imposition on the house seller and those involved in the process. An energy report is essential, but how much will that cost? The industry estimates that a free-standing energy survey will cost at least £150, yet for another £150 sellers and buyers could have a full home condition report and thereby help to solve the problem of the 43 per cent. of failed transactions that result from an unfavourable survey. I would say that that is a good deal, and I firmly believe that buyers and sellers would agree if they were told the facts as distinct from the fiction.

I keep reading, and the Opposition keep stating, that these provisions will force every house seller to pay £1,000 for a pack. Never mind that the cost is nearer £650, of which £300 will buy the seller the full condition report, including the energy assessment—and never mind that many of the costs are incurred now. What about the benefits? There will be savings to the buyer from fewer mortgage lenders' valuation inspections—exactly how many fewer we do not yet know, but those are commercial decisions that lenders will take in the light of their confidence in the packs and their own plans.

We should not forget that the market is likely to drive down costs. The price of HIPs will be driven down by competition. Last week, Rightmove, members of whose property portal site make up half the entire estate agency market, announced that it is gearing up to provide at least 500,000 packs a year from 2007. That is not far off a third of the total requirement for packs—and that is from just one company, albeit one backed by the Halifax, Countrywide Assured, Connells and Royal Sun Alliance. We know that other players have similar plans.

A number of independent agents have expressed interest in the Rightmove initiative. Critics of our proposals suggest that small estate agents stand to lose out under HIPs, yet here is an example of an initiative that will provide packs for the whole industry, including small agents.

The House will be aware that I have announced that our aim is to introduce these reforms in January 2007. However, I have also made it plain that the reforms will not be implemented until everything is in place and ready to go. We will, of course, take our lead from the industry on that. In that respect, our proposals for a dry run of the home information pack will help everyone to judge the readiness of the market.

To help to ensure a smooth and successful introduction, the Government intend to facilitate a dry run of the full HIPs scheme on a voluntary basis throughout England and Wales from mid-2006. During the dry run, all the components of the statutory scheme will be available for the industry to test and make ready their systems ahead of the introduction of the compulsory scheme. We regard that as a crucial part of our implementation strategy. With the industry, we will closely monitor the dry run and identify any problem areas. If necessary, any problems will be addressed through regulations before the national scheme commences. The flexibility built into the Bill ensures that that can be done quickly.

It was suggested in the other place that the dry run should include a compulsory element in a designated area. Again, the provisions of the Bill are sufficiently flexible to allow that approach. I am happy to consider that further with the industry.

We have no intention of rushing headlong into this with our blinkers on and without any regard for whether the market is ready and the new system works. There is no basis for that sort of accusation, which has been made on other occasions. We are flexible on the issues that several Members have raised, such as the implications of the new compulsory system for low-value homes and for people who are moving out of home ownership, such as the elderly, who will not gain directly from a HIP prepared on another property. There will be open and frank discussion about such matters before the final shape of the scheme is settled.

The housing market is not functioning properly. Consumers—buyers and sellers—want change. We have said that we will deliver that, and have confirmed it in two general election manifestos. The changes cannot be delivered on the scale that is needed under a voluntary system. Compulsion may be regrettable, but in this case it is necessary.

John Hayes (Conservative, South Holland and The Deepings)

I have seldom heard a Minister expend so much energy so inefficiently. For half an hour, the Minister for Housing and Planning regaled us with his accounts of the glories of home information packs, without addressing a single argument that had been made persuasively by Liberal Democrat peers—I do not often say that—Cross Benchers and, most notably, Conservatives in the other place. The truth is that home information packs, or sellers packs, as they have become known, are not needed and not wanted.

Let me reciprocate the generosity that the Minister displayed at the beginning of his remarks. It is true that the Bill includes many good proposals, and we discussed some of those at length in Committee, but this proposal is not one of them. Extraordinarily, it is against all advice, and the Opposition parties are united on this, although I demur from including the Welsh nationalists, who, I understand, at least from what the hon. Member for Ceredigion (Mr. Thomas) just signalled, are on the fence.

The other place debated the proposal at great length, and peers of all parties both voted for the amendment and made the case against the Government's position. Despite what the Minister says, there is no widespread demand for sellers packs from buyers and sellers. The only people whom he could cite in support of his contentious—I say that advisedly—proposals were people in New South Wales, people in Denmark and Kate Barker, who was doing the Government's bidding anyway. She was hardly likely to come out and say that they were wrong, when she was commissioned by them to say that they were right. The evidence that the Minister has brought before us is not in any way convincing.

David Kidney (Labour, Stafford)

Perhaps my right hon. Friend the Minister was therefore remiss in not repeating, as he did in Committee, that the Consumers Association is a strong supporter of the proposal on the grounds of consumer protection. Is not this proposal necessary to ensure that everybody who buys a home gets the speediest possible service and all the information that they need before signing a cheque for a whacking great price for their house?

John Hayes (Conservative, South Holland and The Deepings)

I will address both those points, on speed and the quality of information that people receive, in my brief remarks. The hon. Gentleman's point on the Consumers Association is a fair one, and as ever, he makes a good argument. It is a great pity that the Minister, in the full half an hour for which he spoke, was not able to cite it himself, as it was considerably more persuasive than any that he made.

The Minister said that the sellers packs are in response to popular demand, and that the market is not working. I am not convinced. The amendment goes to the heart of the contention over sellers packs. What is the position of the other place, and what is the Government's position? The Government say that everyone will be obliged, by law, despite the run-in period to which the Minister refers, to spend up to £1,000 when selling a house, regardless of the value of that house. In return, they will gain a sellers pack. Let us imagine someone who puts a modest house worth, say, £60,000 or £70,000 on the market, and who must then withdraw it from the market and re-market it some time later. We have no assurance from the Minister that the sellers packs will last any great time. We are told, as the other place debated at some length, that they may be valid for as little as three months. In the scenario that I just described, the person would have to purchase two sellers packs costing up to £2,000 for the sale of a £60,000 house that they might not sell anyway.

John Gummer (Conservative, Suffolk Coastal)

Has not my hon. Friend noticed that the Minister prayed in aid the perfectly reasonable statement that an energy audit of a house is needed? He did not mention, of course, that that would last significantly longer than the pack, and that it had a rigour that meant that it was of use to the purchaser, whereas the sellers packs are so lacking in rigour that they will more often lead purchasers astray than be likely to give the kind of information that they would want?

John Hayes (Conservative, South Holland and The Deepings)

As ever, my right hon. Friend makes an apposite point, with his usual skill and charm. The picture, however, is even worse than he paints it.

I suspect—and the Minister has yet to convince us otherwise—that people will commission additional surveys to supplement these inadequate reports. I invite hon. Members to imagine that they are buying a property and are presented with a sellers pack containing basic information, and to imagine their suspicion about the paucity of that information—and their desire, in the case of an older property or one featuring particular difficulties, to obtain information that is as detailed as possible. I suspect that they would arrange their own survey. Not only will there be a sellers pack floating about; for the reasons my right hon. Friend has given, additional surveys may well be commissioned. Indeed, I suspect that the sellers packs will prompt additional surveys rather than replacing surveys.

Edward Davey (Liberal Democrat, Kingston and Surbiton)

Many lenders have not said that they will rely on home-commissioned reports. Many will have their own valuations carried out. Moreover, it should be noted that house sales fall through mainly because of valuations done by lenders, as opposed to surveys undertaken by buyers.

John Hayes (Conservative, South Holland and The Deepings)

The hon. Gentleman is right, and I shall return to his point if I have time.

John Butterfill (Conservative, Bournemouth West)

Is there not a great danger that some large firms of estate agents that claim they will co-operate will do so because many poorer vendors cannot afford packs up front? The estate agents will say, "We will supply you with a pack, and when we have sold your property, we will knock the cost off the proceeds of sale." The poor vendors will then be locked into the clutches of estate agents who, in some instances, are quite unscrupulous. They will not be able to change from an estate agent who does not perform properly, because they will have a debt to the agent who supplies the pack.

John Hayes (Conservative, South Holland and The Deepings)

That is a good point. As was mentioned in Committee, in other countries there are strict regulations—indeed, laws—preventing such a possible conflict of interests. In this country, that does not apply, and the Minister has given no guarantee that it is likely to. I think that there may well be real issues of probity. Such issues were raised in the other place, and they were raised by Conservative and Liberal Democrat spokesmen in Committee. Once again, however, we hear nothing from the Minister, despite the length of his speech.

The Government say that the proposal will speed up the process, and the hon. Member for Stafford (Mr. Kidney) repeated that claim. But the Lords, including Lord Donaldson, say that it may have the opposite effect—that it is likely to slow down the process.

Let us imagine another scenario. Someone may want to put his house on the market quickly. He has in mind a potential buyer, perhaps a person he knows in his locality. He will not even be able to begin the transaction until he has commissioned and put into effect a sellers pack. If neither party has demanded that, it is nonsensical to suggest that it is likely to speed up the market and make it more efficient.

The Government say that sellers packs may cost only £600, but we know that they will not be introduced until 2007. We know that by the time they have become compulsory, things will have moved on. We know that there is no cap on the total price of the packs. The Minister's blithe statement that competition will drive the price down flies in the face of all our experience of buying and selling houses, and of commissioning reports of one sort or another concerning the condition of those houses.

The Government say that sellers packs will remove the need for other surveys, but as the hon. Member for Kingston and Surbiton (Mr. Davey) said, mortgage lenders have given no assurances of their willingness to accept them as an alternative to their own surveys. Indeed, the Council of Mortgage Lenders has made clear that it is not prepared to give any such guarantee on behalf of its members. The Minister could not name a single lender that had given an equivalent guarantee. He said that they were all geared up to writing them and were starting businesses in order to roll them out, but that is no surprise, is it? No doubt sellers pack millionaires will emerge from this. That will be the Minister's legacy.

The Government say that sellers packs should be compulsory. In the other place, Lord Hunt described the compulsion issue as the key question. If the packs are such a good idea, why do not the Government trust the people and allow them to say whether they want them or not? If the packs are to replace any other surveys, including those required by the companies offering mortgages, why do the Government not allow them to be voluntary?

The case made by peers throughout the other place was convincing. They said, much as we did, that the Government had failed to persuade anyone of their argument, and we heard the reason for that at the very end of the Minister's long speech. He said that they were obliged to do it because it was in two manifestos. For once, the Government are sticking to a manifesto commitment. That is an unusual and welcome change from common practice.

The Government said that they would do this, and despite all the evidence they intend to do it. In effect, they are saying, "We don't know for how long the sellers packs will be valid, we don't know who will accept them and we don't know what they will cost, but we will impose them on you anyway." They are wrong, the Lords are right, and we will support our noble Friends and other Members of the other place who have championed the cause of sellers and buyers in opposing these silly packs.

Edward Davey (Liberal Democrat, Kingston and Surbiton)

In the three minutes that remain, may I try to be helpful to the Government?

Lord Rooker said in the other place:

"I realise that ours is a high-risk strategy . . . The fact that 40,000 dwellings are marketed every week means that if we get our provisions wrong, the Government are in deep trouble."—[Official Report, House of Lords, 3 November 2004; Vol. 666, c. 355.]

I believe that the Government should be a little more cautious. They should think about the risks not just to them but to the millions of home buyers up and down the country. This really is a gamble. The Government have more or less admitted that they will arrange pilot schemes and a voluntary period, but they need to go much further.

The real danger is that the housing market could grind to a halt in some areas, and purchase costs could rise significantly. That could damage not just the economy but many individuals.

Lord Hunt of Wirral quoted comments by the late Earl Russell in one of his last speeches in the other place:

"There is necessarily a place for compulsion, but it is an unpleasant, expensive and labour-intensive process that will not become easier while the Chancellor is engaged in reducing the number of civil servants. So where something can be done voluntarily and compulsion rendered unnecessary, it is a good thing". —[Official Report, House of Lords, 21 July 2004; Vol. 664, c. 270.]

Earl Russell was right. There is no need for compulsion. There is no demand for it. It will be a costly mistake if the Government push ahead.

I hope that the Government can, through the discussions in this and the other place, put into the Bill the notion that it will keep the home information packs voluntary until another order comes before Parliament. The Minister made great play of the promises in the manifesto. If he reads it again, he will find that the Labour Government promised only to introduce home information packs. Nowhere in the manifesto does it say that they should be compulsory. With the support of the Opposition, the Government could meet the manifesto pledge by keeping the proposal voluntary. Then they will get the support of all parties and of both Houses.

John Butterfill (Conservative, Bournemouth West)

On a point of order, Mr. Deputy Speaker. It may have come to your attention that the timetabling of the debate on that group of amendments was such that not only did no Back Bencher on either side of the House have the opportunity to speak, but even the Opposition Front-Bench spokesmen were obliged to curtail their speeches on probably the most contentious clause—indeed, possibly the only contentious clause—in the Bill. Perhaps you, Mr. Deputy Speaker, could rule on that, and those in another place may wish to take it into account when the Bill goes back to them.

Michael Lord (Deputy Speaker, Central Suffolk and North Ipswich)

The hon. Gentleman knows that I cannot rule on that matter now; those arrangements were agreed by the House earlier. However, he has got his point on the record and no doubt it will be read by those who are interested in such matters.

Clause 145 — Home Condition Reports

Keith Hill (Labour, Streatham)

I beg to move, That this House disagrees with the Lords in the said amendment.

Michael Lord (Deputy Speaker, Central Suffolk and North Ipswich)

With this we may take the following: Government amendments (a) to (d) in lieu of the Lords amendment.

Lords amendments Nos. 123 to 127, 129, 131 to 134, 136, 138, 139, 141, 142, 145 to 150 and 260.

Keith Hill (Labour, Streatham)

It may be for the benefit of the House if I explain that amendments Nos. 123 to 127, 129, 131 to 134, 136, 138, 139, 141, 146, 150 and 260 are technical amendments that clarify or remove ambiguities or repetition in the Bill, and improve the definition of the word "marketing". Amendments Nos. 142, 145, 147, 148 and 149 would make provision for an estate agents redress scheme. I do not propose to dwell on those amendments at great length, as there seems to be a high level of agreement about the proposals in them—although I shall, of course, be happy to return to them if they are raised by other speakers.

Amendments (a) to (d) in lieu of Lords amendment No. 140 would ensure that adequate safeguards are placed on the register of home condition reports. If the House will forgive me, I shall say a few words about those, because this is new matter for this Chamber.

It will be vital for the public to have confidence in the new home condition reports, and a register for home condition reports will help to ensure that. The register will prevent unscrupulous people from tampering with home condition reports once written, because paper copies can be compared with the register. The register will also ensure that the home condition report can be prepared only by a member of the certification scheme. Someone fraudulently passing himself off as a home inspector —or, indeed, a former home inspector who has been expelled from the scheme—will be unable to register a home condition report.

To guard against the possibility of a seller "shopping around" and obtaining a number of home condition reports from different home inspectors, we propose that the home information pack include copies of all home condition reports obtained on the property within the previous 12 months. The register would ensure that that requirement could be enforced. It would be an important resource to help the certification schemes ensure the competence and probity of home inspectors, and that the inspectors were properly insured. Taken together with the checks and balances already in the Bill, this should enable buyers and sellers to rely with confidence on home condition reports.

Geoffrey Clifton-Brown (Conservative, Cotswold)

Will the right hon. Gentleman give way?

Keith Hill (Labour, Streatham)

If the hon. Gentleman will forgive me, I feel that I need to say a few more words in amplification of the proposals for the scheme first, but I will happily give way to him in due course.

Provision is already made for such a register in clause 145(5)(d). The purpose of the amendments is to ensure that that register is kept in a proper way. Amendments (a) and (b) to Lords amendment No. 140 strengthen the provisions for approved certification schemes for home inspectors producing home condition reports. The scheme is required to make provision for the registration of all home condition reports. That will greatly enhance the ability of consumers and others to use the home condition report and to trust it, for the reasons that I shall explain.

Certification schemes would be approved by the Secretary of State. They are likely to be run on a not-for-profit basis by private companies owned by stakeholders. We had initially intended the control of access to information on the register to be left to the terms of approval. However, that might not be legally effective, and might not be sufficient to ensure that appropriate and adequate safeguards are placed on the creation and use of the register.

Amendment (c) inserts after clause 145 a new clause that will ensure that the Secretary of State can make regulations allowing any private keeper of the register to restrict access to it to certain limited and prescribed circumstances and purposes. It requires that the onward use of information obtained from the register should respect privacy considerations, and that as far as possible, any conditions imposed by the seller on the use of information in a home information pack, in accordance with clause 139, be respected. It also makes the unauthorised disclosure of information a criminal offence in order to deal with someone who, for example, sells details to a double glazing salesman, or the selling of information on the home of a public figure to a newspaper. Finally, the amendment allows the Secretary of State to maintain the register if the private operator proves unsatisfactory.

Geoffrey Clifton-Brown (Conservative, Cotswold)

Can the Minister say in what form the register be kept? Will it be kept electronically and who will have access to those records? Will the Government have access to them? There is the suspicion that they could use home condition reports to do the next council tax revaluation for nothing. How will the Data Protection Act 1998 protect people's privacy, given that there will be a lot of very private information in the packs?

Keith Hill (Labour, Streatham)

It is precisely because I anticipated that the hon. Gentleman—whom I know well, and with whom I have jousted on many previous occasions—would take an interest in these matters that my speech includes what I hope will prove persuasive answers to those issues.

Dealing with these important issues administratively when approving a certification scheme involves doing so behind closed doors, but we feel that it is in everyone's interest that they be dealt with openly and on the record through regulations. The amendment should ensure that the register is kept in a proper way, while respecting privacy considerations. An electronic register of home inspectors and of home condition report data is essential to ensure authenticity and trust. I should emphasise that access to the register will not be a free-for-all and will be strictly controlled.

We envisage that access will be available to the seller and potential buyers, and to their professional advisers and agents, so that they can, for example, check the integrity of copies of home condition reports supplied to them. We also intend to enable access to certification schemes in order to assist with their operation, and to ensure that proper standards are maintained. We envisage that certification schemes will use the register of home condition reports to monitor, or to undertake, spot checks on the work of home inspectors to ensure that they maintain the required standards.

Allowing mortgage lenders online access to the register of home condition reports will assist with valuation assessments and help to avoid unnecessary valuation inspections. It will enhance the efficient operation of the home buying and selling process, and reduce costs for home buyers. We continue to work with the Council of Mortgage Lenders and other stakeholders to ensure that lenders can use the home condition report as a source of information from which a valuation can be derived, without the need for a separate valuation inspection.

Matthew Green (Liberal Democrat, Ludlow)

Much of what the Minister is saying is welcome, but I am concerned about what happens when someone chooses to market their property without going through an estate agent, as they have the right to do. When they produce their pack, how will they check who has access to such information? Will a prospective buyer gain access to the register? If so, will they access such information only in respect of the property in question, or will they be able to peruse information on all properties online, simply because they have said that they are interested in buying a particular property? I am slightly confused as to how the process will work.

Keith Hill (Labour, Streatham)

It will be for the seller or their agent to make the home condition report available to the potential purchaser. Provision will be made to ensure that access to the report is restricted to those potential buyers to whom the would-be seller wishes such information to be made available. If the hon. Gentleman will allow me, I shall spell the situation out in a little more detail in due course.

The expected content of the home condition report has already been discussed in detail with lenders to ensure that it incorporates the data that they will need to create valuations, using automatic valuation models or other innovative valuation methods. We therefore envisage that access to the register will be allowed to lenders and others involved in carrying out valuation assessments on behalf of lenders.

I should point out that no final decision has been taken as to whether one of the proscribed uses of information from the register will be as a source of statistics on the condition of the nation's housing stock and its energy efficiency. If such a use were permitted, it would be subject to data protection and privacy considerations. Amendment (c) provides for regulations that restrict access to prescribed circumstances or purposes, and to prescribed descriptions of persons. We intend that access will not be indiscriminately available. For example, a potential buyer would need to have the HCR reference number in order to access a home condition report on the register. That reference number would be available only from the seller or their agent, which will ensure that data on the register is not available to any person who cannot satisfy the seller or their agent that he is a bona fide potential buyer.

Geoffrey Clifton-Brown (Conservative, Cotswold)

The Minister has virtually admitted that what I said to him a few minutes ago is true. He says that the Government will use this information for statistical purposes. Is it not true that that will enable them to use it to obtain a revaluation of the entire nation's housing stock at very little cost, and without involving valuers?

Keith Hill (Labour, Streatham)

The hon. Gentleman is getting over-excited about a possibility that the Government are not contemplating. We have made no final decisions on this matter, but we do take into account the possibility that the register could be of value in making broad assessments of the condition of the nation's housing stock. The hon. Gentleman takes a close interest in this issue, and he surely will not regard such an approach as disadvantageous, should we decide to pursue it. However, this is a matter for consultation and open discussion in due course.

David Kidney (Labour, Stafford)

I hope that my right hon. Friend finds my intervention helpful. Is it the Government's intention to make it a criminal offence for people to disclose information from the register that should not be disclosed, and is that the purport of subsection (7) of amendment (c)? Moreover, is there a typographical error in that subsection? It states:

"A person who contravenes subsection (3) is guilty of an offence",

yet subsection (3) deals with the paying of a fee in order to include a report on the register. In fact, it is the contravening of subsection (4) that would constitute a criminal offence.

Keith Hill (Labour, Streatham)

Can the House be surprised that I describe my hon. Friend as my guru in these matters? Not only has he anticipated exactly the point that I was about to make on disclosure, but he has also made a typically shrewd point about a typographical error in the amendment. I can confirm that there is indeed such an error, and it will of course be put right. I am most grateful to him for drawing the House's attention to it, and I am sure that he is grateful for my immediate and positive response. That certainly demonstrates the listening character of this Government and this Minister.

I was about to say that any disclosure, except as provided for in regulations, would be taken very seriously and would amount to a criminal offence. My hon. Friend the Member for Stafford (Mr. Kidney) is absolutely right about that. Anyone committing such an offence, for instance, by passing on data from home condition reports to a building firm or to the proverbial double glazing salesman, would be liable on summary conviction to a fine of up to level 5 on the standard scale—currently a maximum of £5,000. That is equivalent to the penalty for offences relating to infringing the Data Protection Act 1998. The Home Office has confirmed that criminal offences for the unlawful disclosure of information are the norm in legislation and has approved this particular offence.

Clause 153 provides that the Secretary of State may make grants towards expenditure incurred in connection with the development of proposals for the contents of home information packs or of potential home inspector certification schemes. Amendment (d) is consequential on the introduction of the new clause and provides that the Secretary of State may also make grants towards expenditure incurred in the development of a register of home condition reports.

There are legitimate sensitivities surrounding disclosure of information—I fully concede that to the hon. Member for Cotswold (Mr. Clifton-Brown)—we will not know for some time which certification scheme will get approval. We will need to begin work on developing the technology for a secure register of home condition reports as soon as possible in order to address those issues, and that work will require a grant. We also need to ensure that the register is not specific to a particular certification scheme so that it is possible for the keeper of the register to be changed, if necessary, without resulting in practical difficulties.

It is important that consumers and lenders can trust the home condition report and be able to rely on it with confidence. Together with the provisions for home inspectors' certification schemes already in the Bill, these amendments should provide that confidence. In moving these Government amendments, I draw the House's attention to my support for amendments Nos. 142, 145, 147, 148 and 149.

Robert Syms (Conservative, Poole)

This is an important part of the Bill; it is just a pity that we are here at five minutes to midnight debating such important detail. I wish to put a number of questions to the Minister.

The proposal to have a register of approved surveyors or inspectors is sensible because people can check the register to see whether the person is qualified. One of the major concerns in Committee was whether the supply of surveyors or inspectors would be sufficient, so having a register also seems reasonable on those grounds. My question is whether the register will be broken down into regions or counties. There could be a surplus of surveyors in the north-west, with other areas having a deficiency, which could affect the ability to produce home condition reports within a reasonable time frame. It would be helpful to have a breakdown of surveyors and inspectors, including where they live.

The Minister made several points about the home condition report—for example, whether it should have a reference number or be put on the internet and what the controls should be. My hon. Friends have raised a number of concerns about those issues. If the information is too restricted, there is a danger of missing some opportunities. Will the register of home condition reports be made available to those who are registered inspectors or surveyors? If a home has been sold four times and had four home condition reports, the logical starting point for a surveyor would be to look at the last four reports on the home to see whether there had been any problems in the past. It seems silly to start from a blank sheet of paper when, first, there is a shortage of surveyors and, secondly, the home to be inspected has already been inspected many times.

Geoffrey Clifton-Brown (Conservative, Cotswold)

May I suggest a simple way around that problem? My hon. Friend might want to press the Minister on what I am saying. If the home condition report and home seller's pack become the property of the purchaser on completion of the purchase, the purchaser will then have full property rights and would be well advised if he wanted to sell the house subsequently to make the information available to his surveyor because it would reduce the cost of producing a new home condition report.

Robert Syms (Conservative, Poole)

I thank my hon. Friend for making that reasonable suggestion. I am sure that what he says will be heard. When a house is modern and has been sold a number of times, it would be illogical to deny information about it to registered surveyors or inspectors.

The Minister also referred to lenders having the information. The standards of building on estates in certain parts of the country are not particularly good, so is it not a matter of concern that, if lenders have access to the register, they might blight certain estates? Accusations are already sometimes made about lenders, particularly when certain areas have a bad reputation. How free will access to lenders be? Will they be able to look at individual reports or at the register in its entirety? I suspect that many lenders will build up a picture, which could lead to decisions being taken on the basis of the postcode. That could be a problem for some people. How will the proposals operate in practice? It is important to get the balance right between having reasonable access so that we do not always have to reinvent the wheel and protecting the privacy of the homeowner or home seller. As the Minister said, we do not want the double glazing salesman or building company to have full access to the information.

If the Minister has enough time, will he say more about whether the insurance scheme for home condition reports is in place? I know that concerns have been raised about that. Insurers are also worried about problems of flooding, underground drainage and so forth. Has a final decision been taken about what type of report will be used for the register? We have only a few more minutes left, so I will end there to allow other hon. Members to ask a few questions.

Matthew Green (Liberal Democrat, Ludlow)

I will be brief. We broadly welcome the amendments in the group, including the Government amendments, which go a long way towards dealing with the concerns of the House of Lords, but I want to ask the Minister a couple of questions about the administration and security of the system.

From what the Minister described, it would appear that, under the system, people producing the reports could post them on to a register via a remote server somewhere. The difficulty arises in controlling access to it. The Minister says that buyers will be given a unique number for a particular property, allowing them to look into that single property alone. Even with a good random generator of numbers, given the sheer number of properties available on the market at any one time, it would be possible for someone to guess the numbers and be able to look at other properties. That will be a problem if the register is accessed through a single number, however large. In reality, there are likely to be patterns in the numbers; they are not purely random. From what the Minister described, it would be possible for people to view other properties.

The question of security raises another potential concern. As we saw last week, online banks can have problems with unauthorised access to some of their systems. Can the Minister be confident that no one could hack into the system holding the details on, say, the house that the Prime Minister has just purchased and sell the information or publish it on the internet? Can the system be secure at the same time as being flexible enough to allow access to all the users who need it? The Minister seems to have much more confidence in the ability to set up a foolproof system than I have.

The amendments have gone a long way towards addressing the issues raised in the other place. We do not support home information packs, but if they do go ahead the amendments will be necessary. On that ground, we will not oppose the Government on this issue tonight.

Geoffrey Clifton-Brown (Conservative, Cotswold)

I shall take one minute to make a few key points and to enable the Minister to reply to the important points that have been made.

First, access to information is critical. One of the key aspects is that, if it is possible for unauthorised people to access the information, the home information packs could become a burglars' charter. I hope that the Minister will reassure us that hackers will not be able to access the information if it is stored electronically. Given the record of such systems, I do not know how he can do that.

Secondly and most importantly, many inspectors will be needed. Inevitably, some of those inspectors will be trained at very short notice and mistakes will therefore be made. It is important that an adequate insurance scheme is in place. People must also have the ability to sue on the reports if they prove to be incorrect. I hope that the Minister can tell us whether that will be the case, because otherwise the reports will have zero value.

Keith Hill (Labour, Streatham)

I shall take the issues raised in reverse order. The hon. Member for Cotswold (Mr. Clifton-Brown) asked about insurance against error in the reports. I may say that an indemnity scheme has always been part and parcel of the proposition. The indemnity scheme will apply to home inspectors as it already does to conveyancers, and we think that it is a good idea to extend it to estate agents, through the estate agents redress scheme, which has been approved by the other place and has received a general welcome for both particular and general reasons. The monitoring of home condition reports will also allow judgments to be made about the performance of individual inspectors.

The hon. Gentleman raised the hoary old issue of access to information and the burglars' charter. We have gone over that matter on many occasions, but I shall reiterate—given that the allegation always seems to creep into adverse media coverage—that the home condition reports will contain no plans of the property, no information about security devices or alarms and no information about safes. We do not believe that the reports will remotely begin to add up to what he described as a burglars' charter.

The hon. Member for Ludlow (Matthew Green) raised several points and I am grateful for his qualified support. He asked about the operation of the electronic system and whether someone could hack into its numeration arrangements. That is a valid issue. We need to get the details right, and that is why we would do a great deal of work with all the relevant partners to ensure that that could not happen.

The hon. Member for Poole (Mr. Syms) raised several issues. He asked whether lenders will be able to look at individual reports, and the answer is yes. They will have the advantage of looking at the entirety of the property, which is not always the case in the present system. He asked whether the register would be open to other inspectors and would they have access to all home condition reports on the register. Again the answer is yes. He also asked whether there will be regional or local registers, and the answer is yes. I hope that I have been able to reassure him on the points that he raised.

Lords amendment disagreed to.

Government amendments (a) to (d) in lieu of Lords amendment No. 140 agreed to.

New Clause

Decent Homes Standard for Social Housing

Keith Hill (Labour, Streatham)

I beg to move, That this House disagrees with the Lords in the said amendment.

Yes, it is me again. The new clause proposed by the amendment would require the Secretary of State to ensure that, by 2016, all existing social housing stock should, as far as is reasonably practicable, achieve a SAP rating—an energy rating under the standard assessment procedure—of no lower than 65, which would amount to a change in the decent homes standard. I refer to that point because material circulated among Members recognises that the decent homes standard is the Government's vehicle for the delivery of heating and thermal comfort.

I remind Members that the decent homes standard aims to tackle the worst problems. It triggers action; it is not a standard to which work is done. I also remind Members, as I have on earlier occasions, that when the Govt took office in 1997 no fewer than 2.2 million social homes were non-decent and there was a £19 billion backlog of work. The work we have done, and are continuing to do, tackles a range of problems that affect housing—leaking roofs and mould and damp in kitchens and bathrooms that have not been touched since the homes were built, which in some cases was the 1930s. Our work is having a huge impact on the lives of some of the most vulnerable members of society who have lived, or who currently live, in non-decent homes. I said "have lived" because, since 1997, we have reduced by 1 million the number of homes below the decent homes standard—a fact that we celebrate and rejoice in on the Labour Benches.

The decent homes programme is helping to rejuvenate some of our most deprived communities and is contributing towards improving public health and the well-being of tenants. By tackling poor housing, we are facing head-on a problem that is rife in the most disadvantaged communities and that affects the most disadvantaged groups. By making homes decent, in many cases alongside wider regeneration work, we are making whole areas more attractive places in which to live.

I should like to quote some of the tenants whose lives have been changed as a result of the decent homes programme, such as a tenant on a Walsall estate—not in the constituency of my hon. Friend the Member for Walsall, North (David Winnick), who is in the Chamber, but in the constituency of my right hon. Friend the Member for Walsall, South (Mr. George)—who said:

"For many years the residents of Delves West felt like they were forgotten. We never seemed to get any investment in our homes. Thanks to the Decent Homes programme we are now making a real difference. Residents are getting the decent homes they've waited for, for so long."

In Redcar, some tenants were "over the moon", and a resident in Kensington and Chelsea, visited by my right hon. Friend the Deputy Prime Minister in May, said:

"It was absolute murder before and now it's a godsend".

Amendment No. 190 picks up on one aspect of the decent homes programme—improving the thermal efficiency of homes and, in doing so, contributing to reducing fuel poverty and thereby increasing energy efficiency. We take seriously our responsibilities for alleviating fuel poverty. However, I remind the House that the decent homes programme has four elements: meeting the current statutory minimum standard for housing; achieving a reasonable state of repair; ensuring reasonably modern facilities and services; and providing a reasonable degree of thermal comfort. The programme therefore aims to tackle a wide range of problems and to prioritise the worst homes, of which there remain 1.4 million; including a SAP rating of 65 would add a further 1.7 million households, of which, as I shall demonstrate, only 120,000 would be fuel-poor.

We cannot seek a policy of perfection in regard to one of the four elements of the decent homes standard—thermal comfort—and disregard our obligations to tenants to make more basic improvements. For those people who live in non-decent homes, works such as mending a leaking roof, replacing rotten windows and tackling unsafe electrics matter more than focusing purely on energy efficiency.

Before I continue, it would be useful to explain to the House what fuel poverty is and how many people it affects. Fuel poverty occurs where those in a household spend more than 10 per cent. of their income on heating their home to an adequate standard of warmth. That is generally defined as 21° C in the living room and 18° C in the other occupied rooms. Fuel poverty affects 350,000 social sector households in England. Of course, the Lords amendment applies to the social sector. About 120,000 of those households meet the decent homes standard and about 230,000 households are currently non-decent homes.

We expect that the work done to those 230,000 social homes under the decent homes programme will bring most of those households out of fuel poverty. The work done by authorities is expected to raise the thermal efficiency of those homes well above the minimum that triggers action. The guidance that we have issued recommends that, when loft insulation is fitted, authorities should take the opportunity to improve energy efficiency and install it to a much greater depth than the 50 mm that triggers action and that, when new heating is installed or systems replaced, landlords should install energy efficient boilers where possible. Energy efficient boilers have a SEDBUK—seasonal efficiency of domestic boilers in the UK—A to C rating. We also recommend that landlords take advantage of DEFRA and DTI sponsored programmes that require suppliers of gas and electricity to achieve energy efficiency targets by helping landlords to take up energy efficiency measures.

Matthew Green (Liberal Democrat, Ludlow)

rose—

Keith Hill (Labour, Streatham)

I see that the hon. Gentleman is bestirring himself; and, of course, I give way to him.

Matthew Green (Liberal Democrat, Ludlow)

I thank the Minister for giving way, but does he accept that not all the 230,000 households that he says will be raised to the decent homes standard will necessarily reach the SAP 65 rating? Many of those homes may well have to be revisited in future to get them up to that level. In fact, we are talking about guidelines, so some councils—perhaps those facing financial pressures—will not go the whole hog; they will do just enough to meet the decent homes standard without hitting the higher rating.

Keith Hill (Labour, Streatham)

Unusually for the hon. Gentleman, he is labouring under a misapprehension. He is usually very precise. In fact, very few of those 230,000 homes are likely to reach the SAP 65 level. That is exactly why I explained that the requirement for SAP 65 would not only embrace the 1.5 million so-called non-decent homes that we propose to tackle using the decent homes programme up to 2010, but entail a return to a further 1.7 million social sector homes that do not attain the SAP 65 level. The important thing to remember is that fuel poverty relates to the percentage of income that is necessarily expended to achieve a decent level of thermal comfort.

Many householders who live in homes that do not have a SAP rating of 65 are not in fuel poverty because they do not spend a sufficiently high proportion of their incomes on the issue. It is terribly important for all hon. Members to bear it in mind that fuel poverty is a factor of not the physical fabric of a property, but the relationship between thermal comfort, or the need to compensate for heating loss, and income. The truth is that only a small proportion of those in fuel poverty live in social homes that are below the decent homes standard—about 120,000. Many people who live in fuel poverty might live in homes with a SAP 65 rating, which is why our fundamental argument is that it would be an immense over-reaction to insist on the SAP 65 standard across the board to lift households out of fuel poverty. It would be like using a JCB to smash a nut.

Brian White (Labour, North East Milton Keynes)

Tackling fuel poverty is a key objective for the Government. However, they have several other objectives, such as reducing CO 2 emissions, which SAP 65 would help us to achieve. The Minister is missing the interaction between the objectives.

Keith Hill (Labour, Streatham)

I disagree with my hon. Friend, although I do not often do that because we have a good relationship both inside and outside the Chamber. We have dealt with such matters already. I have demonstrated that the Government are clearly committed to, and on route towards, achieving their carbon saving and energy efficiency targets. We mislead ourselves if we confuse energy efficiency and fuel poverty because they are different issues that we must separate in our minds.

The Government's argument is that the small numbers of households in fuel poverty should be dealt with individually. Interestingly, such households are characteristically not made up of senior citizens. They tend to be made up of people on low incomes living in three-bedroom houses. It is clearly possible to devise strategies to deal with such individuals. Indeed, the fuel poverty action plan has been designed to ensure that fuel poverty will be eliminated in such vulnerable households by the year 2010, and a report is due later this year. For all those reasons, although I take my hon. Friend's point about energy efficiency on board, we need to focus carefully on the precise sources of fuel poverty.

David Taylor (Labour/Co-operative, North West Leicestershire)

My right hon. Friend is one of the more lucid, rational, thoughtful and, especially, numerate Ministers—he is no doubt set for further promotion. Does he agree that if the only available options to address local authority tenants facing fuel poverty are stock transfer, the private finance initiative and arm's-length management organisations, all of which are more expensive than conventional local authority methods of raising houses to a decent standard, fewer houses will be tackled with the available pot of money than would have been the case if he had delivered option four, as he told the fringe meetings at the party conference that he would?

Keith Hill (Labour, Streatham)

I am grateful to my hon. Friend, who teases me. Although I know that there is an undercurrent of great seriousness in his observations, I sometimes feel that the fourth option is to him what King Charles's head was to Mr. Dick in "David Copperfield". I decline to be sucked down that vortex.

We have issued guidance that is designed to improve energy efficiency. The effectiveness of what is being done to improve heating and insulation under the decent homes programme is demonstrated by what our tenants say about it. A tenant in my hon. Friend's and mine beloved east midlands said:

"At last I have decent heating and a radiator in every room, meaning my home is not only warm and cosy but actually cheaper to heat than before."

Another tenant in Chelmsford—I like to demonstrate a regional reach in my examples—described how her heating bills dropped from £35 a week in winter to £8 a week all year round.

We are working very hard to ensure that the Government meet their target on alleviating fuel poverty and improving energy efficiency, but I recognise that about 120,000 householders who live in homes that are above the decent homes threshold are in fuel poverty. However, it is not necessarily the very poor energy efficiency of the homes that is the main problem. As I have said, most of the households are single non-pensioner households on extremely low incomes living in three-bedroom homes. There are other issues to tackle beyond work to the physical fabric of the home.

Matthew Green (Liberal Democrat, Ludlow)

Will the Minister give way?

Keith Hill (Labour, Streatham)

If the hon. Gentleman will forgive me, I will make progress because other colleagues want to contribute. I am conscious that I have spoken at some length on this amendment and others. I dare say that he will have his opportunity later.

Amendment No. 190 wants us to tackle the problem of having around 120,000 households in fuel poverty in the social sector by increasing by 1.7 million the number of homes that would need work in accordance with the decent homes standard. Those homes are currently decent but below SAP 65, and they would more than double the number that we still have to tackle under the programme. The amendment would require the minimum standard that triggers action to be SAP 65. That would cost—I say this in all earnestness—£28.5 billion to solve a problem in 120,000 homes. That is roughly equivalent to 8p on the basic rate of tax. This is more than a sledgehammer to crack a nut. The amendment is a JCB. Indeed, a JCB might be the only solution for many homes if all social housing is to achieve a SAP 65 rating. An estimated 400,000 homes could not be brought up to that level of energy efficiency. For those, demolition and rebuilding would be the only solution at a cost of more than £20 billion, excluding any costs of re-acquiring property.

For the homes that could achieve SAP 65, some would require additional work over and above basic measures to improve their energy efficiency. For example, we would have to carry out insulation to the solid walls. That would cost £6 billion. Then there are those homes that would not be in the decent homes programme since they already meet the current levels of thermal comfort required. Work in those homes would include replacing boilers that are still functioning, modifying electric immersion heaters and installing double-glazing, which would cost £2.5 billion.

The grand total comes to an astonishing £28.5 billion. Demolition and rebuilding would cost more than £20 billion. Tackling hard-to-heat homes would cost £6 billion. To cover homes that do not currently come under the decent homes programme would cost £2.5 billion. That extra expenditure would cripple the budgets of local authorities and many housing associations. It would mean that work on wider regeneration work, including security measures and environmental improvements, would go undone. Those things matter to tenants, and how would we explain to them that those priorities would no longer be addressed? The new target would amount to moving the goalposts for social landlords who have been working hard to achieve the decent homes standard. Planned programmes of works would need to be rescheduled, which would disrupt not only landlords but tenants.

Even if it were possible to achieve SAP 65 for the social sector at a reasonable cost, it would still be unwise to fix that in statute. The standard assessment procedure measures energy efficiency on an index calculated by considering the annual space and water-heating costs for a standard heating regime. It is a constantly evolving mechanism that will change in response to new energy efficiency technology and changes in fuel prices. We have a huge range of social housing stock in this country, and a SAP target of 65 would be expensive, unachievable and inflexible. We prefer action on achievable targets to aspirations that, frankly, have not been properly thought through. We want to deliver on our decent homes programme by 2010, not see it jeopardised and perhaps put back to 2016. Above all, we cannot choose one part of our decent homes programme and promote it above everything else. We have a duty to tenants, and must provide them with the improvements in their living conditions that really matter to them. While energy efficiency may be the primary concern for some people, it is certainly not the primary concern for all social sector tenants. Our efforts in this area should remain focused on delivering the essential work needed to make all homes decent, and in doing so we must always maximise energy efficiency and promote the alleviation of fuel poverty. However, to put those two concerns above all else would be unrealistic.

In conclusion, a target of SAP 65 for all social sector homes would cost the taxpayer about £28.5 billion. The Government are committed to dealing with fuel poverty and to improving energy efficiency. However, we are not committed to doing that in an impractical and ludicrously expensive manner, as the amendment suggests. It is for those reasons that I invite the House to disagree with the amendment.

John Hayes (Conservative, South Holland and The Deepings)

The Minister said that the amendment, which was supported in the Lords by Liberal Democrats, Conservatives and Cross Benchers, but not by members of the governing party, was a sledgehammer to crack a nut. He said that it was like using a JCB or a juggernaut to deal with a problem that could be dealt with much more lightly. However, it has managed to attract the support of no less a group of people than the National Pensioners Convention, Shelter, Age Concern, Help the Aged, the National Right to Fuel Campaign, WWF, the Campaign to Protect Rural England, the all-party groups on warm homes and on intelligent energy, the Association for the Conservation of Energy and National Energy Action. Most people who are concerned about the welfare of some of our most vulnerable citizens, as well as most people who are concerned about energy conservation, disagree fundamentally with the Minister's analysis.

Brian Iddon (Labour, Bolton South East)

rose—

John Hayes (Conservative, South Holland and The Deepings)

If the amendment is a sledgehammer to crack a nut, it is supported by a considerable number of people worth listening to, perhaps including the hon. Gentleman.

Brian Iddon (Labour, Bolton South East)

I was chairman of housing when the Conservatives were in power, and I suffered a 75 per cent. cut in funding for both the private and public sectors. Having listened to the hon. Gentleman, may I ask whether, if they regain power, the Conservatives would commit themselves to a SAP rating of 65?

John Hayes (Conservative, South Holland and The Deepings)

The hon. Gentleman is a wise and shrewd enough parliamentarian to know that you would not permit me, Mr. Deputy Speaker, to detach myself from the proper consideration of the amendment and meander into a debate about the history, interesting as it may be, of his service in local government, or indeed into a fanciful discussion about what may happen at a distant time in the future—although in fact I do not expect it to be very distant, as I should be replacing the Minister in a few months' time if what we read in the press is true.

I will be absolutely straight with the hon. Gentleman, who speaks with great passion about these subjects: the Conservatives, if I have anything to do with it, will take the issue of fuel poverty seriously. I believe very strongly in the warm homes agenda, and I will certainly, as Minister, review what he has said and done with a view to making significant progress in the campaign against fuel poverty. That is said genuinely; I am not trying to evade his point. He would not expect a bigger commitment than that, given that I am the Opposition spokesman, not the Minister, but I assure him that I will address the issue of fuel poverty when I become Minister and get the red boxes, the car and all the rest of it in a few months' time, and when the Minister begins to enjoy his long retirement and is relieved of the appropriate pressure that is being brought to bear on him.

The amendment demands that all social housing should meet the standard assessment procedure rating of 65. That is the measure of energy efficiency in homes that is agreed by the Government and recognised elsewhere. There are two aspects to this debate: one concerns carbon emission targets, and the other fuel poverty. Both were well aired in the other place. Perhaps I may beg your indulgence for a second, Mr. Deputy Speaker, to pay tribute to Baroness Hanham and Lord Hanningfield, who did much good work there, together with noble colleagues from other parties. I single them out for particular praise because they did their very best to improve the worst aspects of the Bill. Lord Hanningfield pointed out that the Government had a manifesto commitment to decrease CO 2 emissions by 20 per cent. by 2010 based on 1990 levels; that from 1990 to 1997 carbon emissions decreased by 13.1 megatonnes of carbon; and that since this Government were elected in 1997 they have remained virtually static, while in three of the past four years they have increased. In August this year, the Environmental Audit Committee reported that the Government's latest forecasts indicate that carbon emissions by 2010 will be 8 megatonnes more than the target—a 25 per cent. shortfall.

The amendment calls for a 20 per cent. improvement in domestic energy efficiency by 2010, based on 2000 levels. That is equivalent to the saving of 5 megatonnes of carbon emissions from the domestic sector by 2010 that the Government originally stated as their intention and is the target that they assured the public no fewer than 15 times would be set as the energy efficiency aim under the Sustainable Energy Act 2003. A range of Ministers assured both Houses that that would be the case, until April this year when they reduced it to 16 per cent.—a saving of 4.2 megatonnes.

The original target is supported by the Energy Saving Trust, the Government's official adviser on energy efficiency; the Cabinet Office performance and innovation unit, the Government's advisers on energy policy; and the Sustainable Development Commission, the Government's advisers on sustainable development. It is also supported by a large number of Members on both sides of the House, particularly on the Labour Benches, who have taken fuel poverty, carbon emissions, the relationship between the two and the need for better energy conservation very seriously, campaigned on it, spoken on it and made their position patently clear, whereas the Government's position on this is not at all clear. There are fundamental contradictions between what they have said in the past and what they are saying now; but even more than that, there are—heaven forbid—contradictions between what different Ministers say about it.

The Minister for the Environment and Agri-environment said that

"research has shown that bringing homes to a SAP rating of 65 is a level at which there is a minimal risk of a household being in fuel poverty."—[Official Report, 19 April 2004; Vol. 420, c. 138W.]

Lord Whitty expressed sympathy with the amendment. On 19 October, at a meeting of the all-party warm homes group in Committee Room 17 in the House of Commons, the same point was made to him. He replied:

"I have sympathy with this . . . I am not defending ODPM."

It is clear that the ODPM and the Minister stand alone in the matter. Even his ministerial colleagues are not prepared to line up alongside him and defend the change of policy. Apart from concerns about emissions and the Government's failure to meet their targets, there are even more profound anxieties about the impact on many vulnerable people.

The Government have a legal duty to end fuel poverty under the Warm Homes and Energy Conservation Act 2000. The Minister has spoken about the meaning of fuel poverty and made it clear that he shares the commitment to combat it. However, the Government have agreed that a SAP rating of 65 is needed to achieve that objective. Other Ministers have made it clear that the only way in which the Government will achieve their aim is by adopting a different policy—that which is outlined in the amendment. The Government's figures demonstrate that. In 2001, the Department of Transport, Local Government and the Regions consultation on the decent homes standard stated:

"Twenty-five per cent. of social sector tenants living in homes with these stock measures"—

insulation and heating measures that comply with the current decent homes standards—

"are still fuel poor."

Twenty-five per cent. is approximately 650,000 or 1.4 million people, based on the national average of 2.2 people per household.

The latest figures suggest that more than 1.141 million homes fall below standards on the ground of thermal insulation. The current policy is to bring those homes up to a decent homes standard, which will not necessarily mean that they escape fuel poverty. It is not good enough for the Minister to say that the Government are committed to decent homes. Of course it is right to improve the stock of social housing in all sorts of ways but it is unacceptable not to tackle the fundamental issue of insulation and fuel poverty as part of that, in order to deliver the Government's stated aims.

The House of Lords debated the matter in a measured and reasoned way. The debate showed the passions of Members from across the political spectrum. It was not simply a matter of knockabout, Opposition versus Government, politics. Any reading of the debate reveals a genuine commitment on behalf of hard-pressed people.

The gist of the Government's case is straightforward. They have effectively reneged on their original commitment. They have lowered the bar because they know that it will be difficult to reach the standard that the amendment demands of them. The excuse that the Minister gave initially in his contribution was that doing so would mean taking their eye off the ball for other aspects of the decent homes standard. However, he gave the game away at the end of his speech by saying that it was all about cost. He thus confirmed what was said in the Lords. In answering the proponents of the amendment, Lord Bassam said that it would focus on one aspect of decent homes to the detriment of others. He said:

"That is what the amendment would do, but at a potentially huge cost . . . bringing all social housing up to a standard of SAP 65 could add £3 billion to £5 billion to the cost of the decent homes programme."—[Official Report, House of Lords, 3 November 2004; Vol. 666, c. 379.]

It is not as simple as that, however, because failing to support this amendment will waste vast sums of public money. The Government will ensure that works are undertaken on all social homes to bring them up to the decent homes standard, but they will still leave a large number of people in fuel poverty. The law will require them to address that issue at some stage in the future and to spend additional sums to take those people out of fuel poverty. The truth of the matter is that this is a false economy. If the Government were to get this right now, they could fulfil their legal responsibilities in one coherent and consistent programme. Instead, however, what Lord Hanningfield has described as the "double visit" to the project will cost more and be extremely wasteful. The Government's argument about money does not stack up, given that they have acknowledged their overriding legal duty in this regard.

More than that, I disagree fundamentally with the Minister on this. This is a very important issue indeed, and not to address fuel poverty would be a dreadful shame that the Minister and the Government would have to carry.

Sally Keeble (Labour, Northampton North)

Will the hon. Gentleman give way?

John Hayes (Conservative, South Holland and The Deepings)

I apologise to the hon. Lady, but I am about to finish. I am usually very generous with interventions, as she well knows, but I want to give other hon. Members time to speak. Perhaps she will be one of them.

The freedom from fear and the freedom from want are fundamental objectives of any decent Government, and this Government should live up to those principles—[Interruption.] Well, the hon. Member for Eltham (Clive Efford) may chafe, but there are people on this side of the Chamber—and, I am sure, on his side—who believe that the mitigation of disadvantage is the greatest purpose of politics. I believe that to be the case, and I make no bones about stating it. I have always believed it, and I have said so many times. This is not a recent conversion for me.

Clive Efford (Labour, Eltham)

rose—

John Hayes (Conservative, South Holland and The Deepings)

I am not going to give way, so I am not sure why the hon. Gentleman is standing.

We have been told that the Minister is a literate, numerate and rational man. I think that he is also a good man, and that he will want to be remembered as a good Minister. On that basis, and in the spirit of agreement that he called for at the beginning of tonight's proceedings, I ask him to support the amendment and to adopt this standard, thus gaining the support of the broad consensus of opinion. His doing so would cast the Government in an entirely different light.

Matthew Green (Liberal Democrat, Ludlow)

I shall be brief, because I know that at least one other hon. Member would like to speak.

I have a little bit of sympathy for the Minister's position on this amendment; I am perhaps not as dogmatic as others on the issue. However, in attempting to fight it, he has done himself no credit whatever. Uncharacteristically, he has read things into the amendment that are not there, and cited figures that I do not think he could defend on closer examination. For instance, he talked about demolishing large numbers of homes in order to meet the standard, when the amendment says only that it should be met

"as far as is reasonably practicable".

I do not think that anyone would find it reasonably practicable to demolish lots of houses and build new ones. That takes £20 billion out of the £28 billion that he cited. I will not start delving into the rest—perhaps other hon. Members will want to tackle the question of the remaining £8 billion—but the figure certainly drops dramatically with a more accurate reading of the amendment.

The Minister is on difficult ground with this issue. As he himself explained, the definition of fuel poverty involves the amount a household spends on fuel in relation to its income. However, fuel prices are rising, and they are likely to continue to do so. Many people in the House, myself included, do not think that that is necessarily a bad thing, from an environmental viewpoint. However, by definition, it causes a problem, because if things stand still more people will be put into the fuel-poor categories. The figures that the Minister accounted for—the 120,000, the 240,000 and the 1.1 million people—could all increase.

There is a great danger that the advantage that the Government have had for the past few years, largely as a result of low fuel prices rather than Government intervention, will disappear. The Minister will be Minister for Housing and Planning when more people enter fuel poverty. Rather than taking an aggressive attitude against the amendment, which is well-meaning and has good practical thoughts behind it, and setting himself dogmatically against it, he should perhaps have moved some way towards meeting it, as it is clear that increasing the SAP rating of properties where it is relatively practical to do so does, as the Minister for the Environment and Agri-environment has made clear, bring people out of fuel poverty.

I am saddened that the ministerial response has been so dogmatically against the amendment. I shall go against the Government tonight, because I want them to make some move to suggest that they are aware of the gap between where they are and where they will be—it will be a problem—in a couple of years with the continuing rise of fuel prices. I hope that we hear from the Minister that he at least acknowledges that there is such a problem and that he has some action plan to deal with it.

Alan Simpson (Labour, Nottingham South)

I have no doubt that both Opposition parties will vote in support of the Lords amendment and I have no reason to doubt the sincerity of the comments made by both Front-Bench spokesmen, but I must point out in terms of questioning the depth of this commitment that not a single Opposition Back-Bencher has been present throughout the debate on this clause. That is not the case in respect of Labour Members, and I want to address Labour's commitments in my remarks.

The Minister rightly said that a number of different objectives are built into the decent homes standard. I do not think anyone in the House would dispute the value of that, but it is not true to say that the Government can then use that as a pretext for getting out of what we have set for ourselves as the non-negotiable obligation to eradicate, in its entirety, fuel poverty by 2016.

The Minister will know from a number of delegations that I have been involved with, particularly from the parliamentary warm homes group—I brought them to see him to discuss this matter—that we have also tried to explore other choices that the Government have. By and large, we have taken a twin-pronged approach to the eradication of fuel poverty: one through the warm front programme and the other through income support measures, involving the Chancellor and the Treasury. However, it is absolutely right to say, as the hon. Member for Ludlow (Matthew Green) did, that the viability of that intervention in income support will be put seriously to the test.

We have seen the end of the era of low energy prices; we are knee-deep in an era of dramatically increasing energy prices. None of us should kid ourselves that it will come cheap to the Government to intervene to pay people to throw money out of poorly insulated properties for no gain at all. There will certainly be a negative consequence of massively undermining our commitments to carbon reduction targets. The best way to tackle this is to address the structural condition of Britain's housing. As other Members have mentioned, on 19 April this year my hon. Friend the Minister for the Environment and Agri-environment pointed out that the best way to do that would be to set a minimum SAP rating of 65 for all social housing.

I suspect that if we were to do that, some other points that have been made to the Minister would come in on the shirt tails of it. He could, for example, also meet the fuel poverty reduction targets by making those standards apply to the private rented sector. We have tried to make the same representations. But we see in subsequent clauses that we will not go down that path either. We could, as my hon. Friend the Member for North-West Leicestershire (David Taylor) pointed out, give a fresh remit to local authorities for a new era of council house building, which is by far the cheapest and most effective way of intervening in the social sector. As yet, however, none of the promises of a level playing field in respect of local authority housing are in the framework for delivery by either the Minister for Housing and Planning or other Ministers.

What should we do to meet our existing legal obligations to eradicate fuel poverty? The Government's Fuel Poverty Advisory Group is now saying, in consistent terms, that we are not on track to meet our legal targets. We have choices about how we can meet those targets, but one choice that we do not have is to do nothing. Unfortunately, one of the ways in which we have built up cost consequences is by structuring the warm front programme so badly in the first instance that we are duplicating costs. We began by quoting numbers of households in fuel poverty that we have helped—we never said that we were not helping them out of fuel poverty, but we said that we were helping them in it.

The reality of the fuel poverty benchmark will not go away. The amendment gives the House the chance to address a structural issue with a structural solution. I beg the Minister to take that on board, not as a threat or challenge from the other place, but as a way of helping us out of a hole into which we have been digging ourselves.

Sally Keeble (Labour, Northampton North)

I had not intended to contribute to the debate today, and only the challenge from the hon. Member for South Holland and The Deepings (Mr. Hayes) made me feel that it was worth saying something in support of the Government's position and opposing that of the other place.

It seems to me that the Conservative party has completely misrepresented some of the basis of tackling fuel poverty and of the intent of the decent homes strategy, for two reasons in particular. First, we needed a decent homes strategy because of the legacy of disrepair that we inherited when the Conservative party left government. I was a council leader in one of the areas with some of the worst social housing in the country, and I recall how those homes were starved of funds, the price paid in terms of the discomfort of people living there and the real hardship of thousands of families in social housing that was on the skids. We needed a decent homes strategy so that social housing could approach a reasonable level after all that disrepair.

Like so many things that the Government have done, that strategy might not seem the most wonderfully heroic new socialist dawn. Given what we took over, however, it was a supremely ambitious programme, and extremely difficult to deliver. Once it is achieved, which I am sure it will be, the Government will have every right to be extremely proud of it. The only way to achieve our decent homes target is to balance the key measures that make homes unpleasant and unfit for people to live in. That is a question not just of technical standards but of what happens to the people who live in those properties and what they need.

Secondly, when we came into power we were confronted by massive fuel poverty, particularly among the old. A key factor in fuel poverty, which the Minister addressed and the hon. Member for South Holland and The Deepings did not, was income. That is why we introduced the winter fuel allowance, which the Conservative party opposed bitterly. It ill behoves a party that so opposed the winter fuel allowance to preach to anyone about fuel poverty. The reason why it is residual groups such as single people on low incomes, households with families or people with disabilities who are in fuel poverty is that we dealt with fuel poverty among pensioners with the winter fuel allowance, which has been increased year on year.

If we are talking seriously about tackling fuel poverty, I can certainly describe my wish list—as the Minister well knows, for I have berated him about housing improvements on several occasions. We should think not just about social housing but about private housing. Social housing sometimes has to be knocked down and replaced, but we must also deal with fuel poverty in the private sector—[Interruption.]—I see that I am now being asked to finish my speech.

There is a huge agenda to be tackled. I agree that we should keep to the programme that we have set and observe the priorities involved in it, but we should not lose sight of bigger goals. I do not think that the amendment would help us to achieve those goals, on which I am sure we all agree.

Brian Iddon (Labour, Bolton South East)

I want to make three brief points.

I am concerned about fuel poverty. My right hon. Friend the Minister said that 120,000 people were in that position, but I believe that a 10 per cent. fuel price increase would return 500,000 people to fuel poverty. We are on a treadmill, and I remind my right hon. Friend that fuel companies are making obscene profits: I think they amount to £8 billion. I hope that he will discuss with his friends on the Treasury team the possibility of a windfall tax so that we can really help those who are being subjected to fuel poverty by price increases. I have signed an early-day motion on the subject.

I raised the second point in Committee. We are setting different decent home standards for the public and private sectors. I am grateful for what the Government are doing in the private sector. Improved building control procedures are beginning to deliver better decent home standards, along with better architectural design and other features, but we are not catching up with that in the public sector.

The third point is this: we have wasted an awful lot of money trying to bring homes up to a decent standard in terms of fuel efficiency. We began with draught stripping, then dealt with cavity walls and UPVC double glazing. We improved central-heating systems in a thousand and one different ways. My plea to any Government, including this one, is that they take a holistic approach rather than persistently going back—three or four times, in fact—to trying to bring houses up to decent home standards.

Keith Hill (Labour, Streatham)

I shall try in the short time available to me to respond to all the points that have been raised.

The hon. Member for South Holland and The Deepings (Mr. Hayes) expressed his personal passion for the warmer homes programme, but as my hon. Friend the Member for Nottingham, South (Alan Simpson), observed, that passion was clearly not shared by his Tory colleagues, for the Tory Benches were empty throughout his speech. In fact, his colleagues missed the wrong speech on the wrong subject. However, since despite his weasel words and disavowals he spoke in favour of the amendment and is likely to divide the House, I think we can assume that he has committed the official Opposition to expenditure of at least £28.5 billion to achieve SAP 65 rating. No doubt the shadow Chancellor of the Exchequer, the right hon. Member for West Dorset (Mr. Letwin), will be most interested to learn of that not insubstantial spending commitment. The hon. Gentleman may find himself out of a job rather sooner than he has a chance to succeed me in mine.

I was grateful for the "little sympathy" expressed by the hon. Member for Ludlow (Matthew Green). He drew attention to the qualification

"as far as is reasonably practicable"

in the amendment, and argued that it would mean lower costs than I had identified. But where does that observation get us? It is as long as a piece of string. The amendment either indicates a serious attempt to attain a SAP rating of 65 or it does not. I have described the financial implications of taking it seriously, which are immensely costly. I have argued that it is a misplaced policy because, in the social sector—the amendment refers to the social sector—fuel poverty is a limited phenomenon that can be tackled by individual households.

That brings me on to the observations of my hon. Friend the Member for Nottingham, South. He is right. We have spoken about the matter on many occasions. I respect his commitment and his long-term campaign on these issues.

The hon. Member for South Holland and The Deepings drew attention to observations by ministerial colleagues in the Department for Environment, Food and Rural Affairs. However, DEFRA has not said that a SAP rating of 65 is necessary in all stock. What it has said is that removing fuel poverty depends on the characteristics of the individual household, but that SAP 65 is the level at which there is a minimal risk of a household being in fuel poverty. The precise answer given by the Minister for the Environment and Agri-environment to the hon. Member for Guildford (Sue Doughty) was that removing fuel poverty depends on the characteristics of the individual household. I recognise that we may be in an era of rising energy prices, but we cannot base an expenditure commitment of that scale on a relatively unquantifiable guess.

My hon. Friend the Member for Nottingham, South rightly talked about the warm front programme, but I remind him that that programme deals exclusively with the private sector and that that is where the problem of fuel poverty is immensely more extensive. My hon. Friend the Member for Northampton, North (Ms Keeble) was right when she identified that the kernel of the fuel poverty issue is in the private sector, but the amendment is about the social sector, not the private sector. My contention is that, because the standard is much higher in the social sector, the issue is much more manageable through interventions other than this blunderbus approach to SAP 65. I was grateful to my hon. Friend, a distinguished former housing Minister, for her support and for exposing the hypocrisy of the Conservative party.

I say to my hon. Friend the Member for Bolton, South-East (Dr. Iddon) that I will certainly draw to the attention of colleagues in the Treasury his observations about fuel prices and a windfall tax. I thought that he was wrong when he said that we were not catching up with the private sector. For all the reasons that I have mentioned, I believe that we are doing and will do better in the social sector. However, as he demonstrated to me when I visited him in the Haulgh in Bolton, it is best to do it together. I accept his observations about a holistic approach.

I know that, in some respects, my response will be a disappointment to colleagues on the Labour Benches, but I have attempted to be precise and accurate and to demonstrate the Government's commitment to dealing with fuel poverty. It will be dealt with in the social sector by techniques that are different from those proposed in the amendment. For all those solid reasons, I invite the House to disagree with the Lords in the said amendment.

Clause 3 — Local housing authorities to review housing conditions in their districts

Keith Hill (Labour, Streatham)

I beg to move, That this House agrees with Lords in the said amendment.

Michael Martin (Speaker, Glasgow Springburn)

With this we may discuss Lords amendments Nos. 2 to 25, 212 to 214, 216, 218, 219, 221, 248, 250 to 252, 271, 273, 275 to 278 and 281 to 283.

Keith Hill (Labour, Streatham)

The great majority of these amendments are, as you can see, Mr. Speaker, minor and technical. They are either consequential on amendments made to later provisions in the Bill, intended to rectify small errors or clarificatory, but there are a few that I should briefly like to draw to the House's attention.

Lords amendment No. 2 responds to concerns raised by the Joint Committee on Human Rights. Under clause 5, which deals with the health and safety rating system, where a category 1 hazard exists, the local housing authority is under a duty to take the most appropriate course of enforcement action available to it. Under clause 7, where a category 2 hazard exists, it may take one of the available courses of action.

Sally Keeble (Labour, Northampton North)

I am pleased that overcrowding will be dealt with separately, and I congratulate the Government on the consultation on that. What is the Government's thinking on overcrowding in relation to the special needs of children with behavioural and other difficulties, and will those special needs be taken into account in considering the revision of the overcrowding rules?

Keith Hill (Labour, Streatham)

As ever, I am grateful to my hon. Friend, who is a former housing Minister. I share her pleasure that we have been able to introduce some important provisions to the Bill on the issue of overcrowding, which she has worked to achieve for a long time. Of course, as we seek to implement those provisions, we will take into account the issues of special needs that she has raised with me tonight and on previous occasions.

In its eighth and 10th reports, the Joint Committee on Human Rights expressed concerns that the absence of a duty on local authorities to give reasons for deciding which form of enforcement action to pursue under clauses 5 or 7 failed to comply with article 6 of the human rights convention on the right to a fair hearing; could lead to breaches of article 8 on respect for private and family life; and could lead to breaches of article 1 of the first protocol on the protection of property. The amendment responds to those concerns by placing a duty on local authorities to prepare a statement of reasons for their decision to take the course of action on which they have settled. We believe that this new clause responds positively to the Joint Committee's concerns without placing local authorities under a significant additional burden.

Lords amendments Nos. 212 to 214, 216, 218, 219 and 221 amend clauses 199, 203 and 204. In part, they respond to concerns of the Joint Committee on Human Rights and in part they are clarificatory. Clause 199 allows a local housing authority to require the production of documentation that the authority might need to carry out its functions under parts 1 to 4 of the Bill and to investigate offences committed in relation to any residential premises. In its 10th report, the Committee expressed concern that the lack of procedural safeguards, and the lack of requirement for authorisation, could lead to a risk of unjustified or disproportionate use of the powers in clause 199. Lords amendments Nos. 212 and 213 require that a person exercising the power to require the production of documents has been authorised in writing.

Clause 203 gives a local housing authority power of entry to properties in pursuance of its duties under parts 1 to 4 and part 7 of the Bill when certain conditions are met. Representatives of the authority must have written authorisation that sets out the purpose for which the entry is authorised and must give at least 24 hours notice to the owner or occupier of the premises they intend to enter. Permission under this clause does not include a power to use force to obtain entry. This power of entry includes entry for the purpose of taking samples. In its 10th report, the Committee expressed the view that the authorisation to express the power should be given at an appropriate level of seniority.

Clause 204 enables a justice of the peace to issue a warrant for admission to premises. This includes power to enter by force if necessary. This power is applicable, however, only when either entry under clause 203 has been refused, or the property is empty and immediate access is necessary, or prior warning of entry is likely to negate the purpose of access. Lords amendments Nos. 214, 216, 218 and 219 extend the power of entry in clauses 203 and 204 to include an express power for the purposes of inspections under clause 4. These amendments are clarificatory.

The concern of the Joint Committee that authorisations should be given at an appropriate level of seniority is addressed by Lords amendment No. 221, which introduces a new clause after clause 206. The new clause provides that authorisations under a number of powers in the Bill, including clauses 199 and 203, must be given by a relevant deputy chief officer of the local housing authority or by the officer to whom he reports or is directly accountable.

Sally Keeble (Labour, Northampton North)

Can my right hon. Friend let me know what kind of documents he was referring to when he referred to the production of documents?

Keith Hill (Labour, Streatham)

I am again grateful to my hon. Friend for that question. Of course, I will send her examples of such documentation. I hope that that reassures her of my positive, honourable and transparent intentions and I ask the House to support the amendment.

Lords amendment agreed to.

Lords amendments Nos. 2 to 54 agreed to [some with Special Entry].

Lords amendment No. 55 and Government amendment (a) thereto agreed to.

Lords amendments Nos. 56 to 100 agreed to [some with Special Entry].

Lords amendment No. 101 [Special Entry] and Government amendment (a) thereto agreed to.

Lords amendment No. 102 and Government amendment (a) thereto agreed to.

Lords amendments Nos. 103 [Special Entry] and 104 agreed to.

Lords amendment No. 105 [Special Entry] and Government amendment (a) thereto agreed to.

Lords amendments Nos. 106 to 127 and 129 agreed to [some with Special Entry].

Lords amendment No. 130 disagreed to.

It being Ten o'clock, Mr. Speaker, put forthwith the Questions necessary for the disposal of business at that hour, pursuant to Orders [28 June 2001, 6 November 2003 and this day].

Lords amendments Nos. 135, 137, 143 and 144 disagreed to.

Remaining Lords amendments agreed to [some with Special Entry].

Committee appointed to draw up Reasons to be assigned to the Lords for disagreeing to certain of their amendments to the Bill: Paul Clark, Matthew Green, Mr. John Hayes, Keith Hill and Mr. Terry Rooney; Three to be the quorum of the Committee.—[Paul Clark.]

To withdraw immediately.

Reasons for disagreeing to certain Lords amendments reported, and agreed to; to be communicated to the Lords.