Housing and Regeneration Bill

Public Bill Committee, 17 January 2008.

Clause 35

Iain Wright (Labour, Hartlepool)

I beg to move amendment No. 109, in clause 35, page 15, line 12, leave out from ‘HCA’ to end of line 14 and insert

‘acquires, constructs or converts any housing or other land for use as low cost rental accommodation’.

Joe Benton (Labour, Bootle)

With this it will be convenient to consider Government amendments Nos. 110 to 114.

Iain Wright (Labour, Hartlepool)

Good morning Mr. Benton, it is good to see you back in the Chair. May I wish a good morning to all members of the Committee.

I realise that this is not a clause stand part debate, but I shall briefly set out the background. Clause 35 is needed as a result of the split of the |Housing Corporation’s regulatory and investment functions. Therefore it requires that this new investment body, the Homes and Communities Agency, takes steps to ensure that low-cost rental accommodation provided as a result of its activities is adequately regulated.

While we would normally expect the agency to provide low-cost rental accommodation indirectly—a debate that we have had already during the course of the Committee’s deliberations—in the ways described in clause 35(3), (5) and (7) the agency will be able to provide low-cost rental accommodation directly. Amendment No. 109 relates to this direct provision by the agency. It makes it clear that, when the acquisition, construction or conversion activity by the HCA is intended to result in low-cost rental accommodation, the agency must ensure that a relevant provider of low-cost rental accommodation is the landlord when it is made available for rent.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

Does that mean that the Government intend the HCA not to end up operating as a landlord to tenants at any time?

Iain Wright (Labour, Hartlepool)

It is in the scope of the agency’s powers to act as a landlord, but I had an earlier debate with the right hon. Member for North-West Hampshire about this matter. The anticipated main focus of the agency’s activities would be to assist work in partnership with others—registered providers, councils, or whatever—in that respect, rather than actually being a direct landlord itself. But the scope and flexibility is there for the agency to do that.

The Homes and Communities Agency can dispose of housing or land to a person, provide infrastructure to a person—which we debated in clause 7—or give financial assistance to a person, on condition that the person “provides low-cost rental accommodation”. Where the agency does this, it must ensure that, where the accommodation is made available for rent, the landlord is a relevant provider—as defined in subsection (9).

Amendment No. 110 defines and clarifies the phrase “provides low-cost rental accommodation”, for the purposes of this clause. It means to construct, acquire or convert accommodation for use as low-cost rental accommodation, or ensure such acquisition, conversion or construction by another. Amendment No. 110 will effectively define “provides low-cost rental accommodation” when this is not done directly by the HCA. We thought it important to clarify what is meant when someone other than the HCA is commissioned to provide the accommodation. This is especially the case where the term “provider” bears a different meaning in part 2.

Clause 35 requires the Homes and Communities Agency to ensure that the landlord of low-cost rental accommodation provided as a result of its activities is a relevant provider as defined in subsection (9). Amendment No. 111 amends the definition of ‘relevant provider’ to include arm’s length management organisations or other entities controlled by a local authority, as well as a local authority or a registered provider. At present, ALMOs have managed only housing owned by the local authority. ALMOs—I have spoken to them and think that they are an exciting model—are increasingly interested in owning stock themselves. The agency could provide financial assistance, infrastructure or land to an ALMO for it to provide low-cost rental accommodation. This amendment would allow the ALMO to be the owner when the agency-funded accommodation is made available for rent.

The other amendments in this group are not strictly speaking related to this clause. Government amendments Nos. 112 to 114 relate to clause 36, which gives the Homes and Communities Agency powers to require the repayment or recycling of social housing assistance. These powers broadly re-enact the Housing Corporation’s powers in relation to recovery and recycling of social housing grant. As the agency has a general financial assistance power rather than specific grant powers limited to social housing, we need to define when the grant-recovery and recycling powers are available to the agency. We do not want these powers to be available in relation to financial assistance given by the agency for other purposes. For financial assistance given for purposes not related to social housing, we think that ordinary grant conditions suffice. However, the flexibility given by clause 36 is needed for social housing assistance.

Clause 36(8) defines social housing assistance as

“financial assistance given under section 22 on condition that the recipient provides social housing (whether by itself or as part of a wider project).”

Government amendment No. 112 defines “provides social housing”. The definition of “provides” is wider in this clause than in clause 35 because we think it appropriate for the agency to have the grant-recovery and recycling powers for grants given for a wider range of activities, including improving or maintaining social housing.

Nick Raynsford (Labour, Greenwich and Woolwich)

I do not want to anticipate the debate on the subsequent set of amendments, but it does seem peculiar that there is this proper definition of social housing in relation to clause 36, but that does not apply in relation to clause 35. That seems to be working entirely against the principle of achieving mixed-tenure developments and greater flexibility in tenure and not dividing the home-ownership sector from the rented sector. I cannot understand why the formulation has applied in clause 35, which is more restrictive.

Iain Wright (Labour, Hartlepool)

I understand my rt. hon. Friend’s point, and I do not want to pre-empt the debate that we are to have in a moment. The way I see the shaping of his amendments is that we need to be careful to have the most appropriate level of regulation. I think that that is the theme that will emerge from his amendments.

Government amendment No. 113 adds to the index of defined provisions for the purposes of part 1—in clause 60 a cross-reference to the definition of “provides social housing” in clause 36(8). Government amendment No. 114 clarifies the definition of arm’s length management organisations by reference to the local government legislation which defines when bodies are controlled by local authorities. ALMOs cannot, for the time being, register with the regulator as a provider of social housing, although, as the Committee will be aware, the Government intend to bring local authorities within the scope of the regulator within two years. For the time being, to avoid confusion and duplication, we have specifically excluded both local authorities and ALMOs from registration. As clause 35 makes clear, however, this does not prevent them from receiving financial assistance for social housing.

I hope that I have clarified the position with regard to the amendments.

George Young (Conservative, North West Hampshire)

I want to press the Government on amendment No. 109 because I am not sure that the Government fully understand the depth of concern within the housing association movement about the duties set out in clause 35 and in particular those set out in subsection (1), which Government amendment No. 109 effectively rewrites. This debate is to some extent the other side of the coin of the debates on clause 8 and clause 5. Those clauses dealt with the powers of the HCA, and the debate this morning is on the duties.

The defence that the Minister deployed when he defended the powers of the HCA is not available to the same extent when we deal with the duties because one can deploy the argument that certain powers are needed if X happens. That defence is not available when one addresses what are the duties and the functions, or indeed the business of the HCA as set out in chapter 4. The Minister did not convince me last week that the HCA would not have a much more interventionist role than the Housing Corporation has had to date. Let me remind him of what he said:

“I anticipate that that will not be the primary way in which it will support housing growth.”——[Official Report, Housing and Regeneration Public Bill Committee, 10 January 2008; c. 207.]

He said that in the context of what the HCA would do, but it did not give the housing association movement the reassurance that it was hoping for. He then had another go at column 216, but that did not take the trick either. He made it clear that the option of development was there, if the agency so wished, adding:

“However, where the circumstances demand, the agency will be able to take a direct role if it so wishes.”——[Official Report, Housing and Regeneration Public Bill Committee, 10 January 2008; c. 216.]

When we turn to chapter 4, which deals with the HCA’s functions in relation to social housing, however, we find that the first such function, which is set out in clause 35(1), relates to the circumstances in which the HCA itself

“acquires or constructs low cost rental accommodation”—

a provision that the Government now propose to replace through amendment No. 109.

The Minister may revert to what I call his model defence, which is that the clause is modelled on previous legislation. Were he unkind—he is not—he would refer to the Housing Associations Act 1985, which sets out the functions of the relevant authority, which, in that case, is the Housing Corporation. Section 75(e) of the Act refers to the relevant authority undertaking “to such extent as” it “considers necessary, the provision” construction, acquisition and conversion of dwellings. If the Minister were really unkind, he would ask who put that measure on the statute book, but he is not and he would not dream of doing so. However, the relevant point—perhaps he can address this—is whether the Housing Corporation has ever used the powers in section 75 of the 1985 Act, which are replicated in clause 35 of the Bill. My understanding is that it has never done so.

Nick Raynsford (Labour, Greenwich and Woolwich)

I share the right hon. Gentleman’s view that it is quite unlikely that the powers would be used in the framework of the existing Housing Corporation. However, the Bill creates a framework in which the corporation is merged with English Partnerships, which has land acquisition and development roles. The likelihood of the circumstances that the right hon. Gentleman describes applying will therefore be greater. Is that not a relevant consideration?

George Young (Conservative, North West Hampshire)

I would stand that argument on its head and say that while English Partnerships may have needed those powers, the new body does not because it incorporates that part of the Housing Corporation that had a direct relationship with housing associations, which obviates the need for English Partnerships to be able to provide housing directly. If the Housing Corporation never used those powers, the Minister must make the case as to why the HCA, the new body—as the right hon. Gentleman said, it is a different body—also needs them.

If clause 35 goes through unamended, there is a real risk that it will change the existing relationship between the Housing Corporation and the housing associations. The Housing Corporation is not a competitor to the housing associations; it is an enabler, provider and funder. Under clause 35, however, it will become a competitor. To put it differently, it is rather like one’s father suddenly dating one’s girlfriend—it totally changes the nature of the relationship and someone who was a benevolent provider of funds is then seen as a direct competitor.

The HCA will have a whole range of information available to it, so it will be in a privileged competitive position; it will know what the housing associations plan to spend on buying and developing a site. With that privileged information, it will be able to undertake the duties in subsection (1), as amended, to do it all itself. When the Minister replies, I want him to recognise that there is concern in the housing association movement about these powers and about the possibility that the HCA will become a competitor. Will he go further than he did in his earlier contributions to reassure the movement that the powers, if used, will be used sparingly and only if there is no alternative means of developing and providing social housing? Will he assure us that the powers in the clause relate not to the broader powers of English Partnerships but solely to social housing? That responds in part to the point made by the right hon. Member for Greenwich and Woolwich.

Can the Minister, first, recognise the concern and secondly, go far further in assuring me and the housing association movement that the good relationship between the corporation and the movement will not be changed by the HCA’s enthusiastic use of the powers in amendment No. 109?

Iain Wright (Labour, Hartlepool)

I enjoyed the questioning from the right hon. Member for North-West Hampshire. I would like to probe him further on the point about his father and girlfriend situation, but now is not the time—perhaps when the Committee is over and we are having a drink in the bar. I am clear about what the agency will do, and I hope that I can reassure the right hon. Gentleman. I am not certain I will be able to do so, because this is essentially a rehash of a debate we had on an earlier clause—clause 7, I think. The direct question from the right hon. Gentleman was about whether the agency would be building homes itself and, in effect, acting as a competitor to the housing association sector. The right hon. Gentleman should look at where we have come from. It is not my understanding that the Housing Corporation or English Partnerships have been involved in directly building homes in the recent past. I am not certain whether it happened a long time ago or if it happened at all.

I reiterate what I said to the right hon. Gentleman in the debate on the earlier clause; the powers are there for the agency to use, if they so wish. We see the agency’s role as facilitating, enabling and providing the skills necessary to help the RSLs, councils and other providers to step up to the plate and build houses. In our previous sitting we were discussing a culture change in the agency. It is important that we increase and accelerate the number of houses built, but even taking into account that culture change, I do not genuinely think that the agency will use its powers to provide housing directly, other than sparingly—to use the right hon. Gentleman’s words. More, it will act in partnership as a facilitator or an enabler for RSLs and others to do that job.

It goes back to a similar point about becoming the local planning authority and opportunity costs to the agency and what it could do with its resources, both staffing and financial. It can achieve an awful lot more by working in partnership and acting as a facilitator and enabling rather than directly providing. The power is there; we require the flexibility in the Bill, but I do not think that the power will be used frequently.

I hope that the right hon. Gentleman appreciates that clause 35 is a good thing. It ensures that low-cost rental accommodation is provided through registered providers and, therefore, can be regulated. As we come on to a subsequent part of the Bill, we see that we will be able to raise standards through the regulator.

Margaret Moran (Labour, Luton South)

Will the Minister give us examples of the way in which he foresees that the HCA might develop itself? I understand that there might be emergency situations in which it might need to develop, for example, if an RSL was failing. Can he give us specific examples and clarify whether the HCA will retain funding for itself rather than dispersing it for precisely this objective?

Iain Wright (Labour, Hartlepool)

It is difficult to envisage circumstances in which the agency will directly provide housing. I anticipate that it would be to provide confidence to the wider market. For example, it might enable a few units to be built to show what a development could look like, which might encourage other providers to come in. I imagine that it might do things at the start of a process to inspire confidence in the market. It might take action to get developments that are difficult to establish off the ground—quite literally. It is in those circumstances that I imagine the agency using a range of powers, of which the power directly to provide housing could be one. I hope that I have reassured my hon. Friend on that. I am happy for her to intervene, if she needs further clarification.

Margaret Moran (Labour, Luton South)

Perhaps the Minister can address the second point that I made on retaining funding for itself for that purpose.

Iain Wright (Labour, Hartlepool)

I understand the point and in that respect it would be building directly the units and therefore would be funding those units. I imagine that at some point it would want to provide that unit to a relevant registered provider—a housing association. I hope that that provides reassurance to my hon. Friend.

Robert Syms (Conservative, Poole)

The Minister may remember that there were problems with the Canary Wharf development. It went into liquidation and then was restarted. If a similar development got into financial difficulty, would the agency have the power to take it over, with the prospect of selling on or getting somebody else interested in the development? Would it be able to go broader than the housing remit, if there were office or commercial developments within a site?

Iain Wright (Labour, Hartlepool)

I draw the hon. Gentleman’s attention to clause 2(1), which says that the objects of the agency are

“(b) to secure the regeneration or development of land or infrastructure in England, and

(c) to support in other ways the creation, regeneration or development of communities in England or their continued well-being”.

So yes, it would certainly be able to do so in the circumstances that the hon. Gentleman outlined.

I hope that I have answered all the Committee’s questions.

Sir George Young rose—

Iain Wright (Labour, Hartlepool)

I see that I have not.

George Young (Conservative, North West Hampshire)

We have made substantial progress over the past week because the Minister has retreated from the earlier trench, which was that providing housing would not be the agency’s primary objective and that it would be able to take a direct role if it so wished. He has retreated from that to what he said just now, which was, “I think these powers will be sparingly used”. Then he went into a different trench, when he said that it was “difficult to envisage the circumstances in which—” they would be used. So a lot of progress has been made.

I have no objection to the rest of the powers which enable the HCA to fund other organisations and I hope those will be used and produce the same sort of output that was being produced some 10 or 12 years ago. I think that the National Housing Federation will want to reflect on the exact words that the Minister used in his response to see if it gives them the assurance they are looking for that the HCA will not use its powers to emerge as a direct competitor to housing associations. On that basis, I would not dream of seeking a Division on the Government amendment.

Iain Wright (Labour, Hartlepool)

Perhaps I should not try to catch your eye, Mr Benton, when I am on a good thing. I am pleased that the right hon. Gentleman is reassured, but I do not think I have changed my position. We have always said that we expect that the primary function will be to enable others to step up to the plate in order to improve the supply of housing in England, and that the power to provide housing would be used sparingly, so I do not think I have been inconsistent. We would expect the agency to act as a partnership, but I am pleased that the right hon. Gentleman is reassured. Before I go into another trench, I think I had best sit down.

Nick Raynsford (Labour, Greenwich and Woolwich)

I beg to move amendment No. 51, in clause 35, page 15, line 13, leave out ‘low cost rental accommodation’ and insert ‘social housing’.

Joe Benton (Labour, Bootle)

With this it will be convenient to discuss the following amendments:

No. 52, in clause 35, page 15, line 15, leave out ‘low cost rental accommodation’ and insert ‘social housing’.

No. 53, in clause 35, page 15, line 19, leave out ‘low cost rental accommodation’ and insert ‘social housing’.

No. 54, in clause 35, page 15, line 21, leave out ‘low cost rental accommodation’ and insert ‘social housing’.

No. 55, in clause 35, page 15, line 25, leave out ‘low cost rental accommodation’ and insert ‘social housing’.

No. 56, in clause 35, page 15, line 27, leave out ‘low cost rental accommodation’ and insert ‘social housing’.

No. 57, in clause 35, page 15, line 30, leave out ‘low cost rental accommodation’ and insert ‘social housing’.

No. 58, in clause 35, page 15, line 32, leave out ‘low cost rental accommodation’ and insert ‘social housing’.

No. 59, in clause 35, page 15, leave out line 38 and insert

‘“social housing” has the meaning given by section 67.’.

Nick Raynsford (Labour, Greenwich and Woolwich)

As we have already established, the clause to which these amendments relate is likely to have a limited application. The right hon. Member for North-West Hampshire conceded that the Government in which he served as a Minister put this provision in the Housing Associations Act 1985, so they envisaged circumstances in which it might apply, and that remains the case.

It is likely, as the powers of the Housing Corporation are being combined with those of English Partnerships, that there will be circumstances in which the agency, as part of its role in development and supporting regeneration, may wish to be a partner in a development, possibly with a private developer. It could perform this function before transferring the property across to an appropriate housing association or other body to manage. There may be more circumstances in which this would apply, but as my hon. Friend the Minister has made clear, these will probably be relatively limited in number.

The problem is why the clause has been written in a way that limits the provisions to cases in which low-cost rental accommodation is involved. In practice, the rest of the Bill is based on a formulation of social housing which embraces both low-cost rental housing and low-cost home ownership.

Clause 67 defines social housing as

“(a) low cost rental accommodation (defined by section 68), and

(b) low cost home ownership accommodation (defined by section 69).”

It seems odd that in clause 35, which is headed “Duties in relation to social housing”, not low-cost rental housing, the definitions are all limited to low-cost rental. There must be some purpose behind this. It is all the more odd to me because it runs completely counter to our understanding of the importance of mixed-tenure developments, in which one does not have rigid divisions between certain types of tenure—rented in one place and owner-occupied in another.

We understand that there is a need for greater flexibility, for people to be able to move between the rented sector and the ownership sector, possibly by means of low-cost options on the way. That is very much part of the current thinking. The Government are also strong in their advocacy of mixed communities. That does not seem to fit comfortably at all with a provision under the heading “Social housing”, which is clearly limited to only one part of that social housing.

We also know from experience that integrated management of new developments, where there is mixed tenure, is often critical to the success of those developments. If there is fragmented management, with different bodies managing different parts of the housing in an estate, there is a greater likelihood either for confusion or for lack of clarity and a failure to deal with problems as and when they arise. All good thinking at the moment is very supportive of integrated management. That all argues rather forcefully in favour of an approach that does not separate out provisions in relation to low-cost rental accommodation from provisions for low-cost home ownership.

A clinching argument can be found in clause 70, which is entitled “Shared ownership low cost rental”, and is very germane indeed. The clause states:

“Accommodation which is both low cost rental accommodation and low cost shared ownership accommodation is to be treated as the latter and not as the former.”

Therefore, if one has a combination of low-cost rental and low-cost ownership, it is to be defined as low-cost ownership, not low-cost rental. Why on earth are the Government seeking in this clause to apply these provisions only to low-cost rental rather than to the whole social housing field? That seems to be a pretty convincing case.

If one looks at this slightly further and thinks about the limited circumstances in which these provisions might apply, I can see all sorts of scope for perverse incentives if the formulation currently in the Bill is not amended. That is why I have tabled these amendments. Let us take, for example, a circumstance in which the agency, in partnership with a private developer, is undertaking a regeneration project to achieve the regeneration of an area in need of investment. That private developer says, “I don’t want any low-cost rental housing on this development. I want it to be a nice, upmarket development, with housing for sale and low-cost home ownership, but I do not want social rented housing.” Under the current provisions, that developer would have a rather persuasive case. It could say to the agency, “Let’s keep this development such as to exclude social rented housing. That way we won’t have to engage a provider of social housing in the management of it. As the developer, I can continue to manage the whole thing and you will have no responsibility to hand over to another body.” That would be a perverse incentive against the provision of social rented housing, which is exactly the contrary of what we are trying to achieve in encouraging developers to undertake mixed developments with social rented housing as well as low-cost home ownership.

There are other potential problems. The Minister implied, in his response to my intervention on the previous group of amendments that the reason for this formulation was to do with the burden of regulation.

I have to tell him that there is real concern in the housing association movement that the Bill does not achieve a level playing field regarding the regulatory arrangements applying to the housing association sector as against the private sector. If the provision continues to apply as way formulated in clause 35, the fears that private sector providers will be subject to a less onerous and less demanding regulatory regime than housing associations will be given added force.

I sincerely hope that the Minister will reconsider the matter and accept that there is an overwhelmingly strong case to apply the provisions of clause 35 to all social housing as implied by the clause heading. I hope, in the interests of diversity and flexibility of tenure, and the need for good, integrated management and a level playing field between tenures, that he is willing to accept the amendments.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

The purpose of the Committee stage of a Bill is to seek to improve it. Sometimes we have political arguments that come down to philosophical differences of view or, indeed, party political differences of view. This is not one of those occasions, as we are talking about something that is of great logical importance if we are to maintain the consistency of the clause in the context of the Bill as a whole. I need not repeat the argument made by the right hon. Member for Greenwich and Woolwich, but it is unequivocally clear from what he has outlined that low-cost rented accommodation is a subset of social housing. As he pointed out, clauses 68, 69 and 70 underline that point and go to some lengths—especially clause 69—to explain that all three constitute the sum of what social housing means.

This is not a semantic point. I hope that the Minister accepts that the amendment is a genuine improvement to the Bill, as its argument is compelling. I see no reason why he should not accept it. The only circumstance in which the Government should refuse to accept it is if they explicitly want to exclude owner-occupied social housing from the purposes of the clause. I am sure that the Minister does not intend to do so. I suspect that this is simply a drafting omission. I hope that he will accept what is inherently a simple and straightforward improvement to the Bill.

Iain Wright (Labour, Hartlepool)

My right hon. Friend the Member for Greenwich and Woolwich and the hon. Member for Montgomeryshire have made a good case with their usual forthrightness and eloquence. The amendments are designed to replace the term “low cost rental accommodation” with the term “social housing”. Amendment No. 59 defines social housing in the same way as clause 67, as my right hon. Friend mentioned.

Clause 35, about which we have already had a bit of a debate, ensures that low-cost rental housing, whether provided directly or funded by the Homes and Communities Agency, remains in the social housing sector and has a landlord who is regulated. As I said earlier, that is necessary because of the regulatory and investment split that the Bill provides with regard to the agency and the regulator. If the landlord is a registered provider, tenants are protected by the Oftenant regulatory regime. Local authorities and arm’s length management organisations are regulated through statute and the local government performance regime involving the Audit Commission.

I listened carefully to what my right hon. Friend and the hon. Gentleman said. However, the amendments would require the HCA to ensure that homes for low-cost home ownership as well as for low-cost rental are owned by a registered provider, local authority or ALMO. That is not necessary. I return to the point that I trailed in relation to earlier amendments about the regulatory regime. My right hon. Friend made a very strong case about the need to ensure that we have a level playing field, but he will accept that low-cost home ownership requires a lighter regulatory touch than low-cost rental accommodation. We are confident that the appropriate degree of regulation for low-cost home ownership can be achieved either through the regulator or, crucially, through the agency imposing conditions on the financial assistance that it provides under clause 22.

Nick Raynsford (Labour, Greenwich and Woolwich)

In the aftermath of the sub-prime market problems in the United States, and given the position of the housing market here, I am not sure that I am convinced by the argument that the provision of low-cost home ownership should be subject to a lighter regulatory regime than the provision of social rented housing.

Iain Wright (Labour, Hartlepool)

I take my right hon. Friend’s point, but what we suggest is similar to the low-cost home ownership schemes now provided under contract with the Housing Corporation.

My right hon. Friend spoke eloquently about rigidity and the fact that we want to provide mixed communities. I agree with him. The regime proposed under clause 35 provides the corporation—in future, the agency—with the flexibility to invest as it sees fit while ensuring that purchasers are protected. My right hon. Friend makes a strong case, but I should like to reflect on the matter to see whether we can address those concerns. What he said about the sub-prime market was valid, and I shall see whether we can do anything to reassure him at a later stage.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

It is obviously for the right hon. Member for Greenwich and Woolwich to decide whether that assurance is sufficient, but the Minister is taking the matter seriously. He obviously understands that if he does not accept the amendment or something similar it on Report, the Government will explicitly be excluding owner-occupied social housing from the provisions of clause 35.

Iain Wright (Labour, Hartlepool)

I understand what the hon. Gentleman says, and I appreciate the depth of feeling on the subject, as expressed by himself and by my right hon. Friend the Member for Greenwich and Woolwich.

As I said, I come to this from the starting point that, in the main, low-cost home ownership schemes need a lighter regulatory touch, but I understand the concerns that have been expressed. However, I do not want to mislead the Committee. I have explained my standpoint: a light-touch regulatory regime is appropriate, and things should be regulated through contract and the housing ombudsman. If my right hon. Friend will allow me, I shall reconsider the matter, and I therefore hope that he will withdraw the amendment.

Nick Raynsford (Labour, Greenwich and Woolwich)

I am grateful to my hon. Friend for that offer. I hope that when he reflects on the matter that he will consider the importance not only of an appropriate regulatory regime for the low-cost home ownership market, but of integrated management and diversity. I hope, too, that he accepts the benefit of not creating a framework that might bring about perverse incentives that would work against the provision of social rented housing, such as the problem I cited in the example that I gave earlier. All those arguments are persuasive, and I hope that when he reflects on them, the Minister will see the case for tabling amendments broadly in line with those that I have tabled today. In the light of his undertaking, I beg to ask leave to withdraw the amendment.

Grant Shapps (Conservative, Welwyn Hatfield)

I beg to move amendment No. 67, in clause 35, page 15, line 15, after ‘ensure’, insert ‘either’.

Joe Benton (Labour, Bootle)

With this it will be convenient to discuss the following amendments:

No. 68, in clause 35, page 15, line 17, at end insert

‘or that a relevant provider of low cost rental accommodation is the manager and another person is the landlord of the accommodation’.

No. 69, in clause 35, page 15, line 21, after ‘condition’, insert ‘either’.

No. 70, in clause 35, page 15, line 23, at end insert

‘or that a relevant provider of low cost rental accommodation is the manager and another person is the landlord of the accommodation’.

No. 71, in clause 35, page 15, line 26, after ‘ensuring’, insert ‘either’.

No. 72, in clause 35, page 15, line 28, at end insert

‘or that a relevant provider of low cost rental accommodation is the manager and another person is the landlord of the accommodation’.

No. 73, in clause 35, page 15, line 31, after ‘ensuring’, insert ‘either’.

No. 74, in clause 35, page 15, line 33, at end insert

‘or that the relevant provider of low cost rental accommodation is the manager and another person is the landlord of the accommodation’.

Grant Shapps (Conservative, Welwyn Hatfield)

Good morning, Mr. Benton.

Iain Wright (Labour, Hartlepool)

How is the hon. Gentleman’s hip?

Grant Shapps (Conservative, Welwyn Hatfield)

Much better.

We have spent a little time discussing clause 35. The Minister knows of our concern from discussions soon after the Bill was published, and he has been constructive in his understanding and appreciation of the problematic impact that the drafting of the clause could have on the market. However, I am not convinced that the redrafting proposed in Government amendments Nos. 109 to 114 and in the amendments tabled by the right hon. Member for Greenwich and Woolwich, which are to receive further consideration, quite nail the point.

One of the difficulties of such discussions is the fact that the matter can be argued in such terribly technical terms that it would be difficult for anyone reading the Official Report to understand. We must therefore be clear about the subject of our discussion. It is my understanding that under the clause as amended, a builder, perhaps one of the Barratts of this world, who was creating a development on land owned by the HCA—that builder would normally construct a development and hand it over to a housing association to run—would, if the land continued to be owned by the HCA, have to be the landlord. There is a mix-up between the provider and the landlord, and I do not think that the clause as amended deals properly with that problem. I am certain from conversations with the Minister that that is not the Government’s intention but, none the less, it would be the outcome if the provisions were accepted in their current form.

In the spirit of co-operation displayed in relation to the previous group of amendments, will the Minister look again at the examples and reassure himself and us that the drafting will not inadvertently create a situation in which the provider and the landlord must be the same? Another obvious example would be a group trying to create one of the recently established shared ownership real estate investment trusts. It would own the stock, but would it be permissible for the housing association to end up managing it, as would normally happen, if the HCA were involved in the land deal? It seems to be the same situation as I described with the house builder, and I understand from the provisions as drafted that the answer would be no.

I do not want to labour the issue, because we have spent three quarters of an hour on it, and many relevant points have been made by my right hon. Friend the Member for North-West Hampshire and other members of the Committee, but will the Minister reassure us that he will take seriously the concern about mixing up providers and landlords, reconsider the matter and report back to the Committee later?

Iain Wright (Labour, Hartlepool)

I have a great deal of sympathy with the sentiments behind the amendment. It is probably far too early in the morning for me—I am being far too amenable for my own good—and I prefer the later sittings. The hon. Gentleman is on to something and the motivation behind the amendments is sound. He is trying to give the agency more flexibility while protecting tenants.

However, that is where it stops. I think that the hon. Gentleman will agree with me that there are certain key aspects of regulation that can fall only on the owners of the property. Regulation, as he will accept, protects public investment in social housing by requiring owners to seek disposal consent from the regulator or the Secretary of State for Communities and Local Government before selling a property. It also, for example, requires the owners of a home sold to the tenant under the right-to-acquire scheme to reinvest the proceeds through the statutory disposal proceeds fund. Those are key protections, which it is essential to maintain.

Registered providers can appoint a manager to carry out day-to-day management of their properties. The regulator can operate or approve accreditation schemes for such managers, and if a commercial developer, as the hon. Gentleman suggested, wanted to appoint a manager or indeed another registered provider to carry out that detailed work, that would be perfectly possible within the existing framework. However, the fundamental point is that the owner must still be registered to ensure that investment from the public purse is protected. So, while I am sympathetic to his concerns, I ask the hon. Gentleman to withdraw the amendment.

Grant Shapps (Conservative, Welwyn Hatfield)

We are getting close to clarification. Will the Minister confirm that it is his understanding that under the clauses a developer would be able, as happens now, to use a registered social landlord—a housing association—to manage the property? He referred just now to the possibility of bringing someone in to manage the day-to-day aspects of the property. That did not sound quite the same as what he said about a housing association being brought in. Will he just confirm that the relevant format could involve a housing association?

Iain Wright (Labour, Hartlepool)

I shall try to clarify the position. The direct answer to the question about housing built by Barratt on land owned by the HCA is no: the point is that when the housing becomes low-cost rental housing, the landlord is a relevant provider. The provision does not force Barratt to register, or stop it making a transfer to a housing association. I hope that clarifies the point and reassures the hon. Gentleman. Although I have much sympathy with what he said, I hope that he will withdraw the amendment.

Grant Shapps (Conservative, Welwyn Hatfield)

On that basis, and with the assurance recorded in Hansard, I beg to ask leave to withdraw the amendment.

Clause 36

George Young (Conservative, North West Hampshire)

I refer the Minister to an exchange that took place on 11 December when the Council of Mortgage Lenders appeared before us and was exposed to some questioning from the Committee. In particular, I refer to column 65, which deals specifically with clause 36. Mr. Richard Hughes, the CML representative, stated:

“On our reading, clauses 36 and 37 seem to say that the HCA can demand its grant back and a return on it—we assume some sort of equity-style return.”——[Official Report, Housing and Regeneration Public Bill Committee, 11 December 2007; c. 65.]

I have to say that I did not share the CML’s concern, but I will not be lending any money. It is important that the CML is confident that the security their members have when they advance funds is such that they will continue to lend. Has there been any dialogue since that exchange on 11 December between the Minister’s Department and the CML that indicates that the organisation is no longer concerned about clause 36 and that it does not want the amendment it sent to members of the Committee but which no one tabled—a proposed new subsection (4)(c) to clause 36, which deals with the recovery of social housing assistance—and that the sort of difficulties that were envisaged in the exchange will not, in fact, occur if clause 36 goes through without its amendment?

Iain Wright (Labour, Hartlepool)

I thank the right hon. Gentleman for that line of questioning. I do not have the Hansard for 11 December in front of me, but I seem to recall from my genning up for this debate that the right hon. Gentleman was extraordinarily helpful to me in respect of this matter. I believe he realises, because I think he made the point in December, that the provisions are not, in essence, a change in policy terms or in the legal framework. He mentioned in December that the Housing Corporation operates a similar system under the Housing Act 1996, and I believe he agrees that it is not unreasonable to require repayment of more grant than had been originally understood would go unchallenged.

On the direct point about dialogue between officials and the CML, I assure the right hon. Gentleman that my officials have been discussing the matter with the organisation. The discussion is ongoing, because we are keen to reassure the CML of the nature of the clause and subsequent relevant clauses, and to ease its concerns. I believe that the dialogue has proved fruitful, and I hope that I have reassured the right hon. Gentleman in that regard.

Clause 37

George Young (Conservative, North West Hampshire)

I am grateful to the Minister for what he just said about clause 36. It is a relief to us, and I hope that the dialogue ends with a happy resolution.

The CML also raised a specific problem with clause 37. I quote from the note that it sent to all members of the Committee:

“This section appears to pass on the requirement to repay grants...to successors in title.”

I do not think that anybody has any difficulty with that. The note goes on to state:

“If this is the case then security valuations would have to be adjusted to reflect the obligation of a successor in title to repay grant. This would mean that current registered providers could all be in breach of their loan covenants and would impact negatively on the financial capacity of registered providers going forward.”

I put the same question to the Minister as I did on clause 36: is there is a dialogue on the clause, and has his Department been able to satisfy the CML that the risks outlined in the passage that I have just read out do not exist, and that there is no impediment to its continuing to fund housing associations?

Iain Wright (Labour, Hartlepool)

Once again, I thank the right hon. Gentleman. He is right to suggest that my response will be similar to that on clause 36. He will know that the provisions of clause 37 are the same as those in the Housing Act 1988 and the Housing Act 1996. We are looking into the CML’s point about how the operation of the determinations will interact with repossessions and so on. Dialogues are ongoing between officials and the CML, and they are proving fruitful. We are trying to reassure the CML as much as we can, which is having a productive conclusion. I hope that reassures the right hon. Gentleman.

Clause 38

Grant Shapps (Conservative, Welwyn Hatfield)

I beg to move amendment No. 6, in clause 38, page 17, line 25, leave out ‘as it considers appropriate’ and insert

‘before making such a determination’.

The amendment is intended to clarify some vague wording in the clause. Its purpose is to ensure that the HCA must consult bodies representing the interests of registered providers of social housing before making a determination. On page 17, clause 38(2) states:

“Before making a determination, the HCA must consult...

(b) such other persons as it considers appropriate.”

The other day we debated who “other persons” might be. It was unclear at the time, but the Minister kindly gave some clarification later in the day. “Other persons” seemed to include people other than those whom I had suggested would be included, so I would be interested to know which “other people” subsection (2)(b) refers to.

The amendment would leave out the words “as it considers appropriate” and insert

“before making such a determination”,

to remove the vagueness of the wording and tighten up the fact that there should be more specific consultation before determination under clauses 36 and 37. Who are envisaged as “other persons” in that context, and will the Minister consider tightening up the language to ensure that specific consultation must take place?

Iain Wright (Labour, Hartlepool)

I suggest to the hon. Gentleman that the amendment would not really add anything to the effect of the clause. I draw his attention to subsection (4), which states:

“The HCA must, in particular, consult such bodies appearing to it to represent the interests of registered providers of social housing as it considers appropriate.”

The amendment would leave out “as it considers appropriate”, and would thus apparently require the agency to consult all bodies representative of registered providers of social housing, rather than just those the agency considered appropriate, which would, I suggest, remove the agency’s discretion as to whom it may consult.

I know that the hon. Gentleman says that the amendment would avoid vagueness, but it would mean that the agency did not have discretion, which would increase the risk of the agency’s decisions being successfully challenged due to a failure to consult every single representative body, including those unaffected by particular determinations. That could be unwieldy and unnecessarily bureaucratic. I am sure that is not what the hon. Gentleman intended, although I understand the sentiment behind the amendment. To avoid that vagueness and ensure that the agency has a degree of discretion, I hope that he will withdraw the amendment.

Grant Shapps (Conservative, Welwyn Hatfield)

I understand what the Minister says, and far be it from me to want legislation that is more cumbersome and bureaucratic than it needs to be, but I did not understand from his response who the “other persons” are. May I press him on that point?

Iain Wright (Labour, Hartlepool)

I am afraid that I shall have to disappoint the hon. Gentleman. It would depend on the particular circumstances, and it would be whoever the agency considered appropriate.

Grant Shapps (Conservative, Welwyn Hatfield)

Will the Minister at least clarify who he imagines the “other people” might be?

Iain Wright (Labour, Hartlepool)

We could perhaps take a particular circumstance and then suggest who might be considered appropriate. A wide range of circumstances might be covered, and the agency needs considerable discretion when deciding who to bring forward. I, therefore, throw the question back at the hon. Gentleman: if he can suggest a particular circumstance, we could bat it about further.

Grant Shapps (Conservative, Welwyn Hatfield)

I am still curious, because not a single name or organisation has been mentioned. I want to clarify whether the Minister understands the intention of the clause. The other day, it turned out that nobody in the Committee knew which persons were meant to be represented under a particular clause. It took some time, and a lunch break, to calculate the list. I should be grateful if the Minister could tell us what is meant by “such other persons”, and if he could provide us with examples of whom they might be. However, if he cannot but could undertake to find out and tell us later, I would be happy to withdraw the amendment.

Iain Wright (Labour, Hartlepool)

I am happy to do that. However, I repeat that it would be extraordinarily helpful for me, in order to provide some clarification and to reassure the hon. Gentleman, if he could suggest particular circumstances in which we might consider the proposal appropriate.

Grant Shapps (Conservative, Welwyn Hatfield)

I did not draft the legislation, and it needs to be explained by those who did—the Government. It is not unreasonable to ask what a particular line in legislation means, and it is for the Minister to provide that clarification to the Committee, rather than the other way around.

Mr. Wright rose—

Joe Benton (Labour, Bootle)

Order. We cannot go on like this for too long. We have reached the point when either the amendment must be pressed or withdrawn. Having said that, I shall allow the Minister to reply one more time.

Iain Wright (Labour, Hartlepool)

One of the groups that would usually be consulted is the National Housing Federation, but there would be others, too. I hope that reassures the hon. Member for Welwyn Hatfield.

Grant Shapps (Conservative, Welwyn Hatfield)

I should be grateful if the Minister would send me a letter with further details about the matter, but, taking your advice, Mr. Benton, I beg to ask leave to withdraw the amendment.

Clause 40

George Young (Conservative, North West Hampshire)

I think that clause 40 is the first part of the Bill where the regulator of social housing is mentioned. We will have a much more substantive discussion about his role later on. This is rather like Beethoven’s opera, “Fidelio”, in which the hero does not appear until the second act. However, can the Minister, who has announced the chief executive of the HCA, say anything about who the regulator is? Has he been announced? If not, how far have the Government got in the process of appointing him?

The clause states that the HCA must co-operate with the regulator. At present, the regulator and the investor share the same building. Is it envisaged that the HCA and the regulator will be co-located, or that they will be separately accommodated? Furthermore, will the Minister shed some light on clause 40(2), which states that

“the HCA must consult the regulator on matters likely to interest the regulator.”?

What does that mean? We are imposing a statutory duty on the HCA, and in fairness to it we should shed some light on what information it will be legally obliged to pass on to the regulator.

Iain Wright (Labour, Hartlepool)

The process of appointing the regulator is ongoing, but when we come to part 2 of the Bill, I might be able to update the Committee on progress. As for co-location of the agency and the regulator, that is an operational decision, but we do not intend that there should be a physical separation as well as an organisational separation.

The right hon. Gentleman’s third line of questioning was about the circumstances in which there would be co-operation between the regulator and the agency. That is crucial, because, as he rightly said, we have previously had a merging of the regulatory and investment functions. The regulator will be concerned to see that registered providers are responsive to tenants and that their businesses remain viable, because that will help to raise standards for tenants. Crucially, it will need to understand the stresses of business, particularly the ability to borrow money.

As the investing body, the agency will be also be interested in the ability to borrow money, and will need to have an understanding of such matters when making investment decisions. It would be sensible for the agency to consult the regulator when developing its investment policies to understand the overall ability of registered providers to deliver. It is in everyone’s interests to ensure that the capacity and delivery capability of the sector is advanced as much as possible. In short, a close dialogue will be needed, while the regulator should maintain a clear independence, as has been set out and universally acknowledged. I hope that reassures the right hon. Gentleman.

George Young (Conservative, North West Hampshire)

Does the Minister propose to codify or clarify exactly what the relationship between those two organisations should be? At the moment, the measure says simply “must consult”, and the Minister has been good enough to outline the sort of information that ought to be exchanged. Should not that be formalised in some way, so that both partners in the new relationship know exactly what they are obliged to tell the other about?

Iain Wright (Labour, Hartlepool)

Yes, the right hon. Gentleman makes a good point. We anticipate that there will be a memorandum of understanding between the agency and the regulator to codify such issues as much as possible. I hope that reassures him.

Clause 41

Nick Raynsford (Labour, Greenwich and Woolwich)

I broadly support the purpose of the clause, which is to give the new agency powers to provide information, disseminate ideas and undertake research, thus carrying forward powers that are available to the Housing Corporation and English Partnerships. I seek guidance from my hon. Friend the Minister on whether he envisages any new areas in which research may be undertaken, information may be provided or ideas disseminated—[Interruption.]

Joe Benton (Labour, Bootle)

Order. The level of background noise is getting rather high.

Nick Raynsford (Labour, Greenwich and Woolwich)

Thank you, Mr. Benton.

I simply seek guidance on whether there are likely to be any new areas of initiative taken by the new agency. If so, what is the thinking behind that and what are the resource implications? I understand, from our debates on Tuesday on an earlier clause, that the agency will be able to recover reasonable costs by levying charges for providing information or research. It would help to know whether that is likely to involve any expansion of the agency’s activity and, if so, in which areas.

Iain Wright (Labour, Hartlepool)

My right hon. Friend raises an interesting point. Given that there needs to be a step change in what the agency does, in comparison with its predecessor organisations, I anticipate that it will work in new fields, such as project management. I understand that English Partnerships and the Housing Corporation already have such roles, but I imagine that there will be new and innovative research on project management and perhaps communication.

We have talked about how the agency will have to have a key role—a primary role, following my response to my right hon. Friend—in facilitating, enabling, partnership working and community engagement. I do not want to box the agency in on what it does, but I imagine that as a resource hub and repository of best practice, it will help people step up to the plate and local communities to become involved in planning permission. It will also help to ensure that infrastructure projects are understood and communicated as much as possible.

In our deliberations on clause 27 my hon. Friend the Member for Luton, South mentioned concerns that work at the Housing Corporation’s centre for research and market intelligence might be restricted if the agency were to undertake it using the powers in clause 41. The HCA would be able to take on the work of the CRMI under that clause and the following one, and would not be restricted in any way by the wording of clause 41. I hope that addresses my hon. Friend’s concerns, and that I have answered my right hon. Friend’s points about how the agency will provide research.

Clause 42

Nick Raynsford (Labour, Greenwich and Woolwich)

This is a supplementary point about the Academy for Sustainable Communities, the body that is likely to become Cinderella to the new agency unless we draw attention to it. All our discussions have been about the merging of the Housing Corporation and English Partnerships, the two big components of the new body, but the third component is the academy, which has an important role in advice, education and training—the subjects of the clause. I should be grateful if my hon. Friend the Minister could indicate the areas where the academy, in its new role as part of the agency, will address the challenges that we face, not least of appropriate skills for the achievement of the Government’s ambitious housing and regeneration targets.

Robert Syms (Conservative, Poole)

Over recent years, we have seen the importance of involving communities, particularly disadvantaged communities, on many of the larger estates. I am thinking of places such as Castle Vale in Birmingham, where major schemes have involved tenants and communities. Does the Minister envisage that an element of the measure could be to help train community members to be advocates for their communities and put forward what people want at grass roots, so that when there are development schemes, one is better able to drill down, there is no top-down process and the HCA does its best to involve local communities and get community members to say what their communities want in the way of redevelopment and sustainability?

Iain Wright (Labour, Hartlepool)

I am grateful to the Committee for bringing the issue to wider attention. My right hon. Friend the Member for Greenwich and Woolwich is right: although the focus has been on the establishment of the HCA due to the merger of English Partnerships and the Housing Corporation, we should not forget the vital role of the Academy for Sustainable Communities in ensuring that we have real community engagement. I am excited by what the academy does, and there is a real opportunity in the Bill to expand its work.

To touch on what my right hon. Friend said about clause 41, the academy focuses on broader generic skills, such as project management, vision, communication, partnership working and community engagement, and following my response to him on that earlier clause, I anticipate that the academy will expand its role. The academy has identified three broad areas and three major audiences on which its work programmes will focus when it becomes part of the agency. The three major audiences include young people, because it will need to capture their interest, raise their awareness of sustainable community issues and encourage them to go into sustainable community careers. Having spoken to stakeholders, I know that there is a potential skills shortage, which may affect the number of people going into sustainable community careers, such as architecture and landscaping. I know, too, that my right hon. Friend is working hard on the issue.

We must work to encourage people to have a stake in their communities and to realise that quality of life and the built environment are important. People can become productively and positively involved in their communities by taking up careers as planning surveyors, architects or landscapers. I am really excited by that work and I would like to drive it forward, certainly at ministerial level.

Margaret Moran (Labour, Luton South)

Does my hon. Friend envisage the expansion of some of the ideas that he has outlined? For example, I have been working closely with Ashram housing association in Birmingham, which has worked with its south Asian women tenants to ensure that they gain qualifications in design and architecture and can help to design their own homes. Such schemes give people skills and potential for employment, while dealing with issues such as sustainable communities and regeneration. I hope that the HCA will take a much more positive role in expanding such projects.

Iain Wright (Labour, Hartlepool)

I certainly hope so, too. I am pleased that my hon. Friend mentioned Ashram, because its representatives have been to see me. We talked about skilling specific diverse communities and about ensuring that in areas where black and minority ethnic communities, women and younger people are not involved in the careers that I mentioned they step up to the plate to ensure that they become involved. That is vital, so I am really encouraged and excited by what is going on and I want to see those things go forward. The academy is really good and will make still more progress when it is in the agency.

Nick Hurd (Conservative, Ruislip - Northwood)

Of course, the Bill is not the only opportunity for the Academy for Sustainable Communities to expand now that the Sustainable Communities Act 2007 is on the statute book. As the promoter of the private Member’s Bill that led to the Act, I am obviously delighted to support the academy’s expansion. May I press the Minister a little further, however, on what expansion means in this context? How much more financial assistance will the Government put into that expansion?

Iain Wright (Labour, Hartlepool)

That will be an operational decision for the agency’s chief executive and senior management. The clear expectation is that the agency will help people to realise what they can do to promote sustainable communities. In that respect, I pay tribute to what the hon. Gentleman did in the 2007 Act. However, if the agency is really to step up to the plate to ensure that communities are engaged and that potential barriers to housing growth and community infrastructure are identified, addressed and resolved, the academy will need to play a bigger role. That is what I mean by expansion.

I have mentioned young people and potential skills shortages, but let me also mention professionals because the professional bodies have a role to play. The academy has identified the need to target professionals and deliver a co-ordinated programme of integrated learning and skills training to those working in sustainable communities. That will improve their skills and awareness and ensure that future generations are attracted to the relevant professions and that those working in them are excited by them and want to move forward still further. Again, this is a real opportunity, and I am really excited by it.

The third strand of the work programme identified by the academy relates directly to the point made by the hon. Member for Poole about community leaders. The academy wants to raise awareness and understanding of sustainable community issues among community leaders and to support the building of the capacity and capability to deliver on those issues.

From what I have heard, the whole Committee is really excited, as I am, about the Academy for Sustainable Communities. As John F. Kennedy said,

“Ask not what your country can do for you; ask what you can do for your country”,

and the academy will be doing that on a sustainable community level. It is really exciting that people can make an impact in their area by using architects, landscapers and planning surveyors to raise standards and quality of life, and that planning and design, which we mentioned on earlier clauses, can play a central role. Through the agency, the academy will be able to ensure that that happens. I have been encouraged by our debate, as I hope other hon. Members have been, and I hope that they will be attracted to stuff that is going on in their constituencies and will ensure that the agency plays a part across the country.

Clause 43

Lembit Öpik (Liberal Democrat, Montgomeryshire)

I notice that the Minister has resorted to quoting John F. Kennedy, which is appropriate because the Bill has such a wide remit that technically it could organise a moon landing and not go beyond the limits of its involvement.

Iain Wright (Labour, Hartlepool)

I think we need a debate on whether the agency will be a direct provider of the moon launch, because I know that the hon. Gentleman is interested in space and asteroids. Would it help to facilitate that moon landing, or would it be a direct provider?

Lembit Öpik (Liberal Democrat, Montgomeryshire)

My understanding from our previous debate is that the agency would be able to operate the rocket as long as it was rented. If the rocket were bought, the agency would have to get someone else to look after it. Although I am not asking to do so, if called upon by the nation I would be happy to offer my services and perhaps knock a few asteroids out of the way in the process.

In a more mundane context, I have a simple question about the guidance that the HCA can give

“to such persons as it considers appropriate about any matters relating to its objects.”

Clauses 48 and 49 make it clear that there is a difference between guidance and directions. Although those clauses relate to the Secretary of State, presumably there is some distinction between guidance and directions. Due to my inexperience of my portfolio there may be a standard answer that I do not know, but will the Minister clarify the matter? How binding is the guidance that the HCA gives? Is it mandatory, or is it, within the more conventional meaning of the word, exactly that—guidance and advice? I hope the question makes sense to the Minister, and that he can provide some clarification.

Nick Raynsford (Labour, Greenwich and Woolwich)

My question to the Minister is on a different tack. I assume that the main purpose of clause 43 is to allow the agency to give guidance to providers and others involved in the provision of social housing and regeneration in the way that both the Housing Corporation and English Partnerships do at present.

Within the current arrangements, another area has always been problematic: the relationship between the regulatory function of the Housing Corporation and its investment function. The question has always been how to maintain a proper distinction between those two functions, but without allowing nonsense to develop whereby the investment side puts money into an organisation that is subject to concern from the regulatory side. That will be part of the framework under the new arrangements whereby the regulator will be a different body from the funder and there will at times be questions about whether it is sensible for regulatory action to be taken in respect of an organisation that is seen to be in difficulty.

We know that in general the record over the past 30 years or so has been good in terms of successful housing associations. When problems have arisen, the Housing Corporation has been able to intervene and the problems have generally been overcome without loss of public money or threat to tenants. However, as the recent case involving Ujima housing association highlighted, unhappy circumstances can rapidly develop in which an association that had previously been regarded as a safe recipient of investment finance may seem to be getting into financial difficulties or to be acting not entirely properly in its financial decisions, and regulatory intervention may become necessary. In the Ujima case, questions were asked about whether action was taken early enough when the first warning signals appeared about the organisation not performing as well as it should. My question is: does guidance in clause 43 extend to guidance being issued by the agency to the regulator in such circumstances?

It will be essential to have a clear understanding and a mechanism to ensure the sharing of information between the two bodies, where there are doubts about the performance of individual bodies, and where regulatory action may be necessary. If it is not provided under this part of the Bill, where will arrangements be defined to ensure that there can be a proper and appropriate system for sharing information between the agency and the regulator in such circumstances?

Andrew George (Liberal Democrat, St Ives)

I launched the probing contributions made so far. Indeed my hon. Friend the Member for Montgomeryshire launched a space probe a moment ago. I was not quite sure which planet he was coming from, but I was reassured because in the end it was a very thoughtful contribution.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

You are supposed to be on my side.

Andrew George (Liberal Democrat, St Ives)

Just to reassure my hon. Friend, I fully support him.

Presumably, the HCA will be giving guidance to RSLs and others—local authorities and so forth. Chapter 5 refers to guidance and direction from the Secretary of State. To what extent will the HCA be expected to offer formal guidance to Government agencies, to the Treasury and the Secretary of State? That is not clear, so perhaps the Minister could point out where it is formally provided for in the Bill?

We have noted that the HCA produces an annual report. A lot of bodies that provide housing—RSLs for example—will be making representations to Government, and they would be greatly strengthened if the HCA itself endorsed the concerns of those agencies. An example is the manner in which stamp duty applies to shared equity properties. In many parts of the country when such a property is purchased, the contribution of the occupant is well below stamp duty level but they still have to pay stamp duty because the value of the whole property is above the stamp duty threshold. In those circumstances, and given the fact that it is not open market housing, I hope that the HCA would support social housing providers by endorsing that concern. The Government need to address the anomaly whereby people they and the HCA are attempting to support through low-cost shared equity properties are penalised by having to pay stamp duty. In that instance, it would be appropriate for the HCA to make representations not just to the Secretary of State but to the Treasury itself. Can the Minister reassure us that it would be a right and proper thing for the HCA to do?

Iain Wright (Labour, Hartlepool)

I am grateful to Members for that interesting line of questioning. On the point raised by the hon. Member for Montgomeryshire about whether the word guidance is to be understood in the conventional sense, I reassure him that guidance is guidance.

It might be helpful if I set out what sort of guidance we expect the agency to provide. It could provide guidance on anything relating to its objects and we have discussed at length improving the supply and quality of housing, regeneration and community development. The sort of guidance the agency might issue could be similar to what English Partnerships and the Housing Corporation have been doing. For example, in relation to its investment functions, the Housing Corporation issues a piece of main guidance called the capital funding guide, designed to help registered social landlords understand the procedures and requirements relating to capital grant.

Iain Wright (Labour, Hartlepool)

It is a pleasure to see you back in the Chair this afternoon, Mr. Gale.

I think that this morning I covered adequately the points about guidance raised by hon. Members, and I gave some examples.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

I am grateful for the clarification that the Minister provided. However, one concern remains, to which he could respond now or, if necessary, in writing. Will he provide clarity on the question of whether the guidance is binding or advisory, as it would be useful for the Homes and Communities Agency to know what is expected of it? I am not putting him on the spot: if he wants to consider that question, and respond in writing, or later in Committee proceedings, I am comfortable with that.

Iain Wright (Labour, Hartlepool)

As I think I mentioned this morning, my understanding is that guidance is guidance, and that it is not binding. However, if I have inadvertently misled the Committee, I shall make Members aware of it.

My right hon. Friend the Member for Greenwich and Woolwich made a point about guidance to the regulator. Clause 40, which we agreed this morning, places a duty on the agency to co-operate with the regulator. We expect that to ensure that the two bodies can work together and exchange information where appropriate. A reciprocal arrangement is provided for in clause 102, which places a similar duty on the regulator to co-operate with the agency. I hope that that reassures hon. Members.

Andrew George (Liberal Democrat, St Ives)

In my contribution, I sought clarification on the question of whether guidance could go up from the HCA to the Secretary of State in the manner that I described. That sort of communication is important. The HCA should be free to give such guidance and advice, but that is not made explicit in the Bill.

Iain Wright (Labour, Hartlepool)

I apologise to the hon. Gentleman for not addressing that point. Guidance could certainly be given upwards to the Secretary of State, although it would not be binding, as I said to the hon. Member for Montgomeryshire. However, the free exchange of ideas and opinions will certainly be important to the Secretary of State and the agency. I hope that that reassures the hon. Gentleman.

Clause 47

Nick Raynsford (Labour, Greenwich and Woolwich)

In an earlier debate, I expressed concern about whether the definition of “a project” in clause 47(1) was unduly restrictive. I hoped that the amendments that I tabled at the end of our discussions on Tuesday would be considered today, but I was working on the basis of older procedures under which a one-day notice period was acceptable. I had forgotten that two days are now required, so my amendments were not eligible for selection today. Nevertheless, the issue remains important. I know that we discussed the matter earlier, but my hon. Friend the Minister undertook to consider further whether the tight definition of a project, although important to emphasise the time limit, might be unduly restrictive geographically if a group of projects are part of one initiative. Has he reflected further? We may need to return to the issue if it is not possible to provide satisfactory assurances.

Iain Wright (Labour, Hartlepool)

I am pleased that my right hon. Friend caught your eye, Mr. Gale. I wish to put on record the fact that references to “a project”, which we discussed in an earlier sitting, will not prevent the agency from providing services to a project that is under way in a number of locations across England. In that respect, it is not geographically constrained. Equally, the clause does not mean that the agency can provide support services only to a single project at any one time.

The use of the word “project” is intended to identify circumstances that have a start and end date, between which times the agency has been asked, or has offered, to provide support services in one of the ways identified later in the clause. I hope that that reassures my right hon. Friend.

Clause 50

George Young (Conservative, North West Hampshire)

I believe that you were in the Chair, Mr. Gale, when we discussed clause 10. In that debate, markers were put down for our discussion of clause 50. I refer to column 233 of our proceedings of 15 January. The context of the debate was the disposal of land at less than best price, and the Minister said:

“I will touch upon that in some respects as I answer the amendments, but I suggest that we put a marker down in terms of discussing it further under clause 50.”——[Official Report, Housing and Regeneration Public Bill Committee, 15 January 2008; c. 233.]

As we are now debating clause 50, will the Minister define slightly more clearly than he did in the debate on clause 10 the circumstances of any general consent that the Secretary of State might give the HCA to dispose of land at less than best price? He will recall that the Committee spent some time on that, and there was concern about an over-restrictive approach to such disposal. Will he do what he said he would do, and discuss the matter further now?

Iain Wright (Labour, Hartlepool)

As the right hon. Gentleman said, we had an in-depth discussion on the matter when we debated clause 10, and I undertook to do additional work to reassure hon. Members on clause 50. The point is important, and I was rightly challenged on best consideration and the agency’s wider objects.

Clause 50 empowers the Secretary of State to grant consent to the Homes and Communities Agency when it proposes to exercise powers that are subject to that consent, such as the giving of financial assistance, forming or acquiring companies or—this was the point mentioned under clause 10—the disposal of land for less than best consideration. Consent may be given with or without conditions, and generally or specifically, as circumstances require.

Following our debate on clause 10, I should like to set out in more detail the way in which general consents for the disposal of land at less than best consideration are operated by local authorities, the role of English Partnerships and an indication of the nature of general consents that we plan under clause 50. First, I shall first set out the situation for local authorities. They have sought, and been given, the Secretary of State’s consent to dispose of land at less than best consideration under the Local Government Act 1972 and the Town and Country Planning Act 1990. The most recent guidance on general disposal consents was issued in 2003 under the 1972 Act. It sets out measures whereby local authorities can dispose of land at less than best consideration if the disposal meets a “well being test”, as well as the difference between the open-market value on disposal and circumstances in which its value, subject to conditions imposed by the local authority, is less than £2 million. The provisions have been used by local authorities on several occasions, but as I told the Committee on Tuesday, consent is not required, so we do not hold records of disposals carried out under the general consent.

On disposals above the £2 million level, approximately eight consents are given each year under the Local Government Act 1972 and the Town and Country Planning Act 1990, and I can give the Committee examples to illustrate the point and drive the debate forward. In October 2003, in the London borough of Brent, there was a freehold disposal of land on the Chalkhill estate in Wembley for the purpose of housing. It was disposed to the Metropolitan Housing Trust, and the under-value was £2.04 million. Similarly, in August 2004, Basingstoke and Deane borough council disposed of the freehold of undeveloped land at Foxdown, in Hampshire, to Westbury Homes Ltd; the land was for residential development, and the under-value was £2.5 million.

The point that I made earlier about the wide definition of well-being is not confined to housing. The London borough of Greenwich disposed of the leasehold of a school site in Abbey Wood to St. Paul’s Academy; the land was for a city academy school, and the under-value was £7.39 million. Ipswich borough council disposed of land to University Campus Suffolk for the development of a university campus, and the under-value was £9.32 million. The important point is that there are precedents, and the definition of well-being, as set out under the general consents in the Local Government Act 1972, is incredibly wide. That shows what the agency could do when disposing of land at less than best consideration.

Margaret Moran (Labour, Luton South)

As it was I who asked for the evidence base, I feel compelled to ask my hon. Friend what proportion of all requests those eight consents represent—I guess that they are a tiny number in relation to the number of permissions that were needed or asked for. Given that we are talking about a mix of residential and other permissions, what is the percentage of residential permissions, particularly for social housing purposes?

Iain Wright (Labour, Hartlepool)

My hon. Friend makes an important point, but she will appreciate that I do not have that information to hand. However, I will endeavour to provide it to the Committee as soon as possible. As I said, we are in the dark in some respects, but I will do my best to find out the precise proportion of residential permissions in terms of the general consent above £2 million.

Grant Shapps (Conservative, Welwyn Hatfield)

The Minister mentioned Chalkhill estate in Wembley and a figure of £2 million. I actually stood for election in that estate under the unusual election slogan of “Vote for us on Thursday and we will knock down your house on Friday”. It was a disastrous ’60s estate, and the proposal turned out to be quite popular, as I missed out by 60-odd votes on taking what had previously been a very safe Labour seat. The point, however, is that it took an awfully long time to get housing development in that area going; in fact, it was only many years after that election in 1994 that a project got under way. Is the Minister suggesting that his proposals will make it more or less likely that such projects will take place? As he rightly said, it is a question of getting the right deal and the right valuation in place and of getting the whole thing moving. As I said, it was very complex to get that development going. Does he believe that what is described in the Bill will make that process easier? I am sure that that is an easy question to answer.

Iain Wright (Labour, Hartlepool)

I am intrigued. The hon. Gentleman seems to have a knack and panache for slogans. I do not think that “Vote for me on Thursday and I’ll knock your house down on Friday” is as good as “No way to 10k”, but it is still a good slogan. I think that the hon. Gentleman knows the answer to his question, which is that the whole point of the Homes and Communities Agency is to remove as many barriers as possible and to facilitate, smooth and lubricate the processes. Notwithstanding the statutory planning framework in which it will operate, it will ensure that developments are accelerated as much as possible, that difficulties are analysed quickly and that possible solutions involving partnership with the relevant authorities are introduced as quickly as possible.

Andrew Love (Labour, Edmonton)

My hon. Friend the Minister has reassured us on the question of compliance with the objects of the HCA, and he is right to reassure us about continued well-being and the fact that that provision is widely drawn. May I raise with him an issue that an Opposition Front-Bench spokesman raised yesterday? What would happen if improvements that are needed to an estate resulted in a reduction in the number of housing units? Does the well-being definition that the Minister is considering include such a situation?

Iain Wright (Labour, Hartlepool)

It could well do. I return to the point that I made about referencing to the hon. Member for North-East Bedfordshire with my hat on as Minister with responsibility for housing market renewal. The density of an area, with two-up two-down housing and large tracts of terraced housing, for example, may mean that we need fewer affordable housing units on the site. The circumstances that my hon. Friend mentioned would be entirely reasonable, so I hope that that reassures him.

English Partnerships does not have the general consent to dispose of land at less than best consideration, and if it wanted to do so, it would need to seek the consent of the Secretary of State. We touched on the following issue in clause 10. English Partnerships disposes of land with attached specifications that meet its regeneration objectives through an open-market competition and it then accepts the highest bid. Such specifications may need the consent of the Secretary of State if they include matters of wider public benefit.

Nick Raynsford (Labour, Greenwich and Woolwich)

My hon. Friend has pointed out that English Partnerships does not have the benefit of the general consent, so will he make it absolutely clear to the Committee whether he intends the general consent to apply to the new agency? If so, first, will it specify the categories or circumstances in which the power may be used and, secondly, will a financial limit apply, above which the consent of the Secretary of State will be required?

Iain Wright (Labour, Hartlepool)

As ever, my right hon. Friend focuses on the key point. He is right to point out that English Partnerships does not have the general consent, but we need a step change, a culture change, and it is right that it applies to the agency. The specific circumstances in which the general consent will be made, and the limits on it, will be subject to the tasking framework, but I shall come on to what I think will be the parameters, and perhaps illustrate the type of circumstances to which the general consent will apply. I hope that I have reassured Members about that.

On whether the Bill provides the right framework, I mentioned on Tuesday the Goldilocks principle regarding clauses 10 and 50. It involves providing the right legislative basis to ensure that the new agency can dispose of land at less than best consideration in order to achieve its objectives of improving housing supply and driving forward regeneration, while ensuring that the public purse is as protected as much as possible. I do not think that further amendments are necessary.

We have mentioned today that the Committee has sought reassurance about how, underneath the legislation in the Bill, we will give the agency the framework to deliver the necessary housing and regeneration that all Committee members have emphasised. I have also already said that we are committed to issuing the general consent under clause 50 to enable the agency to act without having to seek the Secretary of State’s consent for every disposal. In response to my right hon. Friend’s point, we need to consult stakeholders about the terms of the general consent. We are examining the local government model, but we must consider whether the levels are appropriate.

Margaret Moran (Labour, Luton South)

I am pleased to hear that the Minister wants to consult more widely on general consent; that is helpful. However, when he does so, and when he considers the local government model, will he remember that we are trying to reach a practical outcome in order to meet the objectives? Currently, the general consent is narrowly defined and administratively onerous. When one looks at the form, which is 36 pages long, one can imagine local government and the HCA being put off from considering such consents. Consequently, the opportunities for social housing from the disposal of land may be missed if the sale goes to a private developer.

Iain Wright (Labour, Hartlepool)

My hon. Friend is spot-on in her analysis. We do not want the procedure to be too onerous, and the point of general consent in many respects is not to have to go to the Secretary of State. If my hon. Friend will allow me, I will give an example of where general consents might be used, because that is pertinent and a good illustration for the Committee. They tend to involve the disposal of land, and the agency might be disposing of many, similar plots of land throughout England. In such circumstances, I do not think it is unreasonable for the Secretary of State to issue a general consent stipulating that so long as the land to be disposed of is worth less than a specified amount, the agency could do so without having to seek separate consent from the Secretary of State on each occasion.

That is important, because there will be a step change in housing supply and quality in England if a local authority or registered housing landlord can use infill when it has a bit of land on an estate or a bit of wasteland that could be used for five, six or seven houses. I am not talking about garden-grabbing, so the Opposition need not get excited, but about pieces of land that might be on estates and could be used for six or seven houses. Going to the Secretary of State to dispose of that land would be onerous in many respects, and I do not think the numbers would stack up if it was at less than best consideration. If we agree a certain amount, which could be £2 million or whatever, I think that would help to free up and accelerate the use of land for infill development—I see hon. Members nodding. I think it would be reasonable for the agency to do that, and it is a reasonable framework in which general consents could be considered by the Secretary of State.

Andrew George (Liberal Democrat, St Ives)

I caution the Minister that the market for land is not an even or homogenous market throughout the country. For example, the price of land in some villages overlooking the sea in Cornwall command very high prices for small levels of development. I want to probe the Minister on the specified consent available to English Partnerships. It is presumably specified that it may dispose of land if that would provide employment on that land. Could the Government extend that in the Bill to the HCA and specify that such land must be used for affordable housing? English Partnerships currently has that general consent to specify that land can be used for employment, so could the principle not be extended to the HCA specifying that the land must be used for affordable housing?

Iain Wright (Labour, Hartlepool)

The hon. Gentleman raises an interesting point and has emphasised the importance of English Partnerships’ work on regeneration throughout our proceedings. That is not unreasonable. We have established the legislative framework in the Bill, and I want to consult on the framework below that for what can happen operationally. His suggestion can certainly be considered. I draw the hon. Gentleman’s attention yet again to the point that I made earlier about the well-being test, which is broadly defined so that it can take account of social, economic, environmental and regeneration objectives. I hope that that satisfies him.

Returning to the hon. Gentleman’s earlier point, I am keen to see the culture change and the step change that the new agency can offer. I want to ensure that we accelerate the supply of housing in England, and this could be a means of doing so. English Partnerships, the Housing Corporation and a number of authorities are already forging ahead with innovative projects such as those that I mentioned, and we want to do everything we can to encourage that in future. I give way to my hon. Friend.

Margaret Moran (Labour, Luton South)

I will give my hon. Friend a breather and reiterate an earlier point. Will he consult on the extreme complexity of the current consent requirements? My point is not just about length: the requirements are extremely technical and I can imagine that both the HCA and local government might be put off by the resources involved in putting them forward to the Secretary of State. That slows down the whole process and risks affecting the speed of development that we are trying to achieve.

Iain Wright (Labour, Hartlepool)

My hon. Friend looked poised to get to her feet, and I apologise if I made her do so, but she makes a good point. I have asked my officials to work with existing bodies and stakeholders to consider this issue and what the terms of consent should be, as well as considering the issue more widely in relation to the opportunities, challenges and barriers to disposal of less than best consideration. Her point about the length and complexity of guidance is a valid one, and I shall ask that that be included.

Grant Shapps (Conservative, Welwyn Hatfield)

We like a lot of what we are hearing. It sounds like good common sense to think about having a limit of £2 million or so. However, we ask that it be future-proofed, so that we do not end up with a figure that has not been uprated. Hon. Members have made similar points about regional differences, and more work probably needs to be done on that, but it sounds as though things are moving in the right direction.

Iain Wright (Labour, Hartlepool)

I thank the hon. Gentleman for his positive comments, and I shall take on board his points. Future-proofing is an important consideration.

I hope that I have reassured the Committee today and with the points that I made on Tuesday about clause 10 and the Goldilocks principle. Clause 10 is not too onerous on the selling of land and is not so flexible that the public are not reassured that they are getting good value for money. It is just right, and that is the right approach to take. We are taking the right approach by introducing clause 10 in conjunction with clause 50 and the framework behind it, which I have explored today, and which hon. Members have probed.

Clause 52

George Young (Conservative, North West Hampshire)

I would like a short debate on this clause, which gives the Secretary of State powers by order to appoint the date of the abolition of the Commission for the New Towns. I thought that it had already been abolished. It is rather like going to the House of Lords and finding that someone whom one thought had died some time ago is still around.

I have a press release from 1995 from the National Audit Office, which states:

“In July 1993 the Secretary of State for the Environment announced his intention to wind-up the Commission itself by the end of March 1998.”

Given that English Partnerships was created in May 1999 as a merger between the commission and the Urban Regeneration Agency, it is unclear to me why the commission has survived. What is it doing? No new towns have been created since 1970 and I think that most were wound up in 1980. I remember going around the country winding them up and meeting local authorities that pleaded to be allowed to go on for even longer, to invest in their areas, although they had all opposed their establishment at the beginning. What assets does the commission have? As I recall, all that it was given were some roundabouts that the original new town had not been able to pass on to the local authority.

Although we are abolishing the commission in clause 52, it is being exhumed in clause 54. Will the Minister tell us why the residuary body that was set up in 1981—I may have had something to do with it myself—is still around? What is it doing and how much has it left to do? When will he finally put the gravestone on top of it?

Iain Wright (Labour, Hartlepool)

The right hon. Gentleman might be disappointed to hear that it is still in operation; it is still technically alive. However, he is correct that all new towns have been wound up. The CNT calls them residuary assets, which were not transferred back to the local authority at that time. He mentioned roundabouts—I imagine that it is that sort of thing. I have not got details to hand, but could provide the Committee with them if it wishes. However, given that the residuary assets will be held by the agency, which will have responsibilities towards them, it will take over the commission’s functions in respect of those assets.

There is always the possibility that the Government will choose to establish new new-town development corporations to help with, for example—

Andrew Love (Labour, Edmonton)

Eco-towns.

Iain Wright (Labour, Hartlepool)

My hon. Friend is quite right—eco-towns. If so, the assets of the new new towns would eventually transfer to the agency. That is the technical explanation, and I hope that it reassures the right hon. Gentleman.

Clause 54

Andrew George (Liberal Democrat, St Ives)

I beg to move amendment No. 36, in clause 54, page 23, line 17, at end insert—

‘(3A) The Secretary of State shall make provision for the continuation of the functions of the Commission for the New Towns in respect of workshops and industrial building, through the transfer of those functions to another authority.’.

Having listened to the debate on clause 52, I feel that my amendment is deficient in some respects. However, I shall use this as an opportunity to probe the Minister, who is aware of my concerns. The clause should be made more explicit to protect the valuable work of English Partnerships, which otherwise could easily be lost or submerged in the clear objectives set out in clause 2. English Partnerships has always supported the provision of employment floor space, which is one of the outputs against which it has been measured since it was established. The agency has progressed specific programmes on, for example, priority sites and network space, designed to deliver employment floor space in areas where the private sector is reluctant to invest.

That key provision could easily be neglected in the Bill. Perhaps unbeknown to some, English Partnerships has developed workshops in communities where no social housing remains—communities in which the HCA might not be interested. None the less, such communities have a need for employment opportunities and the prospect that local businesses could flourish, but the private sector might find that it is not commercially viable or attractive to set up workshops and employment space in such places. In those circumstances, English Partnerships has made a significant difference, and its work should not be overlooked. From the perspective of those concerned about the future of rural areas, it is important that that important work is not lost.

The statutory background to English Partnerships’ support for employment floor space can be found in section 159 of the Leasehold Reform, Housing and Urban Development Act 1993, which sets out the objects of the Urban Regeneration Agency. Section 159(4)(b) states:

“by developing, or encouraging the development of, existing and new industry and commerce”.

I acknowledge that the Bill includes powers to allow the HCA to support existing or new businesses and these are set out in clauses 31 to 33 which were debated earlier. The Bill, in clause 42, would also allow the HCA to provide advice. What concerns me is that in those clauses, particularly clause 33, the provision of work space in the context which I described earlier is not sufficiently explicit. If a list is going to be made then something could easily be overlooked or submerged in the future work of the agency. I urge the Minister, therefore, to look very carefully at this issue and see whether he could bring forward proposals or perhaps work together on a proposed amendment which would allow this to be more explicit.

Targets are set through English Partnerships’ corporate planning process and agreed with Ministers. English Partnerships’ core targets cover housing units and other issues but also employment floor space and private-sector investment attracted. In 2006-97, English Partnerships provided 326,000 sq m of employment floor space which matched well against their target of 300,000 sq m. I do not see anything in the Bill where such a target would be permitted or required of the HCA to ensure that employment floor space of this type is produced and that is why I hope that the Minister will consider carefully the need to make more explicit that important function, which I fear otherwise will be lost and submerged.

Iain Wright (Labour, Hartlepool)

I pay tribute to the hon. Gentleman who has been tenacious in this line of questioning. He has been so throughout the debate, from oral evidence sessions onwards, in a very sincere manner. I suggest that such a provision is not necessary in respect of his concerns because the powers of the agency are already sufficiently wide to provide industrial building or workshops, should the regeneration or sustainability of a community or area warrant such development. I draw his attention to clause 33 which contains the phrases

“encourage or develop existing or new businesses...provide business or employment services”.

Those specifically and sufficiently refer to encouraging or developing the matters to which he alluded.

We are reiterating and rehashing some of the earlier debate but it is important to reassure the hon. Gentleman that, while the focus of the agency may be towards increasing the supply of housing, it is also tasked with ensuring that any housing developed is supported by the necessary infrastructure, which will include the provision of adequate employment facilities for the area in question should it be needed.

I have made the point on a number of occasions that I do not think that plonking 3 million homes in a field will be adequate. We need to ensure there is sufficient infrastructure, and an employment base is essential. The agency may facilitate the provision of these developments rather than develop itself but it has the power to do so which will be important in helping to fulfil its objects.

Andrew George (Liberal Democrat, St Ives)

The Minister used the expression that the provision of housing is supported by other infrastructure. The question that I raised in my opening remarks was that there are some communities where English Partnerships has developed its workshops where no social housing has been provided at the same time. In some villages, social housing has been lost because it has all been sold but English Partnerships still provided those workshops. If the Minister is saying that industrial floor space and workshops will only be provided in circumstances where there is also some housing development, I remain concerned.

Iain Wright (Labour, Hartlepool)

I hope that the hon. Gentleman does not forget about the importance of regional development agencies, the sub-national review and the explicit requirement for local authorities to be involved in economic development. That triumvirate—local authorities, RDAs and the agency—will be essential in reassuring him with regard to the importance of that regeneration of necessary industrial floor space. I hope that he asks leave to withdraw his amendment.

Andrew George (Liberal Democrat, St Ives)

Having listened to what the Minister said, I still seek some further reassurance. I hope that he will take on board the concerns that I have raised, particularly in respect of rural areas, which are not necessarily scheduled to receive social housing of the type that we all want to see across the country in future. However, from a drafting and placing point of view, the issue that I am raising could be more appropriately drafted. I hope that the Minister will take this matter on board and consider the need for a more explicit statement in the Bill to reassure rural areas that these objectives will be met.

I am grateful for the Committee’s patience in allowing me to probe the issue. I am happy to beg to ask leave to withdraw the amendment.

Clause 55

Iain Wright (Labour, Hartlepool)

Let me take this opportunity to update hon. Members on the smooth transition from the existing bodies to the new arrangements. I have to pay tribute to my right hon. Friend the Member for Greenwich and Woolwich, who has been articulate in expressing concerns that the new Homes and Communities Agency should hit the ground running to help achieve the ambitious target of 3 million new homes by 2020. It is pertinent and relevant to update the Committee on where we are with regard to that.

I should like to mention the work that is currently being carried out by the agency’s project board, which will be chaired by Sir Bob Kerslake. The work to date has identified three key work strands that will need to be delivered if the agency is to be established and become operational by April 2009. The first is organisational design and development; the second is the investment plan and finance; and the third is interventions, policy and stakeholders.

I am happy to provide Committee members with copies of a letter that Sir Bob Kerslake has sent to English Partnerships and Housing Corporation staff in the last few days, but I thought that it would reassure them if I cited it. Sir Bob states:

“I am personally delighted to have had confirmation of such an important transfer of delivery functions from CLG, including major new initiatives such as the delivery of the growth areas. This will underline the importance of the HCA as local government’s best delivery partner”—

he uses an important phrase there—

“able to bring together all of the strands of housing and regeneration delivery in powerful packages in support of local authority plans.”

I stressed that myself. With specific reference to the clause, Sir Bob says:

“As I mentioned in my last letter, I am creating a dedicated set up team to oversee the creation of the new Agency. This will be led by Trevor Beattie, currently Corporate Strategy Director of English Partnerships, who will be responsible for a small team of about a dozen headed up by Margaret Allen, currently the Housing Corporation’s Field Director Central, and Ros Dunn, a senior member of CLG who was formerly Director of Strategy for the Thames Gateway.”

I am more than happy to provide Committee members with a copy of Sir Bob’s letter. I hope that it reassures them that work is ongoing and that Sir Bob has hit the ground running in ensuring that the agency starts delivering as soon as possible.

Grant Shapps (Conservative, Welwyn Hatfield)

I am pleased to hear about the interim arrangements and the progress. I represent two new towns, Welwyn Garden City and Hatfield. One of them, Hatfield, has had a new town centre promised for a very long time. It has proved to be a difficult and much-delayed project, the building of which should finally get under way in 2009, or perhaps at the end of 2008. The project falls under the auspices of a partnership between the council and English Partnerships, which will take over from the Commission for the New Towns.

I think that when people learn about the Homes and Communities Agency, they will seek the kind of reassurance that the Minister has been providing, because the last thing they want in a project with a time scale that runs to 2011 or 2012 is to feel that there could be another six months’ or year’s delay while the HCA gets up to speed. I am grateful for the Minister’s comments. They will be important for Hatfield and many other projects around the country.

George Young (Conservative, North West Hampshire)

I may not have accurately caught what the Minister said. On the interim arrangements, the clause states:

“The Secretary of State may...require the Urban Regeneration Agency and the Commission for the New Towns to provide staff, premises...on a temporary basis”,

but not the Housing Corporation. Is there any reason why it is left out of the requirement?

Iain Wright (Labour, Hartlepool)

On the point that the hon. Member for Welwyn Hatfield made about Hatfield town centre, I mentioned earlier the three broad work strands: organisational design and development, investment plan and finance, and intervention policy and stakeholders. Under those three work strands, there are 20 further discrete ones that are intended to ensure that the establishment of the agency does not disrupt the continuing work of the Housing Corporation or English Partnerships, or the delivery functions of the Department for Communities and Local Government. Therefore, in respect of the particular example that the hon. Gentleman, as a good constituency MP, refers to—obviously, it would be better if there were a Labour gain—I hope that I have reassured him that we are moving forward and that there will be as little disruption to current plans as possible.

Nick Raynsford (Labour, Greenwich and Woolwich)

On that very point, I do not know whether inspiration has reached my hon. Friend the Minister, but it strikes me that there is an interesting curiosity in the Bill, in that we have already dealt with clauses 51 and 52, which abolish respectively the Urban Regeneration Agency and the Commission for the New Towns, but we have not yet reached clause 66, which provides for the dissolution of the Housing Corporation. It occurred to me that there may be some logic in making interim arrangements for those bodies that have already been abolished but not yet making such arrangements for the one that is due to be abolished in the next hour or so, if we proceed expeditiously.

Iain Wright (Labour, Hartlepool)

I shall address the two points, which are the same. The Committee will be thrilled to hear that I have tabled new clause 35, which addresses the issue. It states:

“The Secretary of State may by notice require the Housing Corporation to provide staff, premises, facilities or other assistance to—

(a) the regulator, or

(b) the HCA.”

George Young (Conservative, North West Hampshire)

Does that not show the risk of providing a list in a Bill?

Iain Wright (Labour, Hartlepool)

A fair point.

Roger Gale (Conservative, North Thanet)

In case anyone is worried, we shall reach clause 58 with schedule 7 some time on or before 31 January. [ Interruption. ] You have to be sharp on your feet, Mr. Shapps. You will learn.

Clause 60

Roger Gale (Conservative, North Thanet)

Hon. Members will have noticed that amendment No. 134, to clause 67, appears in the wrong place on the amendment paper. It will be reached, but not yet.

New Clause 3

Alistair Burt (Conservative, North East Bedfordshire)

I beg to move, That the clause be read a Second time.

It is not uncommon for attempts to be made to ask a new agency or Government organisation of some significance to lay an annual report to Parliament, to give Members the opportunity to raise matters concerning it and find time for a debate. I am keen on the new clause, even more so following the events of last week.

The purpose behind the new clause is obvious. A number of the debates that we have had have centred around the concern that the agency’s powers will be extensive. As we have said more than once, the sum of the parts will be rather greater than the extent of the individual parts. An agency that combines the power to acquire, deliver and build will be extensive. We have discussed conflicts of interest; guidance on the extensive powers to be given; local authorities’ concerns about the circumstances in which powers might be used to take over their planning functions; compulsory purchase; whether the agency will be driven by the numbers game, and whether it will concentrate fully on wider regeneration issues. All those matters have been raised both in the Committee and by a number of the outside bodies that have been interested in the creation of the new agency and beyond.

On those grounds alone, there is more than good reason for the HCA to produce a report such as we describe in the new clause. I am tempted to think that the Minister will be sympathetic to it, because it is not in his nature to restrict information. From how the matter has been handled on all sides, he will have seen a genuine interest in the agency’s work from Members who, in many instances, have seen things in their own constituencies that will relate to its activities. Many hon. Members have a real interest in both housing and regeneration, and would want the time and attention of the House directed towards those matters. I would have thought that the Minister was sympathetic to and interested in allowing such scrutiny, and that it might just have been missed out. It seems to me that creating such a large body and not providing for an annual report to Parliament is an oversight.

I shall now relate the clause to the written statement last week, in which for the first time we had a chance to see how extensive the agency’s powers would be and what new things it would take from the Department, which the Minister for Housing was able only to hint at when she gave us evidence. She fleshed them out in that statement. We now have an even stronger right to demand that the Bill include a clause requiring the production of a report on the agency’s activities. I do not want my arguments to be too wide, but I can fairly draw attention to two matters in the written statement for which responsibility is to be transferred from the Department to the new agency: housing market renewal and the Thames Gateway.

Currently, if things go wrong with housing market renewal—it has been known—we can question the Minister and the matter is dealt with in Parliament. The transfer to the agency of powers on pathfinder schemes and housing market renewal does not negate the Department’s ultimate responsibility, but the matter will be handled by the agency with its extensive powers. We need a mechanism by which the agency can inform Parliament how such a major project is going. I will not linger on pathfinder, but the recent NAO report on the pathfinder programme said in one of its conclusions:

“There is no guarantee that intervening in the housing market in this way will address the causes rather than the symptoms of the problems experienced in these neighbourhoods.”

It was not a very good report and we are talking about £2.2 billion being spent over five years.

As I am leaving this post—

Iain Wright (Labour, Hartlepool)

No!

Alistair Burt (Conservative, North East Bedfordshire)

Thank you, a great cry. None from my side, but a very strong appeal from the Minister. [Hon. Members: “No, no.”] My hon. Friends’ development is coming on now.

I can put on record my views about pathfinder. I am not wholly negative about the concept. I have seen pathfinder areas. I have been to east Lancashire and seen Max Steinberg’s work up there in very difficult areas such as Nelson and Burnley. My concern about pathfinder has always been that it is a very blunt instrument. The housing market moves very quickly, and I think the NAO report exposed that. I do not think that the Department’s response has been very good. But if the responsibility goes to the agency, what chance will there be for Members of the House to burrow into the issues that concern us, like those exposed by the NAO, and the pathfinder and housing market renewal programme is not showing more signs of being responsive to the housing market and the appropriate changes are not being made?

I am sorry to raise the Thames Gateway again, but I feel I must. I raised it in business questions and Members of the Committee will know how concerned I am about the handling of it. I was not best pleased with the stage at which the written statement was produced, for reasons that we discussed last week. This is a project for which the Department has had responsibility and has recently received very extensive criticism. Three conclusions from the PAC’s report were, first:

“The Department does not know how much the regeneration of the Thames Gateway will cost the taxpayer.”

Secondly:

“The Department has not translated the vision for the programme into comprehensive and measurable objectives, nor are there robust systems to measure progress.”

Thirdly:

“The Department's management of the programme has been weak, and has not demonstrably added value to the programme.”

Those are pretty damning criticisms, but now, conveniently, the whole thing is passed, as a result of the Minister’s written statement, to the Homes and Communities Agency. That seems to me to be a pretty big responsibility on its own, so why not report to Parliament? Why not take the opportunity today of saying, yes, these are big things, we want the agency to be required to report to Parliament, we think by statute, on matters as important as this. It would be sensible to have the report in the terms that we have suggested. If the Minister takes up our suggestion, I suspect that the report will be more extensive. But we are asking specific questions through the new clause.

Andrew Love (Labour, Edmonton)

I have been listening to what the hon. Gentleman has said about the renewal areas and the Thames Gateway. What makes him believe that setting up the HCA will lessen the scrutiny and auditing arrangements that he has talked about that are carried out by the NAO or by those investigating the Thames Gateway? Surely they will continue and if there are problems, they will be exposed.

Alistair Burt (Conservative, North East Bedfordshire)

Yes, there will still be scrutiny by those bodies, but I am troubled by how much attention is then paid to them and how they are brought to light. We have had no response from the Department to the two reports that I have mentioned on pathfinder and the Thames Gateway. There has been neither a written nor an oral statement defending the Department’s position in relation to those. If we want information, it is difficult enough at the moment to get it from a Department that is responsible directly to the House of Commons. How much more difficult might it be to obtain information from an agency? The Minister shakes his head. If he would like to commit to a written statement from his Department about both reports as soon as possible, I would be pleased to hear it. However, the point is that we do not have the opportunity for scrutiny that we would really like now. This afternoon, I asked the Leader of the House for an urgent debate about the Thames Gateway.

The new clause is a belt-and-braces measure, offering a report in particular terms so that we might examine the information brought forward by the agency without requiring the scrutiny of those bodies in order to bring information to the House’s attention. We have not heard much from the Department, and I doubt that we would if those bodies had not been doing their job.

Iain Wright (Labour, Hartlepool)

Housing market renewal is an area for which I have ministerial responsibility, and about which I feel passionately. On the Opposition’s scrutiny of the Government, will the hon. Gentleman tell me how many oral questions the Opposition have tabled on communities and local government and HMR, and how many Adjournment debates his colleagues have requested on HMR? There are mechanisms in place to scrutinise the Executive, and I suggest to him that they have not been used.

Alistair Burt (Conservative, North East Bedfordshire)

That is not entirely fair. I have asked oral questions on the housing market renewal initiative. I remember one exchange with the former Deputy Prime Minister, the right hon. Member for Kingston upon Hull, East (Mr. Prescott), in which the whole issue was swatted away. He said, first, that the Tories did not understand the north of England, and secondly, that we had got it all wrong. Some months later, the fallacy of his position was laid bare for us all to see in the reports.

The response from Ministers was extraordinarily patronising and arrogant, and it turned out to be completely wrong. I am delighted that the hon. Gentleman has responsibility for the issue, because I expect a complete change of attitude in all those respects. The issue was raised, and the concerns were dismissed as scaremongering, which was connected with groups in towns, such as Liverpool, Salford and other parts of the north-west that were making trouble because of demolitions. It was suggested that that was our interest, but it was not. I have gone on record and tried to maintain a balanced opinion about pathfinder, saying that there are reasons for it, but that there are also places in which it is breaking down and not working.

Some of the situations in Liverpool are a scandal. The Financial Secretary to the Treasury, the right hon. Member for Liverpool, Wavertree (Jane Kennedy), at a public inquiry, described some of the practices as social cleansing. My concern that there were problems that needed scrutiny and discussion still stands. There are of course other mechanisms, but I am talking about an opportunity for the HCA to recognise that up to now, the scrutiny has not been as good as it could be. With a balanced approach and an acceptance that some criticism has been valid, it would be good to offer more information to the House in order for the Government to say, “We recognise the things that might have been wrong, and here is a way in which, annually, we can present our view on the issues, so that there is no reliance on people burrowing into information, finding things out and producing them.”

That is why the new clause talks about looking for

“value for money and efficiency...how the HCA is achieving its objects and exercising its powers...how the HCA is co-ordinating and consulting with government departments and other public authorities”.

In both areas of departmental interest that I have mentioned, there have been complaints that such work has not been done effectively. That is my point.

There is nothing to lose; the work will be done. It seems admirable to bring more information to the House rather than less, and I cannot see a good reason against the measure. Already, there is a series of annual reports to Parliament. Some are on massive, world-shaking events such as climate change, some are on constitutionally important issues such as judicial appointments, some are on socially important issues, such as the annual report of the Commission for Social Care Inspection, and some are on rather more obscure issues such as the pharmaceutical price regulation regime. I cannot see that the work of the HCA does not fit somewhere into that spectrum as also requiring a report to be presented to Parliament and I humbly ask the Committee to support the new clause.

Robert Syms (Conservative, Poole)

I support my hon. Friend, who is as eloquent as usual.

If this agency is to do all that the Government say they want it to do, there are some issues about which Parliament is going to have a view. One such issue would be equity. How fairly are the resources of the HCA being spread across England? The hon. Member for St. Ives asked about rural areas and the balance of resources going in. Will the agency be centred on our cities, or will it pay a lot more regard to the real problems of homelessness and the provision of homes facing people in rural areas? So I do think that there are issues on which Members might like to contribute, and I think that that is relevant.

Also—value for money and efficiency was mentioned earlier—one of the issues raised by my right hon. Friend the Member for North-West Hampshire was not only who was going to run the agency, but where it was going to be based. We know that the Housing Corporation is in Tottenham Court road. It is as if we are saying to the agency, “Here is an envelope with £2,300 million to spend on doing the very worthy things that you are going to do”. There may well be an argument that it could be more efficient to put this agency somewhere else, not necessarily in central London—maybe on the outskirts of London.

Iain Wright (Labour, Hartlepool)

Hartlepool?

Robert Syms (Conservative, Poole)

That is the first bid. Denton and Reddish is an excellent place as is Poole or Montgomeryshire. This is of value because the thrust of policy over the past few years has been to try to ensure that there is equitable distribution of public bodies across the UK. Much of the BBC, for example, has moved to Manchester. Therefore, where the agency is based is an issue. Hon. Members might also wish to debate the general issue of how the delivery agency resources are spent across the UK. As with any kind of large scale regeneration scheme, particularly if we get into eco terms, I am sure that there are plenty of Members who will have a view.

New clause 3 may not be the right vehicle, but our point is that there has to be some vehicle for Parliamentary input and scrutiny on what should be a very important organisation for our constituents.

Iain Wright (Labour, Hartlepool)

May I just put on the record how saddened I am to see that the hon. Member for North-East Bedfordshire is moving away from his current post. I think that the whole Committee will agree that his skill and expertise on regeneration is high, and the thoughtfulness and manner in which he projects himself is held in sincere regard.

Andrew Love (Labour, Edmonton)

Can the Committee have a vote on it?

Iain Wright (Labour, Hartlepool)

I absolutely agree. With the greatest respect to his Front-Bench colleagues, the fact that he is leaving the Communities and Local Government team considerably reduces the average in terms of the calibre of the Tory Front Bench. I will miss him because of that. He is a real asset to the Tory Front Bench. I reiterate the point I made last week—he is more than welcome to cross the Floor. He would be most welcome.

Alistair Burt (Conservative, North East Bedfordshire)

I beg your indulgence Mr. Gale. That is extremely sweet of the hon. Gentlemen and I do appreciate his comments. However, I am not sure that I am tall enough to reach the sinking ship quickly enough with my feet if I were to seek to cross the Floor.

Iain Wright (Labour, Hartlepool)

I do not wish to try your patience, Mr. Gale, but I have to say—and this is not something that I can say very often—that I actually think that I am taller than the hon. Gentleman. That is quite a feather in my cap.

Nick Raynsford (Labour, Greenwich and Woolwich)

Many Labour Members are somewhat puzzled by the presence of the apple sitting by the hon. Member for North-East Bedfordshire and are wondering whether a fate akin to that of William Tell’s son awaits him?

Roger Gale (Conservative, North Thanet)

Order. I can help the right hon. Gentleman. The wife of the hon. Member for North-East Bedfordshire is called Eve.

Alistair Burt (Conservative, North East Bedfordshire)

I shall tell her about that.

Iain Wright (Labour, Hartlepool)

Having said all that, I cannot let his comments about housing market renewal and the National Audit Office report go unchallenged. The National Audit Office report says that in pathfinder areas prices have increased faster than comparable areas that did not have housing market renewal initiatives. It has been a success but it has been difficult to quantify. That is entirely understandable, given the massive amount of regeneration that has gone into these areas over the past decade or so—with Sure Start and so on. It is entirely reasonable that that work has gone on.

I have spent the past couple of months visiting these areas. East Lancashire was mentioned earlier, and I am going there on Friday to have a look at Burnley and the Elevate scheme, just to see what needs to be done before I make a decision on the specific allocation of that £1 billion for the next three years. There has been real success in these pathfinder areas. More needs to be done because we are suffering from generations of decline, so I take issue with what was said.

The views of the hon. Member for North-East Bedfordshire (Alistair Burt) are sincere. He gave early warning that he would introduce a new clause dealing with the annual reporting of the agency. I told him at the time that I did not think it was necessary. I feel quite strongly that the reporting requirements in the Bill are perfectly adequate. I draw the Committee’s attention to paragraph 11 to schedule 1, which says:

“(1) For each financial year, the HCA must—

(a) prepare an annual report on how it has exercised its functions during the year, and

(b) send a copy of the report to the Secretary of State within such period as the Secretary of State may direct.

(2) The Secretary of State must lay before Parliament a copy of each report received under sub-paragraph (1).”

There is a real requirement to provide an annual report on how the agency has exercised its functions and to prepare a detailed statement of accounts in respect of that financial year. The Secretary of State must lay both before Parliament and if, for whatever reason, the Secretary of State considers it appropriate, she can require the Homes and Communities Agency to provide any other information she requests about the exercise and its functions.

A short time ago we agreed that clause 49, entitled “Directions by the Secretary of State”, would stand part of the Bill. Again, the Secretary of State can direct what information is required. The new clause sets out a number of specific areas that the report must cover. However, I reiterate that it is quite unnecessary because the strong expectation is that the agency will cover each and every one of those areas in its report without the need to spell them out in the Bill. It is that dreaded principle again. Indeed, specifying particular areas—as the debate we have had about the list principle shows—risks the omission of others.

The provision is deliberately unspecific in order to allow maximum flexibility and to enable the agency to respond to changing circumstances, such as those that have been mentioned—housing market renewal and the Thames Gateway. The detail of what we would expect reports to cover would be set out in the tasking framework for the agency. As I have said before, the tasking framework is an administrative tool that will set out many of Ministers’ expectations regarding the way in which the Homes and Communities Agency will conduct itself.

Although I understand the view of the hon. Member for North-East Bedfordshire and accept that he is sincere, I strongly urge the Committee to agree that the new clause is not necessary and I ask that it be withdrawn.

Alistair Burt (Conservative, North East Bedfordshire)

In view of the reassurances that the hon. Gentleman has given about his intentions for the agency report—that it will cover the matters that we have raised—and the generosity of his remarks and because my mood is very high owing to the very kind reference to my wife made by the chairman and the fact that Bury dispatched Norwich 2-1 in the cup the other night and because I have got a nice apple sitting here, the ley lines coming through the Committee at the moment mean that I shall model this withdrawal on previous withdrawals. I beg to ask leave to withdraw the motion.

New Clause 16

Nick Hurd (Conservative, Ruislip - Northwood)

I beg to move, That the clause be read a Second time.

I am conscious of the fact that my name sits in splendid isolation above new clause 16. I hope in the next few minutes to galvanise some support across the Committee for the need to press the Government to reach a judgment and possibly a decision on a possible risk attached to the Bill’s objective, which my right hon. Friend the Member for North-West Hampshire correctly described as a step change in the output of housing in this country. It poses a fundamental question of values for the Government about the degree to which we are prepared to take risks with public health in meeting that objective. The purpose of the clause is straight forward; to impose a duty on the Homes and Communities Agency to consider the risks to health arising from what are known as extremely low frequency electromagnetic fields when carrying out its functions, particularly in respect of the location and development of housing. I do not know how many scientists or engineers are on the Committee, but I needed some help in defining electromagnetic fields. In the cross-party inquiry into childhood leukaemia and extremely low frequency electromagnetic fields published in July 2007 on which I had the pleasure of serving they are

“electric fields and magnetic fields are created by the generation and transmission of electricity. The term EMF is used to describe the mixture of these fields to which people are exposed. Major sources of EMF in our environment include High-Voltage Overhead Transmission Lines”

and

“electricity sub-stations”.

The thorny problem facing us and the Government arises from growing evidence of an association—I use that word very carefully for the Minister—between an increased risk of childhood leukaemia and the location of homes and, while we are about it, schools. The Committee should be aware that childhood leukaemia is now the most common childhood cancer, accounting for a third of all childhood cancer cases. Around 500 children are diagnosed every year and, although survival rates have improved, the incidence has been increasing; indeed, it doubled between the 1970s and the 1990s. So, it is a big deal. As we pointed out in the inquiry, there maybe many factors causing childhood leukaemia, we do not know enough. The inquiry chairman, the hon. Member for Dartford (Dr. Stoate), who, as the House is aware, is a practising GP, states:

“Current scientific thinking is that childhood leukaemia is likely to have more than one cause and there may be many factors in the development of the disease.”

As I will point out, there is growing evidence for an association and therefore, we should be very careful about the risks associated with pylons. I will set out the key milestones in the accumulation of evidence. In 2004 the Health Protection Agency recommended that the Government

“consider the need for further precautionary measures to reduce public exposure to EMF”.

In 2005, the groundbreaking Draper report, of which the Minister will be aware, funded by the Department of Health found that children living within 200 m of high-voltage power lines from birth, had a 69 per cent. increased risk of developing leukaemia in childhood. That is a very big number. In response to the Health Protection Agency, the Department of Health set up the Stakeholder Advisory Group on Extremely Low Frequency Electromagnetic Fields—SAGE—in 2005 to make recommendations to Government on practical precautionary measures to reduce public EMF exposure from sources such as high-voltage power lines. It published its first interim assessment in April 2007. It identified a ban on building new homes and schools within specified distances of power lines as the

“best available option for obtaining significant exposure”

from power lines. SAGE was followed by the cross-party inquiry, on which I served, into childhood leukaemia and the association with extremely low-frequency EMF—defined as electromagnetic fields with a frequency of between 30 and 300 Hz, which is the rate specified in the clause that I have moved today. The inquiry also recommended a moratorium on building new homes and schools within specified distances of these transmission lines. In 2007 the Government referred the SAGE report back to the Health Protection Agency for guidance. The HPA has issued guidance on the report and our inquiry, stating that there are a number of epidemiological studies showing an association between living close to high-voltage power lines and a small excess of childhood leukaemia. The Health Protection Agency recommended that the attention of local authority planning departments and the electricity companies be drawn to the evidence for a possible small increase in childhood leukaemia that may result from siting new buildings very close to power lines.

There is a steady development of evidence and recommendations have been put before the Government, which they are now mulling over. The Minister of State, Department of Health, the right hon. Member for Bristol, South (Dawn Primarolo), who deals with public health, is on the record as saying that her Department will consider the advice in consultation with other Departments, the devolved Administrations and the HPA.

The Minister here today, in response to Children with Leukaemia, wrote saying,

“This issue obviously needs serious thought and we will be in touch with you once we have shaped our thinking in the light of all the advice that has now emerged.”

I am aware that this is a highly complicated and thorny issue with implications for some of the policy responses to the recommendations, not least in terms of the implications for land values. I am aware of that because we addressed those matters in our inquiry.

The Bill provides an opportunity for adopting in a robust and real way the precautionary principle. If the Minister has any doubt about the popular support for that, I refer him to a series of early-day motions tabled in this Parliament: early-day motion 403, which refers to concern about the increase of leukaemia related to proximity to power lines, was signed by 233 Members of Parliament and early-day motion 1784 was signed by 146 MPs.

We spent some time in our inquiry gauging public opinion on this matter, with the help of the Children with Leukaemia charity. A survey from Opinion Leader research showed that three out of five people surveyed were concerned about the effects of electromagnetic fields on health and three out of four people surveyed thought that preventive action should be taken to protect children from EMF exposure.

I urge the Minister to be bold. I know that he is a sensitive man: he and I carved exotic animals out of blocks of ice one afternoon recently. Sensitivity is not enough at this stage. In the face of growing evidence, we need to take this issue seriously. It is time for the Government to take a view and communicate it. The simple question is, do the Government acknowledge the risk and, if so, why should we take any?

Alistair Burt (Conservative, North East Bedfordshire)

I should like to put on the record the Conservative Front Bench’s support in respect of the issues so ably raised by my hon. Friend the Member for Ruislip-Northwood. I pay tribute to him and to his colleagues from all parties for their work on this delicate subject.

It is an odd phenomenon. I suspect that quite a lot of MPs have had the odd occasion in their constituency when something has been raised with them that has led to queries about the safety of exposure to EMFs. That is demonstrated by the breadth of cross-party support for the early-day motions. In supporting my hon. Friend, I accept that there seems to be some substance to this matter, and that it is sensible to take action now to try to ensure that nothing new is done that would add to the number of children who have been affected. I appreciate that, again, we are getting into lists and picking out specific examples, but the Minister is interested in the matter and we want to see how far he could go.

I am interested in the block of ice business in which my hon. Friend and the Minister were involved. That seems like a modern management development tool that I have not yet cottoned on to—perhaps it is something that I can introduce in my new role to see how it helps my colleagues to develop. Perhaps the Minister could tell me more later. However, this is a serious amendment that deals with a serious subject for the families concerned. I hope that the Minister can respond in some way to the matters raised by my hon. Friend.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

It would not be reasonable to expect the Minister to become an expert on electromagnetic fields, given that his portfolio is housing. However, this is an interesting debate and I hope that I will remain in order, Mr. Gale, if I highlight a couple of thoughts. I have looked at this research myself. I come from a scientific background and my father was a physicist. There is no question but that when dealing with energy, there can be unintended consequences on health, as intimated by the hon. Member for Ruislip-Northwood. It is perfectly plausible to draw an association between radiation and health, so it is reasonable to obtain the Minister’s perspective on how the Government perceive the precautionary principle in relation to radiation sources. We have probably all had some dialogue with individuals who are concerned about mobile phone masts. Indeed, I participated in a conference in this very room on that subject some time ago.

I have looked at a lot of the research on this matter, and I think that much of it is equivocal and circumstantial. One highly publicised research report seemed to be based on a very small sample, and I wondered whether the sample was sufficiently significant to provide reliable results. Nevertheless, if there is not sufficient evidence, it is incumbent on the Government to research the matter further. Will the Minister give us his views on something that I have long regarded as the most sensible way forward on this and other health-related housing and accommodation matters? If we tabulated health data on a geographical basis, we could see whether regular patterns are developing around the country, perhaps around certain industrial sectors or concentrations of radiation sources. That would greatly help us to build a more reliable understanding of the causal links between such relatively new technologies and the human body.

Obviously, there are risks to certain industries. If they were shown to be significant polluters of health, the consequences would be very expensive. Notwithstanding that, strides in technology have been so great that we have probably wandered into a technological environment in which there are unintended consequences on human health that we are only beginning to understand. Will the Minister consider the case for a geographical tabulation of illness around the country? If so, perhaps we can discuss this issue further.

Iain Wright (Labour, Hartlepool)

I commend the hon. Gentlemen who have spoken to the new clause on the manner in which they did so. They spoke with sensitivity, which is to be expected from members of such a high-calibre Committee. I pay tribute particularly to the hon. Member for Ruislip-Northwood. I know that he is interested in this issue and that, as he said, he participated in the cross-party inquiry into childhood leukaemia and extremely low frequency electric and magnetic fields. I think he said that the inquiry reported last July and made a number of recommendations. I thank him and the other members of the inquiry team for their work, which has made an important contribution to the debate on exposure to electric and magnetic fields.

The frequencies to which the amendment relates are known as extremely low frequency electric and magnetic fields. For ease, I shall refer to them as ELFEMFs. The main sources of those fields are power lines, electricity substations, household wiring and electrical appliances around the home. Let me be blunt about my approach to the new clause. I do not believe that the proposed duty on the HCA is necessary or appropriate, as there are already guidelines on the exposure of people to ELFEMFs. The Government are considering the need for additional practical precautionary measures beyond the adoption of the guidelines. Any precautionary measures that are deemed necessary will be implemented at a national level. That is a crucial point. As such, a duty does not need to be placed on the HCA.

It might help hon. Members to understand the matter better if I set out the current framework for limiting exposure to ELFEMFs. Hon. Members may be aware that the Government take advice from the Health Protection Agency on limiting exposure to ELFEMFs. In 2004, following a comprehensive review of the available scientific evidence, to which the hon. Member for Ruislip-Northwood alluded, the then National Radiological Protection Board, which is now part of the Health Protection Agency, recommended the adoption of guidelines set out by the International Commission on Non-Ionizing Radiation Protection.

Those guidelines, known as the ICNIRP guidelines, are based on the established health effects of exposure to ELFEMF, and set values for workers, building in a significant level of protection. The guidelines for public exposure to power frequency magnetic fields incorporate a further five-fold safety margin from those for workers in recognition of the fact that the general population includes individuals who may be more sensitive to adverse health effects than the working population. However, as the hon. Member for Ruislip-Northwood eloquently said, there are uncertainties associated with the health effects of exposure below the guidelines, and in view of those uncertainties, the HPA also recommended that the Government should consider the need for further precautionary measures in respect of exposure to ELFEMFs.

In response to that recommendation, the stakeholder advisory group on ELFEMFs—SAGE—was established. It brought together a range of stakeholders, including academics, electricity industry representatives and pressure groups, with a remit to identify and explore the implications for a precautionary approach, and to make practical recommendations for precautionary measures. SAGE reported in April 2007, and made a number of important recommendations on power lines, property, and wiring and electricity in homes.

Perhaps one of the most pertinent recommendations to the Government’s housing delivery agenda was the option that an effective way significantly to reduce exposure to ELFEMFs was to introduce a moratorium on the building of new homes and schools within at least 60 m of high-voltage overhead lines, and on the building of new high-voltage lines within 60 m of existing homes and schools. That is known as the corridor approach.

SAGE undertook a cost-benefit analysis of the proposal, and found that such an approach would not pass a cost-benefit test by conventional Treasury book rules. For that reason, SAGE could not recommend that approach, but presented it merely as an option for consideration. SAGE asked the Government to make a clear decision on whether to implement the option and, further to its report, a cross-party inquiry, of which the hon. Member for Ruislip-Northwood was a member, specifically recommended that that option should be implemented. On receipt of the SAGE report, the Government sought the advice of the HPA on the recommendations. In November 2007, the HPA responded to SAGE’s report. A key statement in that response was:

“HPA supports precautionary measures that have a convincing evidence base to show that they will be successful in reducing exposure, are effective in providing reassurance to the public, and where the overall benefits outweigh the fiscal and social costs”.

The HPA also noted that the corridor option considered by SAGE for separating new dwellings from high-voltage power lines and vice versa, is not supported by the cost-benefit analysis, even assuming a causal link between exposure to ELFEMFs and childhood leukaemia, so a decision to implement that precautionary option should, frankly, be weighed against other health benefits obtainable from the same resources. Nevertheless, HPA recommends that within the existing Government planning framework, the attention of local authority planning departments and the electricity companies should be drawn to the evidence for a possible small increase in childhood leukaemia that may result from siting new buildings very close to existing buildings.

The Committee will recognise that the issue of exposure to ELFEMFs, which we are considering, is vital. Hon. Members can be assured that we are carefully considering HPA’s advice on the recommendations in the SAGE report in conjunction with other Departments and the devolved Administrations.

Nick Hurd (Conservative, Ruislip - Northwood)

I thank the Minster for an extremely thorough response. Could I draw him a little on when he expects the Government to publish their response to the advice that they have received?

Iain Wright (Labour, Hartlepool)

We expect to respond to the SAGE report, including setting out any practical precautionary measures which we think are justified.

I have ministerial responsibility for this and, as a father, I think it a vital and important issue. I want to do all I can to make sure that it is addressed and that sensible recommendations are implemented. I give the House, and in particular the hon. Gentleman, my reassurances—as set out in a letter to the Children with Leukaemia organisation on 7 January—that I will do my very best to make sure that this issue is addressed. I am consulting with Government Departments and ministerial colleagues to ensure that we consider this fully.

I do not want to provide a knee-jerk response. As the hon. Gentleman said, this is new and emerging data with regard to relatively new and emerging scientific evidence and industries. I want to mitigate as much as possible the risks and concerns about this.

I hope I have given a thorough response, Mr. Gale. I hope that I have reassured the hon. Member for Ruislip-Northwood, who made his argument in the most articulate and sensitive manner.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

I do not seek to commit the Government through this Minister to my suggestions—I say that for the record—but I ask him to express his opinion whether there is merit in considering the formal tabulation of health data on a geographical basis, for the reasons that I gave before.

Iain Wright (Labour, Hartlepool)

Let me put that direct question to ministerial colleagues, in particular Ministers from the Department of Health, in my discussions with them. I will certainly keep them informed.

I would be happy to meet the hon. Member for Ruislip-Northwood on a regular basis to keep him informed because I know that he sincerely holds these views. I want to keep him fully aware of what the Government are thinking on this. I am very keen to move forward in a sensitive manner and not to make a knee-jerk response. I hope he respects that.

I do not think it is appropriate to place a duty on the HCA since it will be subject to the same statutory controls, regulatory frameworks or guidance concerning ELFEMFs as any other body. On that basis, with the greatest sympathy for what the hon. Gentleman is saying, I hope that he will consider withdrawing this amendment.

Nick Hurd (Conservative, Ruislip - Northwood)

My intention in tabling this new clause was to throw a spotlight on the issue and to try to tease out of the Government a sense of how seriously they are taking it and what they are preparing to do.

We have heard a very sincere and personal response from the Minister. Like he, I am a father and my value system tells me that we should not be taking any risk in this situation. That is my interpretation of the precautionary principle. I am also extremely clear about the complications, costs and consequences of some of the precautionary measures that are being proposed.

I take at face value his personal commitment to moving this agenda forward within the Government. I also hear what he said about needing to address the matter through a national strategy. On the basis of what I have heard, I am prepared to accept the argument for withdrawing the new clause. I beg to ask leave to withdraw the motion.

Clause 242

Grant Shapps (Conservative, Welwyn Hatfield)

Thank you, Mr. Gale. We can broadly welcome sustainability certificates, although we will be interested to see how they work. There is a lot of detail in clause 242 and subsequent clauses about how these certificates should operate. The Government should be wary, following their experience of introducing another kind of certificate in the form of HIPs. I know that the experience will be a scar borne by the Minister and his right hon. Friend the Minister for Housing for years to come.

The certificates do not appear to have a cost or even an estimated cost attached to it. I imagine that that is because it would vary widely depending on the kind of new home. The scope of the sustainability certificate—I do not want to stray into clause 243—is quite broad. There is a long list of different areas that it may cover.

I want to pick the Minister up on clause 242(8) and the unusual drafting language. It says:

“The seller is not required to comply with a requirement imposed by virtue of this section if the seller has a reasonable excuse for not complying with the requirement.”

I wonder whether the Minister could clarify—I congratulate the drafters for not writing this in gobbledegook—what a reasonable excuse would entail?

Lembit Öpik (Liberal Democrat, Montgomeryshire)

I share one of the concerns that we have just heard, and it relates to certificates as a whole. The certificates represent a comprehensive effort by the Government to enshrine sustainability considerations in the housing market. It is worth remembering that the overwhelming majority of property that will accommodate the British population in 2050 has already been built. As such, our real challenge is not to ensure that new housing stock is sustainable, although that of course is important, but to bring existing stock up to sustainability standards. This can be done at a high price today, but hopefully at a much lower price in the future. My worry is whether a certificate will really do what the Government want it to do.

I am slightly confused, for example, by the wording of clause 242. It seems to require compulsion, but also to allow mitigating circumstances. It makes me believe that those people who have a good story to tell about their houses will get a sustainability certificate, and the owners of those houses which leak energy like a sieve will probably not seek such a certificate.

I have two questions, therefore, for the Minister. First, how can we be sure that the sustainability certificates will not be self-selected by those who want to talk positively about their sustainable house and that there will be no compulsion for those with less sustainable houses to come clean about that. Secondly, how confident can we be that these certificates will make a positive impact, given that the home information packs have everything apart from solid data behind them to prove their efficacy for the housing market and for a potential purchaser?

Iain Wright (Labour, Hartlepool)

This is an important part of the Bill. We have spent a lot of time in Committee talking about more homes and better designed homes. This part of the Bill talks about greener homes, and is absolutely essential to achieve the world-beating ambition that my right hon. Friend the Minister for Housing has set the industry of making sure that all homes built after 2016 are zero carbon. It is an important point. As the hon. Member for Montgomeryshire said, we do need to address the fact that homes “leak energy” because—as I have pointed out to the Committee already—27 per cent of all of the UK’s carbon emissions come from domestic dwellings, and we need to address that.

We need to look at this in the round, and the measures that we are introducing to improve the sustainability of new homes will include a major progressive tightening of the energy-efficiency standards in building regulations. This will mean a 25 per cent. improvement against current standards in 2010, followed by a 4 per cent. improvement in 2013 and then, in 2016, the zero carbon target that I mentioned earlier will be introduced.

This will improve the energy efficiency of both the fabric of homes and of the type of energy supplied. In December last year, we published a new planning policy statement on climate change. It puts climate change at the very heart of the planning system by ensuring that new communities are located and designed in a way that reduces the need for travel and makes best use of low-carbon and renewable energy. In addition, since October 2007, a stamp duty land tax exemption for zero carbon homes has been in place, so that houses can act as an incentive for developers to build zero carbon homes. We will also shortly introduce new minimum standards in building regulations to make new homes more water-efficient.

Clause 242 allows the Government to make regulations to ensure that anybody building a new home has very clear information on the sustainability of that new home. This will be in the form of either a sustainability certificate showing that the home meets higher sustainable standards than a home that has been built to minimum regulatory standards in building regulations, or a written statement that the home does not have a sustainability certificate. These certificates or statements must be provided free of charge to the home buyer. It is important that we are making sustainability assessments, and I stress the word “assessments”, mandatory for all new homes. We are making the provision of clear, transparent information on sustainability mandatory and this can include statements of non-assessment, which are self declarations and do not involve employing an assessor.

In England, it is proposed that the sustainability rating system will be the code for sustainable homes. This code was introduced in April 2007 and is an assessment and rating system that provides a framework within which house builders can improve the overall sustainability of new-build homes. The Code provides a mechanism by which builders can be recognised for going beyond the building regulations for energy and other aspects of sustainability.

The lack of credible information on the sustainability of new homes is limiting our efforts to encourage the market to provide more sustainable homes. Home buyers currently have limited information on the environmental performance and wider sustainability of new homes. I strongly believe that this clause will ensure that information is available on all new homes to allow purchasers to make informed choices.

George Young (Conservative, North West Hampshire)

As I understand it, this only applies when the property is sold for the first time. If I buy a property from somebody who bought it when it was new, do I also get the sustainability certificate, or has it dropped out of the equation once the first transaction has been completed?

Iain Wright (Labour, Hartlepool)

This rating for new homes is a snapshot in time. The right hon. Gentleman might purchase a new property and make changes, put a new bathroom in, or whatever. If he goes on and sells it, the environmental impact on his home would be captured in the energy performance certificate as part of the home information pack.

George Young (Conservative, North West Hampshire)

I may not know whether or not that property had a sustainability certificate when it was built.

Iain Wright (Labour, Hartlepool)

I am sorry, I did not quite catch that.

George Young (Conservative, North West Hampshire)

If I buy the property from somebody who bought it as new, I may not know whether that property had a sustainability certificate when it was built or not.

Iain Wright (Labour, Hartlepool)

I imagine that the rating would be part of the selling pack. It could be that the house had a code rating 3, for example.

Can I clarify one thing? I have been passed inspiration. I want to make something clear, in case I have misled the Committee. We are not making assessments mandatory, we are making rating mandatory. There could be a statement of non-assessment where the property has not been given a rating. I hope that that is clear.

Before I go on, I would like to make a point that links in with the HIPs issue, which I have debated on many occasions with the right hon. Gentleman. Information for purchasers of new properties is absolutely vital to drive up environmental standards. I draw the attention of Members to fridge ratings. The market moved considerably when easy-to-understand ratings for fridges and other electrical appliances were provided. Everyone is very clear about what a fridge rating A means and what a fridge rating C means and it is rare these days, because the industry has responded to the system, to see a fridge rating E or whatever. I think that the market will respond to the fact we are making sustainability ratings for houses mandatory in a very positive manner.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

What I am concerned about—the Minister’s inspiration has reinforced my concern—is the schizophrenic nature of this clause. He is saying that every new property must have a rating, but it is not compulsory to have an assessment. I do not understand how one can have a rating without an assessment.

Iain Wright (Labour, Hartlepool)

That would be a zero rating. I will give him an example. A buyer is choosing between two flats—one with a code certificate, showing a rating of, say, one, six or five stars; the other with a statement of non-assessment, which would be a zero star certificate under the code. That buyer will be able to see—this is the point that I was making about refrigerators—that they are choosing between a sustainable home that is more economical to run, and will reduce their impact on the environment, and a home that was probably built, as that zero star certificate indicates, to minimum regulatory standards.

There will be a big push towards sustainability assessments, because they will enable that home buyer to make an informed choice and we hope that they will choose a home that will have a minimum long-term impact on the environment and—probably more pertinent to them—on their wallet. There are also benefits from other sustainability improvements that will be put into the code.

Grant Shapps (Conservative, Welwyn Hatfield)

We are all in agreement about the need to do these things. At the same time, hon. Members on both sides of the House recognise the necessity not to make things overly bureaucratic and the balance may be there in clause 242. However, there is some concern in the industry. I note that the Home Builders Federation has said that there is scope for duplication between energy performance certificates and the sustainability certificate. The federation is concerned about whether there will be sufficient numbers of assessors to implement the certificates, although I imagine that that is not a huge problem at this stage, as the measure will come in over a period of time as new homes are built. But the National Housing Federation is calling for a

“sensible integration of the EPC and the Code rating.”

Again, it is difficult to see how that could be achieved, given that one is a 1 to 6 rating and the other is an A to F. It could be confusing to a potential purchaser, who might have a sustainability rating of 4 but an energy rating of E. How would they determine which one to follow?

Iain Wright (Labour, Hartlepool)

I understand the hon. Gentleman’s point, but the approach in the legislation was developed in close consultation with the industry. For example, it is possible—and this is something that we raised in spring and summer—that there would be a need for a rating of zero, and an assessor would have to go out and provide a zero-rated assessment on the property. We listened to the industry, which said that such a requirement would entail a disproportionate amount of cost and effort, so it was not necessary. That is why it is possible to have a self-assessed zero certificate, which reduces costs. Listening to stakeholders and the relevant industry bodies has paid dividends, as we will see much greater synthesis of EPCs and the code in future. However, I do not want to pre-empt anything regarding future-proofing.

It is important to point out that we listened closely to the industry, which raised concerns about costs. However, it is very much up for the initiative, which is a means of achieving our ambitious target of making sure that we have zero-carbon homes by 2016. We want to make sure that we make as much progress as possible on improved sustainability and minimising environmental damage, while addressing the industry’s very real concerns about costs.

Nick Hurd (Conservative, Ruislip - Northwood)

I fully support the emphasis that the Government have placed on higher energy efficiency standards for new homes. However, I also back the concerns that my hon. Friend the Member for Welwyn Hatfield expressed about the clarity of message to the consumer, who is bombarded with messages on climate change. The psychology of their reaction to such messages is now at quite a delicate stage. The Minister spoke about the evolution and integration of the two measures. Would it not be better to get it right now, and give just one simple certificate and one simple message to the marketplace about properties’ sustainability and energy efficiency?

Iain Wright (Labour, Hartlepool)

In a perfect world, it would be great to be able to do so, but the certificates assess the sustainability of new build. That is important, because we cannot compare apples with pears. The nature of the code is based predominately on new build, which could be construction or off-site construction that is later brought to site. EPCs and such things do not take that into account because they deal with existing homes. As we move forward and more research is done, we may be able to achieve greater synthesis. I am sure that the whole House would accept that. In the meantime, new build and existing properties must be dealt with separately if we are to address concerns about how we calculate their impact on the environment. I hope that that answers the questions of the hon. Members for Ruislip-Northwood, Welwyn Hatfield, and Montgomeryshire.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

It is important to probe the Government on the measure. I understand what the Minister is saying, but I remain concerned that the Government have put together something that, in reality, will be bureaucratic for the general public. Most people do not buy houses very often, and they already have to deal with the complexities of the home information packs. Why do the Government not seek a more user-friendly approach consistent with, for example, the A to F-rating on white goods? It does not matter how efficient a house is, it is the absolute energy usage which determines how much carbon it produces. We do not need to say, “It is a huge house, but it is efficient”. We simply need to know how much energy it uses in relative terms. Could the Government consider before the Bill’s Report stage whether it is possible to simplify the measure, as it could end up a quagmire?

Iain Wright (Labour, Hartlepool)

I am always happy to consider matters raised by the hon. Gentleman and other Committee Members. There may be a communication issue; the code is very clear about the sustainability rating, which ranges from one to six. One star means that a building has just achieved code standards, and six stars are the highest possible rating. People will acknowledge and appreciate the fact that, as in the star rating for fridges, if they buy a six-star home they are acquiring cutting-edge technology and an exemplar in sustainability. “Six stars are the best you can get” is a very simple message. I accept that there is an issue communicating that, but we can do it.

Grant Shapps (Conservative, Welwyn Hatfield)

That creates confusion in the consumer’s mind. The code and the EPC are almost working in opposite ways. Under the code, six stars are the best result, whereas with an EPC, one wants to go the other way, towards an A, to be excellent. Is confusion not built into the system?

Iain Wright (Labour, Hartlepool)

No, I disagree completely. If hon. Members talked to any normal people—I do so frequently, although not in the House—and asked them what an A meant, or what a star meant, they would know that an A or a six-star rating, as opposed to four, three or two stars, was a good thing. The hon. Gentleman would accept that that is the case: it is not confusing, as it taps into the mindset of what consumers think anyway. When people do GCSEs and A-levels and attain A-grades, it is considered a good thing, so I do not think that there is any difficulty with the measure.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

That was probably a useful exchange, as it clarified which, in my view, was not clear. If the Minister thinks that a six-star rating is as clear as an A, why not call it an A? People would understand it. They have got used to such a rating with white goods, and it would create a consistent message. However clever I pretend to be, I am sure that I would be confused if one thing says “six stars” , which is a lot, and something else says, “A”, which does not sound like a lot. There is a simple solution and I hope that the Government make a small housekeeping change to create consistency in what they are trying to achieve.

Iain Wright (Labour, Hartlepool)

I am sympathetic to what the hon. Gentleman is saying, but a six-star rating is higher than an A-rating under the EPC. However, I concede that an important point has been made, and I will look at it. The challenge is communicating the difference to consumers, and making sure that they are fully aware of how the ratings work. May I emphasise that the central point, which is that consumers tend to believe that an EPC A-rating is generally a good thing, and that an F or G-rating is generally a bad thing. As for the ratings for new homes, one star is not particularly good, and six stars is the best one can get. In that respect, I do not think there is any confusion, but I concede that we may need to do further work on consumer behaviour. None the less, I maintain strongly that the arrangement should remain.

Nick Raynsford (Labour, Greenwich and Woolwich)

May I support the Minister in saying that we are dealing with a huge spectrum of housing? In the existing housing stock, a substantial proportion of houses is sadly in poor condition, and necessary but elementary improvements would only bring them to a low level in comparison with what has been achieved with new housing. For the best house builders, achieving code level 6 by 2016 is highly ambitious.

As for the timetable, I understand that clause 242 will be introduced at a time of the Government’s deciding—I cannot see a date in the Bill. How do the Government intend to plan the introduction of the provisions to coincide with the ratcheting-up of standards between now and 2016, and specifically the achievement of code levels 3 and 4? I imagine that that would be within the time scale that the Government envisage for implementation, and I would be grateful for guidance on the timetable.

Iain Wright (Labour, Hartlepool)

We will continue to consider the timetable for implementation. It is important that we continue to talk to the industry about the matter to ensure that we hit those targets. The targets for 2010, 2013 and 2016 were devised in full consultation with the industry, and the industry is up for them. It has set itself ambitious targets, and we want to ensure that they are achieved. We will continue to work closely with the industry to ensure that that is the case.

Nick Raynsford (Labour, Greenwich and Woolwich)

Although some of industry leaders are definitely up for it—there is no question about that, and the HBF is supportive—some parts of the industry are dragging their feet. They are not committed, and would be only too happy to have an opportunity to renege on the commitments given on their behalf by industry leaders. It is terribly important that the Government give a clear indication of the commitment and the time scale for achieving it so as to allow those who are reluctant little or no opportunity for backsliding.

Iain Wright (Labour, Hartlepool)

That is an important point. By giving the market much more certainty over the direction of travel and what we need to achieve with zero-carbon homes, developers, manufacturers and others can make the investment decisions necessary for the industry to adapt to the changing regulatory environment that will result from improvements to building regulations and other measures. As a result of the measures in the Bill, particularly chapter 1, the industry can make those investment decisions now. However, I fully take on board what my right hon. Friend said about providing certainty.

By applying technical guidance in the code, people will have a better idea of how to attain improved energy efficiency. The provisions underline our serious intent to make zero-carbon performance a building regulation requirement from 2016. The clause allows regulations to be made to ensure that a sustainability certificate or a statement of non-assessment is given to everyone who buys a new home, whether off plan, or after the home is completed or newly constructed. People given an interim certificate when buying off plan will be guaranteed a final post-construction certificate confirming that what was designed was indeed built.

The Homes and Communities Agency will continue the commitment of the Housing Corporation and English Partnerships to build homes to code level 3. Houses built to that code will be 25 per cent. more energy-efficient than those required under the 2006 building regulations. A typical flat built to those standards will reduce carbon emissions by 450 kg a year. I believe that I said on Second Reading that that is equivalent to emissions over 1,500 miles from an average motor vehicle.

On devolved functions, the Minister for Environment, Sustainability and Housing in the Welsh Assembly Government, recently announced the adoption of the code for sustainable homes for Assembly Government-funded social housing, although the level has yet to be determined. Regulations to introduce a certification scheme for Wales will be the subject of consultation when the Bill is introduced. The hon. Member for Welwyn Hatfield made a good point about clause 242(8), which refers to “reasonable excuse”. His argument was well reasoned, but it is impossible to foresee every possible circumstance in which a duty holder might be prevented from fulfilling the duty to provide a sustainability certificate or a statement to the effect that there is no certificate. Any excuse offered to an enforcing authority during a review of a penalty charge notice, or on appeal following confirmation of a notice after such a review, is to be judged objectively, in view of what is reasonable in the individual circumstances and given the background to the case. I am sorry that I cannot provide the further clarification that the hon. Gentleman desires, but I hope that I have reassured him.

Grant Shapps (Conservative, Welwyn Hatfield)

The Minister has done so, and I thank him for his explanation. I commend the draftsmen on the very sensible and clear language in the Bill. However, I remain slightly confused about how clause 242(8) works in conjunction with subsections (1)(a) and (1)(b). Subsection (8) states:

“The seller is not required to comply with a requirement imposed by virtue of this section if the seller has a reasonable excuse for not complying”.

Does that mean that they do not have to comply with the requirement in subsection (1)(a) to produce a sustainability certificate, or with the requirement in subsection (1)(b) to provide a written statement saying that a certificate does not need to be produced? I cannot see why somebody would not at least carry out the requirement under subsection (1)(b). There seems to be a contradiction in the Bill.

Iain Wright (Labour, Hartlepool)

I think that I followed the hon. Gentleman’s argument, and I suggest that it is an either/or situation. The seller is required to provide either a sustainability certificate or a written statement to that effect. Subsection (8) deals with non-compliance conditions, and it is either the sustainability certificate or the written statement that need not be supplied. However, I understand the logic of the hon. Gentleman’s argument about why a seller would not provide a written statement, which returns to the point about “reasonable excuse” that he made earlier.

Grant Shapps (Conservative, Welwyn Hatfield)

So effectively a seller could comply either with subsection (1)(a) or with subsection (1)(b). If they failed to comply with either of those provisions, they would simply need to comply with subsection (8), in which case they would comply with subsection (1)(b) in the process. That seems a circular procedure. Have I understood it correctly?

Iain Wright (Labour, Hartlepool)

No, I suggest that the hon. Gentleman has not. The onus is clearly on the seller to provide the certificate, or a written statement to that effect. If they do not do so, they must provide a reasonable excuse. That will be tested, perhaps by the enforcing authority or through the courts. I hope that that answers the hon. Gentleman’s question. It seems clear in my mind, but I apologise to him if I have not articulated it correctly or well enough for him. However, I hope that it provides him with reassurance.

Clause 243

Lembit Öpik (Liberal Democrat, Montgomeryshire)

The Minister may treat this as a rhetorical point. In light of what he said and the potential confusion that I think will persist, given the framing of the legislation, he might want to revisit clause 243 and subsequent clauses between now and Report stage, in order that he can be confident that the structure of the clauses will not lead to the type of confusion that we have just discussed. We do not need to have the same debate again, but I counsel him to reconsider this group of clauses. I might even do some research myself between now and Report stage to see whether his optimism about people’s understanding of stars versus alphabetic labelling is as straightforward and robust as he claims.

Iain Wright (Labour, Hartlepool)

I look forward to seeing a copy of the Liberal Democrat Focus sheet about that. The hon. Gentleman makes a good point. Although I was reluctant to discuss clause 243 because I thought that an accusation might be levelled at me with regard to a list, I think that it is important to have as clear a definition of sustainability as possible to try to avoid uncertainty in the market. I take on board the manner in which he asked the question, and I will certainly go away and look at it again.

Clause 244

Alistair Burt (Conservative, North East Bedfordshire)

Is it the Minister’s assumption that those currently charged with handling HIPs will also be the authorised assessors? Have the Government an idea yet of the sort of fee that will be charged for the services of those who will provide sustainability certificates?

Iain Wright (Labour, Hartlepool)

The assumption is that domestic energy assessors could provide these certificates. That is perfectly possible. It could be part of another package that the developer or the builder provides in respect of the new buildings. I do not want to dodge the question about costs, but the cost of a sustainability certificate would vary, depending on the size of the development, the services provided and so on. So I cannot provide a great deal of reassurance to the hon. Gentleman in that respect. We expect the average cost of a certificate to be about £210 or £220 per home, but we have forecast that it could be as high as £1,600 for a single home on a single site that was built in isolation. I imagine that, as the information becomes clearer to the industry and there is greater awareness of what needs to be taking place, costs will be driven downwards, but I hope that what I have said provides a ballpark figure for the hon. Gentleman to criticise me with.

Clause 245

Alistair Burt (Conservative, North East Bedfordshire)

Again, this may be more germane to the Minister himself. I call his attention to subsection (4), which states:

“The regulations may require a person wishing to enter a document onto a register to pay such fee as may be prescribed.”

Presumably, the fee will be within the control of the agency or the Government. Does the Minister have an idea of what sort of fee we might be talking about in these circumstances?

Iain Wright (Labour, Hartlepool)

No, I do not, but I can certainly look into the matter on the hon. Gentleman’s behalf. I will ensure that I do so.

Clause 246

Lembit Öpik (Liberal Democrat, Montgomeryshire)

Do the enforcement authorities as outlined in the clause already have the necessary skills and competences to carry out their new responsibilities? If not, what process does the Minister envisage to ensure that those authorities are not left vulnerable to a failure to carry out the duties that they are being charged with? I am particularly concerned that the authorities themselves may say that this is yet another additional burden for which they do not have sufficient resources.

Iain Wright (Labour, Hartlepool)

The hon. Gentleman raises a very good point. We have provided additional resources to compensate local authorities for the extra burdens that they may have, certainly in relation to home information packs. We are consulting closely the Local Authorities Co-ordinators of Regulatory Services—LACORS—about EPCs, HIPs and so on. We keep the matter under constant review. If there is any additional burden or any additional complexity with regard to training or expertise in this respect, LACORS will highlight that to us and we will amend resources funding accordingly.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

That is a helpful response from the Minister. I hope that he recognises the consequences of what he has said. As I understand it, the certificates that we were previously discussing incur a fee for the vendor, but the Minister has said that the Government will resource the authorities for the extra burden. I suspect that he may not have thought through entirely the relative sharing of cost between the vendors, who require the enforcement authorities to carry out the work, and the authorities. If he is honest and says that he has not thought about it, that is fair enough, but we need some clarity on the issue. This is important because it is unquestionably at the cutting edge in the eyes of the public. The answers to my questions will to a large extent define the cost of the certificates to potential vendors. The more the Government pay, the less the certificates will cost vendors, and vice versa. I highlight this matter as being of strategic importance to vendors, if only of tactical importance to the Government.

Iain Wright (Labour, Hartlepool)

I will check in Hansard, but I think that I said that we would keep it under close review and would monitor it, rather than providing a blank cheque to local authorities. I also said that we have provided additional resources for the extra burdens on local authorities from HIPs.

I understand the hon. Gentleman’s point about this matter being at the cutting edge. However, trading standards officers, who are named in the Bill as the enforcement authority, will not need any technical knowledge when looking into it. All that they will need to know is when a code certificate should be given and what it looks like, and they will need to be familiar with the provisions in this chapter on disclosure and offences. I suggest that they will not have to go on long courses to gain technical knowledge about sustainability. I calculate that the burden will not be too onerous, but LACORS will keep us informed on that.

Lembit Öpik (Liberal Democrat, Montgomeryshire)

I understand, therefore, that this element of the cost of certificates is a public burden, which makes a lot of sense. Other burdens, such as getting someone to do an evaluation, may be the vendor’s burden, but this element is a burden on the public purse. If that is what the Minister is saying, it is a useful clarification.

Iain Wright (Labour, Hartlepool)

Yes, I confirm that.

Grant Shapps (Conservative, Welwyn Hatfield)

Will the Minister reflect on the experience gained from introducing legislation on houses in multiple occupation, which required local authorities to provide the enforcement? I am aware that many local authorities around the country have struggled to enforce HMO legislation through a lack of resources in the town hall, and I am concerned that the Bill should not end up creating yet more requirements that cannot be enforced. Will the Minister consider that experience in relation to how enforcement might be applied?

Iain Wright (Labour, Hartlepool)

I appreciate the hon. Gentleman’s comments. I shall take on board the notion of HMOs and the possible problems of definition; I shall keep that on my desk and have a look at it.

Clause 247

Alistair Burt (Conservative, North East Bedfordshire)

I am slightly puzzled as to who, apart from a potential purchaser, will want or need to see the certificates. The clause is all about how to deal with someone who will not produce one. If a certificate is not produced when required, surely the buyer will not complete the sale, so I am puzzled as to why the clause is necessary, particularly as we shall go on to talk about enforcement and penalties for people who do not produce certificates as required. In what circumstances will the power be needed?

Iain Wright (Labour, Hartlepool)

As we are making it mandatory to provide information on the sustainability of new homes, we need an arm to enforce that.

Alistair Burt (Conservative, North East Bedfordshire)

But my point is that if I were a purchaser and I knew that I needed a certificate, my lawyer would not let me complete the sale unless I had received it. Why would anyone else need to be involved? If the vendor did not produce one, I would not go ahead with the sale, so it is in their interests to produce one. Who else needs to be involved?

Iain Wright (Labour, Hartlepool)

I accept that it is in the vendor’s interests to produce it, but not all information is always provided. Given that it is mandatory to provide a certificate, we need to have an enforcement element. It is similar to the situation with HIPs. I am sure that the hon. Gentleman wants to lead me down that route, but I shall go down it anyway. Home information packs are mandatory on all properties now, but in some cases they are not provided and we need enforcement. It is a natural part of business, and it seems reasonable.

Alistair Burt (Conservative, North East Bedfordshire)

The Minister is doing well, but he is struggling on this issue. If, when buying a property, I need to see the HIP or the sustainability certificate before I complete the transaction, but it does not happen, I will not go ahead, so it is at the vendor’s expense if they do not comply.

However, the clause talks about

“an authorised officer of an enforcement authority”.

Who is the authorised officer, what is he authorised to do, and why? I am not trying to harass the Minister or chase him down the HIPs route. That job is usually done spectacularly well by my hon. Friend the Member for Welwyn Hatfield—and has been for several months. Genuinely, who will turn up on the doorstep of a new house, as an authorised officer in a uniform, like Deryck Guyler in “Please Sir!”, if the Minister remembers it from days gone by, and say, “I am from”—whatever it is—“and I demand to see your sustainability certificate, and if not I have these powers”?

I am intrigued as to how far the measure goes, because as the Minister knows, there are national newspapers that are very concerned about the increasing powers of people who would do just what I have described, and it may be that a word will have to be had with those papers, because they might be very interested. That is not a threat at all, but I am genuinely puzzled about the circumstances in which the Minister sees an authorised officer wanting to do what I have described. Who would ask them to do it?

Iain Wright (Labour, Hartlepool)

I do not want to labour the point, but enforcement is a natural and necessary arm of such a mandatory measure. I shall use the risk-based approach and suggest to the hon. Gentleman that if a buyer complained to the trading standards officer, and said, “I have not got a certificate,” the officer would investigate.

The rest of the debate is in Hansard.