Immigration Bill

Public Bill Committee, 7 November 2013.

Clause 15 - Residential tenancy agreement

David Hanson (Labour, Delyn)

I beg to move amendment 49, in clause 15, page 15, line 7, after ‘Chapter’, insert ‘subject to the provisions set out in section [Consultation with the devolved administrations]’.

Katy Clark (Labour, North Ayrshire and Arran)

With this it will be convenient to discuss new clause 1—Consultation with the devolved administrations—

‘(1) Prior to the implementation of sections 15 to 32 the Secretary of State shall consult with the Scottish Government, the Northern Ireland Executive, and the Welsh Government on the implementation and principles of these sections.’.

David Hanson (Labour, Delyn)

On behalf of the Committee, I welcome you to the Chair, Ms Clark. I know that you are going to take us through the remainder of our sittings. I am sure that you will have an interesting time. Could you pass on our thanks to Sir Roger for his chairmanship to date?

I have tabled new clause 1 to tease out the relationship between the Government’s proposals for landlords and the discussions they have had with the Scottish and Welsh Governments and the Northern Ireland Executive. I am acutely aware that immigration is a non-devolved matter, which is what I wish it to remain. I want immigration, which falls within the Minister’s responsibility, to remain as a matter for the House of Commons, both now and in the post-referendum era.

The key issue is that the proposals will impact on housing. As you will know, Ms Clark, being a Scottish Member of Parliament, and as I know, as a Welsh Member—indeed, as my hon. Friends the Members for Glasgow North East and for Glasgow North West will also know, being Scottish Members—housing is devolved to Scotland and Wales. As a former Northern Ireland Minister, I have dealt with housing in Northern Ireland, but that, too, has been devolved to the Northern Ireland Executive.

The proposed provisions for landlords will, I believe, still impact on housing issues in the United Kingdom as a whole, with potential knock-on effects if they become operational throughout the UK. We will discuss that in more detail later. The proposals might have major knock-on effects on housing in England, which is the responsibility of this House, and on housing in Scotland, Wales and Northern Ireland. It is important to know what discussions the Home Office has had with the devolved Administrations about the potential impact of the provisions for landlords before our consideration of them and before their implementation.

We will talk about the potential for a pilot later, in the debate on new clause 2, when there will be discussions about what that will mean in practice from the Government. Whether the proposal is piloted or not—I am not clear how that will work—it could be implemented across the whole UK at some point in its current form. That means that the immigration element of landlord checks will have an impact on the different relationships with the Scottish Parliament, the Welsh Assembly and the Northern Ireland Executive, an impact on their housing regulation, a potential impact if individuals are moved out or find it difficult to obtain housing because of the Bill, or other possible, unintended consequences.

I will not discuss those consequences now; I will do that in the debate on new clause 2. My purpose is to ask what discussions the Minister has had, what the response has been, what consultation has been undertaken and whether he will publish the results. I recall my hon. Friend the Member for Glasgow North West raising the matter with the Immigration Minister when the Committee was considering evidence. The Minister said that he would potentially publish the discussions about what had happened, which I would welcome. He said:

“This issue came up briefly on Second Reading...I am clear about this: all the provisions in the Bill on the health surcharge and on residential tenancies use our reserved powers for immigration matters. As those measures have a wider impact, we have had discussions with our counterparts in Scotland, Wales and Northern Ireland. I wrote to the relevant Ministers...We will continue to hold those discussions. We will happily talk to the devolved Administrations about some of the practical measures, but we are confident that the powers in the Bill use immigration powers that are reserved”.—[Official Report, Immigration Public Bill Committee, 31 October 2013; c. 117, Q243.]

Mark Harper (Conservative, Forest of Dean)

Spot on!

David Hanson (Labour, Delyn)

I am pleased that we have Punch and Judy here today, not just Punch on his own. I accept what the Minister said on that occasion, but I want clarity on what the devolved Administrations have said. I want him to be clear about the discussions.

William Bain (Labour, Glasgow North East)

As my right hon. Friend will know, it was established in the Committee’s evidence sessions that the provisions on letting fees were devolved to the Scottish Parliament, which had previously legislated to abolish letting fees in the private rented sector. Does he share my concern that this legislation could require the Scottish Parliament to reintroduce fees into the private lettings sector where letting agencies are involved? The Committee deserves to know what discussions the Home Office has had with the Scottish Government on those issues.

David Hanson (Labour, Delyn)

My hon. Friend makes a valid point. To be honest, I do not know the answers; the Minister needs to address those issues. If the clauses containing the landlord provisions are approved—if we have a pilot or a phased roll-out and they are implemented at a future date—that will be the law of the land, and there will be consequences and potential costs. I have had representations from the Law Centre Northern Ireland and the Housing Rights Service about the impact of the provisions on Northern Ireland. The Minister might be able to answer their points, but it is fair and proper that he at least consider them. For example, page 2 of the Law Centre Northern Ireland submission states:

“The consultation paper refers to the protected characteristics of tenants as specified in the Equality Act 2010 but does not reference corresponding Northern Ireland equality legislation.”

The Bill mentions Northern Ireland equality legislation, but it is important that the Minister states, on the record, whether all aspects of, for example, Northern Ireland equality legislation have been considered and consulted on, and are part of the fabric of the Government’s approach to the Bill. We will discuss what that all means at a later stage.

On the Home Office’s overview of the proposals, the Law Centre Northern Ireland also stated:

“We are alarmed by these proposals, both in terms of their legality and in the way they are presented here as a short reference at the tail-end of a summary document. There is no...discussion about...rules or guidance in the full consultation document. It is important to recognise the different legal basis for the housing selection scheme in Northern Ireland and the role played by the Northern Ireland Housing Executive (not local councils) in administering the scheme.”

Sometimes I ask questions when I know the answers, because I want to tease out an answer publicly, but on this occasion I am not sure of the answers. These are valid questions about the legality and the impact of the legislation on Northern Ireland, and the Minister needs to reflect on that.

The Minister’s helpful guidance on the draft anti-discrimination code indicates that steps are being taken under the Race Relations (Northern Ireland) Order 1997. Will he make it clear whether any legislation post 1997 has been considered and whether the Northern Ireland Executive have been consulted about the impact on tenancies?

I am skipping ahead—for which I apologise—but this issue relates to the devolved provisions in new clause 2. When we reach clause 26(6), which pertains to enforcement, we will see that it states:

“Money paid to the Secretary of State by way of a penalty must be paid into the Consolidated Fund.”

That clause might be of particular interest to my hon. Friends the Members for Glasgow North West and for Glasgow North East, because it states:

“In Scotland the penalty may be enforced in the same manner as an extract registered decree…execution issued by the sheriff court of any sheriffdom in Scotland,”

and:

“In Northern Ireland the penalty is recoverable as if it were payable under an order of a county court in Northern Ireland.”

This is therefore a devolved responsibility, yet any penalties accrued under clause 26 will be given to the Consolidated Fund, which is run by the United Kingdom Government. Therefore, although there will be a cost to Scotland and Northern Ireland for enforcement, under clause 26 the penalties collected will be paid into the Consolidated Fund of the United Kingdom Government. Will the Minister tell the Committee whether he has had any representations and whether he has discussed the implementation and the cost? I do not know, and it is important that we do know.

I do not want to spend too much time on this matter, because the bulk of our discussions will be about the next group of amendments, which concern the pilot and the feasibility and challenges of these measures. However, there are serious issues about housing and enforcement in Scotland, Wales and Northern Ireland, and what the unforeseen impact of the Bill downstream will be in those areas. It is important that we know from the Minister what those three Administrations have said. Although this proposal might never actually be implemented—because of the phased roll-out, the pilot, the general election and whatever else—we still need to know how it will apply to those three integral parts of the United Kingdom. [Interruption.]Before I sit down, I would like to put it on record that the group in the Public Gallery did not leave because of something I said. I think they were planning to leave after 10 minutes. I had hoped to sit down after nine and three-quarter minutes, so that the Minister could have them walk out on him instead. Sadly, my timing yet again failed miserably.

Norman Baker (Liberal Democrat, Lewes)

May I welcome you to the Chair, Ms Clark? The right hon. Gentleman suggested that you might have an interesting time. I am not sure that is entirely true, but you have a valuable role to play. We look forward to your help in guiding us through our work in this and future sittings. As we are trading antecedents, I must declare an interest as a Scottish Member of Parliament—I was born in Aberdeen—albeit not as a Member of Parliament for a Scottish constituency.

It is important that we do not conflate two matters. We have heard a lot about the housing sector, but it is important to state that this is a reserved matter. It is not sensible to read across from the fact that it is a reserved matter to the potential implications—I am not sure there will be any—for the housing sectors in Scotland, Northern Ireland and Wales. The measures in the Bill regarding landlords and their agents are intended to restrict access to the private rented sector for those who are in the UK in breach of our immigration laws. Those measures are not about regulating the housing market, but about making consistent arrangements across the UK for a class of persons who are not British citizens. It is as simple as that. The intention is to make it difficult for those present in the UK illegally to rent property and to encourage a change in their behaviour, by encouraging them to regularise their stay or leave the UK; it is not to encourage and facilitate their establishing a settled life here. The full impact of the scheme will be felt only after the provisions have been implemented across all areas of the UK. It is therefore important to see it as an immigration provision, rather than a housing matter.

William Bain (Labour, Glasgow North East)

We heard evidence from the private tenancy community that the impact will more than likely be passed on to tenants through higher rents or higher letting agency fees. We have established that the devolved responsibilities in Scotland mean that the latter is illegal, so what discussions is the Minister having with the Scottish Government about how the policy will affect private sector rents?

Norman Baker (Liberal Democrat, Lewes)

Opposition Members have been keen to suggest some sort of huge consequence in the housing market in the devolved Administration areas due to these proposals. There will not be. The immigration proposals are entirely separate from those relating to housing regulation, which is properly a devolved matter for those Administrations. The landlord scheme will not create a new system of letting fees in Scotland because the scheme is reserved. It does not change the powers or responsibilities of the devolved Administrations in any way. If Members are keen to hear about them, I will come to the discussions that have taken place in a moment.

Helen Jones (Labour, Warrington North)

I am grateful to the Minister for giving way. How does he think landlords will meet the cost of all these checks, given that they are not allowed to charge letting fees?

Norman Baker (Liberal Democrat, Lewes)

I am not sure that the cost to landlords is particularly onerous in the first place. We will perhaps come to this issue when we discuss the next group of amendments, but many landlords already check the status of their tenants for all sorts of reasons, including to ensure that they are able to pay their rent. A huge, onerous bureaucratic structure is not being created that will engender huge costs for landlords, either in Scotland or anywhere else. If I may say so, this point is something of a red herring. As I was saying, the scheme is an immigration matter, which is reserved in relation to Scotland, excepted in relation to Northern Ireland and non-devolved in relation to Wales.

To answer the earlier query, in practice, landlords, agents, tenants and occupants will need information about how the scheme operates. It is important that all stakeholder views are taken into account to ensure that measures are appropriately targeted and proportionate. We have been keen to ensure that they are proportionate and so have engaged the devolved Administrations, and we will continue to do so during the implementation of the scheme.

My fellow Minister wrote to Margaret Burgess MSP on 3 July as the first part of that engagement. There has been correspondence with Carl Sargeant in Wales and with Nelson McCausland in Northern Ireland. It should not surprise any member of the Committee that we of course talk to devolved Administrations when we introduce measures with a UK-wide impact. That happens both at ministerial and official levels. Those discussions are continuing, but I must say that so far I have not noticed the devolved Administrations expressing any great concerns about the Bill of the type that Opposition Members describe.

William Bain (Labour, Glasgow North East)

I am grateful to the Minister for generously giving way again. He said that no new enormous bureaucratic burden was being placed on the private renting sector or lettings agencies. I simply refer him to his own Department’s impact assessment, which says that the new costs to the private letting sector are in the region of £4.7 million a year. If the Minister does not believe that those are significant new costs, will he say what he thinks are?

Norman Baker (Liberal Democrat, Lewes)

I would refer the hon. Gentleman to the fact that we think the familiarisation of landlords will take between 30 minutes and two hours, or an hour per landlord or letting agent branch. That hardly seems a particularly onerous task. However, if Opposition Members are so concerned about the cost to landlords, they might explain why, with the next group of amendments, they are seeking to extend the pilot beyond one area to a whole range of areas across the country. Presumably that will make matters worse for landlords. If they are concerned about landlords, they must explain why they are putting additional responsibilities their way.

Where there are links between the immigration scheme and matters related to housing, the devolved Administrations may decide that they wish to take the immigration scheme into account for their own purposes. That is a matter for them. For instance, the devolved Administrations are responsible for the regulation of houses in multiple occupation. It may be that they consider it appropriate to take into account whether a person has received penalties under the immigration scheme when decisions are made about whether a landlord is a fit and proper person to operate a house in multiple occupation. In other words, rather than a burden being placed on landlords and the devolved Administrations, extra information might come forward that helps them with the existing responsibilities that they have decided are appropriate for them to have. However, that is a matter for them to consider; it is not necessary in order to allow the immigration scheme to operate effectively.

The position in Northern Ireland was referred to. Equality obligations in Northern Ireland have been and will continue to be considered. Clause 28 refers to Northern Ireland legislation and requires us to consult the Equality Commission for Northern Ireland on the non-discrimination code. The draft anti-discrimination code has been published and subject to consultation with the Equality Commission for Northern Ireland.

David Hanson (Labour, Delyn)

There is a real difference between consulting with the Northern Ireland Executive on a non-discrimination code and taking into account anything they say. There is specific legislation available in Northern Ireland. Will the Minister ensure that the provisions in the Bill are entirely compatible? It is not just a matter of consulting; are these provisions compatible?

Norman Baker (Liberal Democrat, Lewes)

We have a very open and constructive dialogue with the devolved Administrations on this and other matters. Of course we listen to them, and if they make points that we have to take into account, we will do so. However, the responses so far have not indicated a great deal of anxiety from the devolved Administrations. To some extent, Opposition Members are trying to blow this out of all proportion. I hope I have given satisfaction on the fact that we are consulting, we are listening to the devolved Administrations and we are taking account of what they say, and we will continue to do so. On that basis, I ask the right hon. Gentleman to withdraw the amendment.

David Hanson (Labour, Delyn)

I genuinely do not think that the Minister is too focused on this issue. I tabled the new clause so that the Minister would become aware that, unbeknownst to him, and great lovers of devolved Administrations as the Liberal Democrats are, there are devolved Administrations in Scotland, Wales and Northern Ireland, and they may have a view on these matters. I have seen correspondence this morning, which I am not yet able to share with the Committee, from Carl Sargeant, the Minister in Wales—it is private correspondence and I respect that.

Norman Baker (Liberal Democrat, Lewes)

The right hon. Gentleman is talking about it.

David Hanson (Labour, Delyn)

I am not talking about the content of it; I am saying that I am aware that the Minister has been written to, and he needs to be aware of all those matters.

I will not press new clause 1 to a vote. However, it might be an issue we return to on Report, because there will be consequences if the proposal is rolled out. The Minister needs to focus on that. The purpose of tabling the new clause was to ensure that he did not forget those areas because you represent one, Ms Clark, as do I and other hon. Members, and we take an active interest in how such matters are played out. I beg to ask leave to withdraw the amendment.

David Hanson (Labour, Delyn)

I beg to move amendment 50, in clause 15, page 15, line 7, after ‘Chapter’, insert ‘subject to the provisions set out in section [Pilot of residential housing provisions]’.

Katy Clark (Labour, North Ayrshire and Arran)

With this it will be convenient to discuss new clause 2—Pilot of residential housing provisions —

‘(1) Sections 15 to 32 shall not come into force until—

(a) a pilot of these measures has been undertaken in—

(i) one London borough;

(ii) one local authority in a county in England;

(iii) one local authority in a county in Wales;

(iv) one local authority in a county in Scotland; and

(v) one local authority in a county in Northern Ireland.

(2) Each pilot shall last for a period of six months.

(3) At the conclusion of each pilot, the Secretary of State must prepare and publish a report and must lay a copy of the report before Parliament.

(4) Each report shall contain an evaluation of the effects of sections 15 to 32 on the level of discrimination in the private rental housing sector.

(5) A Minister of the Crown must, not later than three months after the report has been laid before Parliament, make a motion in the House of Commons in relation to the report.

(6) If a motion under subsection (5) has been approved by the House of Commons, the provisions of sections 15 to 32 come into force on whatever day or days the Secretary of State appoints by order made by statutory instrument.’.

David Hanson (Labour, Delyn)

The purpose of proposed new clause 2 is to ensure that we put into legislation the principle of a pilot for the residential housing provisions scheme. The aim is to get some clarity from the Government on their intention concerning the pilot/phased roll-out of the proposal. Secondly, the new clause provides the opportunity for a wider debate on the concerns that mean a pilot of the scheme is needed in order to consider the proposals fully.

The meaning behind the Government’s proposal remains unclear. In response to a question from my hon. Friend the Member for Glasgow North West, the Minister said,

“ It is a phased roll-out.”––[Official Report, Immigration Public Bill Committee, 31 October 2013; c. 116, Q242.]

What does the Minister understand a phased roll-out to be? My starting point is the need for a pilot and what it means.

John Robertson (Labour, Glasgow North West)

My right hon. Friend recollects that the answer I received from the Minister was that it is “a phased roll-out”. I am still none the wiser as to what a phased roll-out is, compared with a pilot. I hope the Minister will dot the i’s and cross the t’s.

David Hanson (Labour, Delyn)

New clause 2 gives the Minister an opportunity to do just that. We propose that a pilot should be carried out in line with the details specified in the new clause, and the Government should make a decision about the scheme based on the report from the pilot. The Minister has said that there should be a phased roll-out. Will he explain what he understands that to be? The Deputy Prime Minister has expressed concern about the measure, as The Guardian reported:

“A spokesman for Nick Clegg said the home secretary had been forced to agree to restrict the proposal this side of the next general election to a trial scheme in a single area, as the government introduced the immigration bill in the Commons.

‘The Conservatives want to roll this out nationally but because of our concerns we will not agree to that. This will be piloted in a single area,’ the spokesman for the deputy prime minister said.”

The Liberal Democrat website states:

“The Lib Dems will block the landlord check policy if the trial fails.”

If the Minister will not accept my proposal for a pilot, what is his proposal for a pilot or a phased roll-out? Over what period would it take place, and in what area? What would be the tests?

Nicholas Soames (Conservative, Mid Sussex)

I am grateful to the right hon. Gentleman for raising an extremely important point, and I wonder whether he can help me on it. The problem for me is that the Lib Dem website in Mid Sussex has not been updated for five years. Can he suggest how I might establish the Lib Dem view? I could look on the website of my hon. Friend the Minister for Crime Prevention—a very good website it is, too—but it is not as close to home as the Mid Sussex website.

David Hanson (Labour, Delyn)

Far be it from me to tell the right hon. Gentleman what his local Liberal Democrats are doing, because I have absolutely no idea what they are up to. In a moment, however, he will be able to ask the Minister what a “pilot” means, how long it would last and what the tests for success or failure of the pilot would be. He will be able to ask the Minister whether a pilot is the same as a phased roll-out, and if not, what the difference is.

The hon. Member for Cambridge wrote on the Liberal Democrat website:

“we’ve made sure only one place in England will have to try this out before it can be ditched”.

Does the Minister share that position? If so, what are the tests for ditching the policy? The term “phased roll-out” suggests that the Government will start at phase one and proceed to phases two and three, without stopping to assess the policy in between phases. The Minister’s policy seems to be to have one pilot, and to

“block the landlord check policy if the trial fails”

or ditch the policy. I need to know what the tests are.

What I have tried to do, as ever, is to help the Government. The new clause, as Members will see, simply sets the framework for such a pilot. It is a framework that says what the local authorities should be, what the time scale should be and, ultimately, how the pilot should be reviewed in due course by the Government.

I worry about the scheme. This would be an academic split and discussion between the Liberals and their coalition partners—the majority party in the Government if it were not for the fact that every member of this Committee has received many representations from landlords, organisations and others who say that there are serious problems with the policy. I will be honest: I want to give the policy a fair wind. If we can stop people who are here illegally renting accommodation illegally, that could be a positive thing. However, we genuinely need to pilot the scheme, not “roll it out in a phased way”, and judge its effectiveness. We need to see whether it works and what the impact is, and then make a judgment as to whether we continue with it. That is what I am offering the Minister today.

Nigel Mills (Conservative, Amber Valley)

I am enjoying the right hon. Gentleman’s questioning, but I have one—at least one—problem with his new clause. It does not refer to a pilot or a phased roll-out “at least” in one London borough or “at least” in one local authority. I am not sure that local authorities individually represent a sensible geographic area to which to restrict such a pilot. If there is a boundary in the middle of the community, there could be a strange distortion whereby, on one side of the road, one would not need to do such checks and on the other, one would. Is he sure that a local authority boundary, rather than a whole region, is the best place to define a pilot?

David Hanson (Labour, Delyn)

I think we need to define the geographic area of the pilot. We could, for example, have a pilot in the London borough of Lambeth, which, if I look out the window, I can see just over the river. We could use Derbyshire as the county in England.

Nigel Mills (Conservative, Amber Valley)

Or a city.

David Hanson (Labour, Delyn)

We could. We could have a six-month pilot in Flintshire in my local authority in Wales, in Glasgow or in Belfast. That would enable us to evaluate the impact on landlords and on people who are trying to secure accommodation illegally.

Simon Kirby (Conservative, Brighton, Kemptown)

Would the right hon. Gentleman mind me putting it on the record that Brighton and Hove might be an appropriate place in which to roll out the excellent scheme and to demonstrate that we want firm but fair immigration?

David Hanson (Labour, Delyn)

The hon. Gentleman is standing up for Brighton and Hove, which is a perfectly legitimate thing to do. I would be grateful if the Minister told us where the proposed pilot will take place, or if he is talking about a phased roll-out. If the latter, where will phase one of that roll-out take place? Whether it is in Brighton and Hove, Forest of Dean or anywhere else in the country, will he tell us if there is a break between the initial phase and evaluation?

The pilot is needed because serious concerns have been raised by landlords and other organisations. Let me start, if I may, with Lord Forsyth. My first ever Committee was 22 years ago in this very Room, when Lord Forsyth was the Minister, and I have to say that we did not agree on anything. This time, it is different. The noble Lord Forsyth, who served as Secretary of State for Scotland under John Major, has said:

“Are we not going to get a sort of black economy occurring of unscrupulous landlords and a cash economy as people get around the rules?”

He continued:

“I’m not quite sure how—if you can’t get a bank account and you can’t get somewhere to stay—whether that is actually going to result in people leaving the country”.

Let us start on that premise.

Meg Hillier (Labour, Hackney South and Shoreditch)

My right hon. Friend makes a really important point. A pilot would very quickly show the stupidity of and problems with the scheme. In my constituency, there are many migrants in between leave or indeed illegal, and they are not renting from landlords where they will have to get checks. They are sofa surfing, domestic slaves or lodging temporarily with people and not paying rent. Sometimes, they are staying in churches and so on. They are not the sort of people who will be caught by this measure. My right hon. Friend’s new clause highlights all those problems.

David Hanson (Labour, Delyn)

I am grateful to my hon. Friend, who has a diverse constituency that is in a London borough, and she will know some of the pressures on housing there. The borough of Hackney could be a pilot; I am content to look at that.

The issue is important. During our evidence session on 29 October, Carolyn Uphill, chairman of the National Landlords Association, said in answer to question 68:

“It is going to impose an administrative burden on landlords who are not experts in immigration, over and above the proper checks that they do now…The principle of checking identity is not so much the worry as the logistics of how that is done and understanding the documentation. We certainly fully oppose the idea of periodic checks”.

That is one good reason for a pilot. During the same evidence session, Richard Jones, policy director of the Residential Landlords Association, said:

“we think that the Bill and its provisions are not workable and will not be effective in achieving the objectives set out.”

That is a reason for a pilot and not the phased roll-out that the Minister wants. Caroline Kenny of the Letting Agency Association said:

“we share concerns about the reporting aspect of the ongoing checks.”––[Official Report, Immigration Public Bill Committee, 29 October 2013; c. 43-44, Q68.]

I want to spend a little time on Liberty’s submission to us. It said:

“Given the complexity of immigration law, there are a number of documents that landlords will need to recognise and understand in order to discharge their duties.”

For the record, it is worth saying that landlords will have to know, look at and recognise the following: a UK passport, a naturalisation certificate, a right of abode certificate, a birth certificate or adoption certificate, a European Union passport or Swiss passport, a diplomatic passport, a NATO identification card, International Red Cross travel documents, UN laissez-passers, residence certificates, biometric residence permits, European Union laissez-passers, national identity cards issued by EU member states or Switzerland, a certificate of application, an application registration card held by asylum seekers, and a Home Officer letter of authorisation, not to mention passports and documents from every country in the world outside the EU.

Landlords specialise in housing and being landlords; they are not specialists in knowing their way round the world of passports. A pilot is necessary to ensure that matters are dealt with fairly and properly.

Pat McFadden (Labour, Wolverhampton South East)

I may have more to say about this when we come to clause 16, but does my right hon. Friend agree that the situation will be more complicated because the Home Office holds the documents of many thousands of people while they are making an application? That is not unusual, and it is not unusual for the Home Office to hold them for years while it decides applications. The process is not quick, so what are landlords supposed to do in those circumstances?

David Hanson (Labour, Delyn)

My right hon. Friend makes a valid point, which he knows more about than I do because of the weight of immigration cases in his constituency. It is a question not just of the documents I mentioned, but sometimes the stamp, the visa, the length of stay and people’s requirements. The checks are serious. I want to put on the record once and for all the fact that I am not opposed to the principle, but we must look at how it would work in practice. If it is not feasible, we cannot do it. The Minister should adopt the proposals in new clause 2 because the pilot would at least provide an opportunity to look at the matter in detail.

Gavin Smart, director of policy and practice at the Chartered Institute of Housing said:

“This proposed change will make it much harder for non-British people to access housing even when they have a legal right to live in the UK.”

That backs up the point that my right hon. Friend made. Gavin Smart continued:

“Checking immigration status is complicated so landlords may shy away from letting to anyone who appears not to be British.”

The Residential Landlords Association said in its submission that it has serious misgivings because

“the success, or failure, of the proposal depends on landlords being able to do the job of trained UK Border Agency staff.”

It does not believe they will be able to do that, and it has concerns about unintended discrimination against individuals who are not British citizens but have a right of abode in the United Kingdom. The Minister helpfully told me that some 49 million British citizens have a passport. That means that some 11.5 million British citizens do not. Again, if I were—dare I say it?—a black Briton who did not have a passport, although there is a draft code of practice on discrimination, would not a landlord find it easier to rent to a white Briton with a passport than to me? Those are serious issues that need to be tested in a pilot, not in a phased roll-out. I want the Minister to address those concerns.

Crisis said in its submission to the Committee:

“For many homeless people, particularly single homeless people, the PRS is their main housing option… Many homeless people simply do not have documents such as a passport or birth certificate.”

That is because they have led and will continue to lead chaotic lives. Those are tensions which, again, might present challenges even in a multicultural and complex area like Brighton and Hove, which I visit regularly for conferences.

Maurice Wren, the chief executive of the Refugee Council said:

“the proposals requiring landlords to check the immigration status of tenants are simply unworkable. Landlords are not immigration officials and the types of documentation carried by asylum seekers and refugees are varied and complex. These new measures will undoubtedly lead to wrongful denial of access to housing for those with a right to live in the UK, due to confusion about unfamiliar identity documents and fear of sanctions.”

That demands a pilot. The Immigration Law Practitioners’ Association said:

“Landlords and landladies may be reluctant to rent excluded property to persons who cannot prove their relevant nationality or right to rent for fear that they might not be able to keep them as tenants.”

That discrimination will be there. The Children’s Society said:

“We have concerns that proposals making private landlords check the immigration status of tenants will make children and families homeless because they will be unable to prove their immigration status.”

That is a real worry. I cite those organisations just to put on record some of the concerns about the practicalities and why there is a need for a pilot.

I should like to read a Home Office document into the record. Table 3.3 sets out the step process for a landlord currently to undertake a check:

“You must obtain original acceptable documents for each of the people for whom you have a responsibility to check.

You must ask for and be given original documents from the list shown.

You must check the validity to satisfy yourself that they are genuine, that the person presenting them is the rightful holder.

You must check:

1) photographs and dates of birth are consistent across documents…

2) expiry dates for leave have not passed;

3) the documents appear genuine, have not been tampered with and belong to the holder;

4) the reasons for different names across documents.

You must take a dated copy of the documents in a format which cannot later be altered and retain them securely.

You must copy:

1) For passports and travel documents: any page with nationality, date of birth, signature, leave expiry date, biometric details and photograph.

2) For all other documents: the document in full, including… a Biometric Residence Permit.”

That is a little bit of bureaucracy that I want to test first in a pilot. I should like the Minister to tell us what the numbers in a pilot would be. How would he evaluate that? What would the cost be? When would it finish? If it is a phased roll-out, there is no pilot and the Minister needs to be honest with the Committee and with his Liberal friends and admit that there is no pilot. It is simply a ruse to get them through to the election without having to resolve this policy difference between the two parties of the coalition, this side of the election.

The Government’s impact assessment estimates the cost to landlords of processing checks under the roll-out to be £36.5 million over 10 years, which is £3.5 million a year. [Interruption.] The Minister says, “Not much”.

Mark Harper (Conservative, Forest of Dean)

No, “Not each”.

David Hanson (Labour, Delyn)

It is still £36 million. Will those costs be met by landlords? Who will eventually find that their bills for rent go up? It will not just be people who are being checked for immigration purposes. It will be people across the board. We need to look at the issues I mentioned earlier about the public sector penalties. The impact assessment states that £6.8 million will come from penalties. I would like to know how the penalty system will work. There is a graded penalty system that goes up to £3,000, and the Minister could increase that in due course. That needs to be piloted.

All in all, the Government’s confusion regarding a phased roll-out and a pilot is self-evident to everybody. Government Back Benchers know it, Ministers know it and the Deputy Prime Minister knows it, which is why he has dumped on the Home Secretary by saying the roll-out will be ended and the pilot will be introduced. I want the Government to be clear on this.

Norman Baker (Liberal Democrat, Lewes)

We are clear.

David Hanson (Labour, Delyn)

I genuinely do not think they are clear. I look forward to having some clarity from the Minister, because it would be interesting to see what a pilot phased roll-out means. The hon. Member for Cambridge has said the proposal will be ditched after the pilot. He and the Liberal Democrat website have said we will not proceed with the pilot if it does not work. What are the tests to establish whether it is working?

I have tried to offer a framework for a pilot. If the Government want to offer their framework, I may not press my new clause; if they do not offer a framework, I will reserve the right to push my new clause to a vote.

Julian Huppert (Liberal Democrat, Cambridge)

It is a pleasure to serve under your chairmanship, Ms Clark.

I thank the shadow Minister for his kind quotes. Perhaps he should try to get his sources correct next time: blogs are not the same as official party websites. I suspect he would not want me to read out things on LabourList as official Labour party policy, because I am sure he would not agree with a number of the pieces on it.

The right hon. Gentleman did, however, correctly identify an article I wrote for Liberal Democrat Voice, and I thank him for quoting it, because that saves me having to read out the same words in my speech. However, I think he draws a rather fine distinction between the concepts of ditching something and of not allowing it to proceed; most people would understand that there was not a massive difference between them.

There is no doubt that there is a difference on this issue between the two parties that make up the Government, and there is no surprise about that. We have a disagreement, and we are working together, but we have not achieved the perfect thing either of us would like. However, while we, at least, are two parties, and hence have different views, I was struck by the fact that there was a contrast between some of the comments of the right hon. Gentleman, who explained both why, in principle, he had a problem with the approach in the Bill and why, in principle, he agreed with it. I find that fascinating. We have a disagreement between our two different parties, but he seems to have a disagreement with himself. I was quite struck by that.

I agree with much of what the right hon. Gentleman said about the problems with the proposal, which is why I am so perplexed that he not only thinks it is perfectly acceptable—that is what he said in our Westminster Hall debate, and he made similar comments at the beginning of his speech today—but wants to see more of it implemented right at the start.

David Hanson (Labour, Delyn)

The Liberal Democrats have apparently—I still want clarification from the Minister—agreed to do a pilot in one region. Unfortunately, the United Kingdom happens to be bigger than just one region. If there is a pilot in England, there is still Wales, Scotland and Northern Ireland. My hon. Friends’ seats in London are quite different from the constituency of the hon. Member for Amber Valley, in Derbyshire. We need to pilot this across the whole country, not just in one area, to see the impact.

Julian Huppert (Liberal Democrat, Cambridge)

I will come back to that in a moment, if I may, because the right hon. Gentleman makes the core point.

First, however, let me explain, because the right hon. Gentleman did so at great length, why I have a concern about this proposal. I am genuinely concerned about the effect it will have on a huge range of vulnerable people and communities. I am concerned about the work load on landlords, although I will not spell out exactly the same details, because I agree with that part of what he said.

I am also concerned whether the Home Office will be able to do everything it has set out to do, because there may be problems. A period of 48 hours is quite a long time in a fast-moving property market. In my constituency, lots of properties come off the market well within 48 hours; it is rare to see something advertised in the paper that had not already gone by the time the paper was printed, and that is true in many other constituencies around the country.

I am concerned that errors will be made and that people will be deprived of housing they should have a right to.

Pat McFadden (Labour, Wolverhampton South East)

The hon. Gentleman mentioned 48 hours. The question in my mind is why we should believe that a Department that can take a decade to make a decision will suddenly be able to make one in 48 hours.

Julian Huppert (Liberal Democrat, Cambridge)

The right hon. Gentleman raises an absolutely reasonable point. We are still clearing up the asylum backlog from the last Government. He is right to make the point that the Border Agency was not capable of doing so; there are many cases that have taken far too long. In the Government’s defence on this issue, the ruling as I understand it is that if somebody gets no response within 48 hours, they are entitled to assume that they have permission and that they can proceed. A provision has already taken account of that, because there are cases where there is no 48-hour response. Although the right hon. Gentleman makes a good point, it has been dealt with.

We have experienced what happens with workplace checks. There is a long-existing system in which people offering employment must check that people have the right to work, but I have constituents who have lost employment to which they were legally entitled due to errors made by the Border Agency, now the Home Office. There have been cases in which people have given the wrong information when somebody has rung up the helpline, so they have not got the correct answer. There have been cases in which people have had a letter saying that they are allowed to work while their claim is being processed, but the letter says specifically that it is valid only for six months, because the idea is that the decision will be made during the six months. Then, when they reach the end of that six months, they hit a problem, because the piece of paper has a certain validity, whereas it should be valid until the decision has been made, if it is the Home Office’s fault. I have genuine concerns about how that will work, which is why, in my ideal world, under the Liberal Democrat majority Government that I look forward to, I would not like to proceed with it.

Helen Jones (Labour, Warrington North)

In the piece that my right hon. Friend the Member for Delyn quoted earlier, the hon. Gentleman said—I am paraphrasing—that the Liberal Democrats forced the Tories to accept the scheme being trialled in one place only. Then he said:

“I’ll be firming this up, and making sure that no future Government can dodge there being a vote if they want to do this.”

If the Bill as it stands is passed, how will he ensure that there is a future vote?

Julian Huppert (Liberal Democrat, Cambridge)

The hon. Lady should have a look at clause 63(7), which says that there must be a process for any further orders, which it says are subject to annulment in pursuit of any resolution of either House of Parliament. I was concerned about that. I tabled amendment 38, to which we will come later, precisely to require the affirmative rather than the negative procedure. I accept that the language that I used in that amendment is not the perfect procedural language of the House—[ Interruption. ] No, it is the language that one uses when trying to communicate with the general public, and I am not sure the general public know the difference between the affirmative and the negative procedures for statutory instruments. The hon. Lady clearly had not got as far as amendment 38 in order to understand clause 63(7). There are concerns.

It will be hard for landlords in some cases, although undoubtedly most cases will be simple and clear. However, there are a lot of documents, and there are concerns. Progress has been made, and I welcome the expansion in the draft code. For example, a measure that will help people who are homeless or in other circumstances, such as not having a passport, is that they can get a letter of attestation from a named Government or local government official or a British passport holder. It is quite an interesting document. It is one of the two documents that can be produced. It solves a number of the problems that we discussed earlier. People should be able to build up that sort of evidence, but there will be cases where things are hard and complex.

That has been raised by a number of people. ILPA, for example, talked about people seeking asylum and some of the concerns around that, and wondered whether discretion was enough to deal with it. We will come to people who currently get support under section 95 of the Immigration and Asylum Act 1999, and I will talk later about section 4 issues. I think we have an opportunity to do something better.

Similarly, we have issues about immigration detainees seeking release on bail. As ILPA says, it is right that such people should be allowed to live where they are bailed to; otherwise, it would seem bizarre. There are still issues about the Children Act 1989, the accommodation in which persons are housed under mental health legislation and a range of other concerns. We will discuss some of those later.

I have huge concerns about the scheme going ahead. I would not at all have been happy if it had gone ahead everywhere, but I can accept a deal with the Conservatives, although we have different views, that we will try it somewhere. There is a difference in language. The Conservatives would like to talk about a phased roll-out; I consider it a pilot, because there will be a vote and an evaluation. We will see what happens in one place. However, it should be in one place only, for six months. Then we should have a pause to evaluate it, and in the next Parliament, a decision will be made about whether to go ahead, and we will discuss whether to use the affirmative or negative procedures, because I have a prior belief that the pilot will not work and that we will see all sorts of problems. My expectation is that it will not be a huge success, and the next Government will not want to make progress with it. I understand that there are people who take a different view. I totally accept that, but I can live with a single pilot.

Helen Jones (Labour, Warrington North)

As my right hon. Friend the Member for Delyn has said, if there is a pilot, there will be criteria for assessing it and deeming whether it is a success or failure. What are the hon. Gentleman’s criteria and how will he make the rest of his colleagues in government accept them?

Julian Huppert (Liberal Democrat, Cambridge)

The hon. Lady makes a good point about the need to determine at the beginning of a process how it will be evaluated. For a long time, Government after Government have not done that properly, and the amendment does not talk in detail about it either. I do not have a clear set of measures of exactly how I would do it, but one measure would be to look at how many people who should have been supported were not supported in the way that they should have been. That would look at the number of errors. She is right, but the Minister will, I know, talk about how the policy will be evaluated.

I was horrified when I saw the amendment tabled by the right hon. Member for Delyn. We fought hard in the discussions with the Conservatives to agree that the policy will be tried in one place, to find out whether it works fine, as some in the coalition think, or causes problems, as others think. I was shocked that under his amendment we would impose the pilot on more places, so that if it went wrong, it would go wrong in more places. I am sure that the people of Lambeth, Derbyshire, Flintshire, Glasgow and Belfast would not be that keen on his suggestion that they be the guinea pigs for the policy. [Interruption.] Whether it is Lambeth or Hackney, people would not be keen.

David Hanson (Labour, Delyn)

It may have escaped the hon. Gentleman’s notice, but I am not the Government. I have suggested that we look at these areas. If he thinks that the one area chosen for a pilot will be symptomatic of every challenge in the United Kingdom, he should go back to Cambridge, do a bit more research, think in more detail and realise that there are more places on earth to pilot in than just one area of the country.

Julian Huppert (Liberal Democrat, Cambridge)

Of course I understand that, but I do not believe that the pilot will be a success. We will struggle and there will be problems, and that is why running a pilot in only one place limits those problems. If it turns out that the pilot is a success, but further work is needed, nothing in the legislation stops the policy being phased in its roll-out. One can have a few places to try it out, such as in Scotland and Northern Ireland. The legislation does not say that if the policy is rolled out after the pilot, it has to be rolled out absolutely everywhere at once. The legislation merely says that there is a process where there can be steps.

The right hon. Member for Delyn is now helpfully saying that the pilots do not need to happen in the places he listed. Anywhere in Scotland, Wales, Northern Ireland or London could be targeted under his amendment, and that bothers me. Having fought hard to ensure that the provisions will be trialled in only one place, because of my deep concerns about them, I find it concerning that the Opposition are arguing for even more pilots. I will definitely vote against the amendment, if he presses it to a vote, because I do not want to impose something that will not work on people around the country.

Meg Hillier (Labour, Hackney South and Shoreditch)

It is a pleasure to serve under your chairmanship, Ms Clark. I will limit my comments, because I am prepared to speak later on some of the wider issues around amendments 52 and 53. I back my right hon. Friend the Member for Delyn in recognising from the Front Bench that the UK is not just one narrow area.

I represent one of the most diverse constituencies in the country. I fear for what this policy will do on race relations and on working with people, among them migrants, with less than settled lives. Those people represent a large number of those who come to my surgeries week in, week out. They have real challenges in finding a home, in holding on to a tenancy and in other areas of their lives. The policy is invidious and nasty and will just cause them difficulties.

I should have drawn Members’ attention to my declaration in the Register of Members’ Financial Interests, as I am a landlord, but that is not what I am speaking about; I am speaking about my constituents. Interestingly, I look at the code that has been written, and I do not think that it will help at all. It puts barriers in place for vulnerable people, who make up a large number of my constituents.

Julian Huppert (Liberal Democrat, Cambridge)

The hon. Lady talks about the idea of having immigration checks done by landlords as invidious and nasty. Does she therefore disagree with the shadow Minister, the right hon. Member for Delyn, who says that he thinks that it is perfectly acceptable in theory?

Meg Hillier (Labour, Hackney South and Shoreditch)

No, I am talking about the way that this is being proposed and the list of documents that have to be provided. I know that many of my constituents—many of whom are British or have indefinite leave to remain, who have lived in this country for many years and have absolute rights to a range of public services—will find that when they go and access this sort of public service they will absolutely face open discrimination. We have already seen in some good broadcast journalism an example of how some landlords are saying: “We do not want to let to black people.” It is as basic as that for many of my constituents.

Helen Jones (Labour, Warrington North)

Does my hon. Friend agree that this is where the proposal of the hon. Member for Cambridge for a one area pilot falls down? If you did a pilot in, let us say, a rural area of Britain, it would not throw up the problems of a pilot in an inner-London borough, for example. There are many other variations throughout the country too.

Meg Hillier (Labour, Hackney South and Shoreditch)

My hon. Friend hits the nail on the head. That is the issue. If the Government are going to have a pilot, they have to make sure that it covers all these eventualities. I do not want to quote at length from the code, but it tells the landlord that if someone says that they have a time limit on their stay, the landlord should suggest they contact the Home Office to seek clarification of their status or additional documentation. This is written by someone who has never had to deal with the Home Office as an immigration customer. The Minister knows that I am one of his biggest customers and he signs many letters to me about all sorts of things. Perhaps that is something we would like to see change, as the Home Office deals with these things more quickly in future, one hopes. However, this is ridiculous. Constituents of mine, who are perhaps in the process of applying for new leave, having to go to get that documentation will not get across the threshold. So this code actually embeds an excuse to be prejudiced against anybody with difficult paperwork.

I see the Minister nodding. The hon. Member for Cambridge has said that he will not vote for this if it is pushed to a vote and I wonder what the Minister will do. I am sure that he will give us his view in his response. If it is the Liberal Democrats’ settled view that the policy will not work practically, I hope that he would vote against it on that ground alone. It is interesting that the hon. Member for Cambridge has practical concerns about all these issues. He has indicated that he will vote for us if we divide. He talks a lot about his ideal world, but we are in this world now, Minister, and this is the world that my constituents have to navigate. This is the world they get discriminated in, and this poorly set out proposal will make it worse for them. It is not even practical, regardless of some of the other issues.

There is no real guidance at all on how the Home Office will evaluate the proposal’s impact practically, or, from my point of view more seriously, on how it will evaluate whether there are landlords who discriminate on race grounds. There are so many caveats in that code that one can ride a coach and horse through it. Landlords will continually discriminate against people, but who will complain? For those who are vulnerable and trying to find a home, it is probably not at the top of their list to go through all the processes to complain about race relations. A lot of people just live with it. They should not, but they do—though if they find me I will take it up for them.

Who will complain and how on earth will the Home Office evaluate this? With the number of landlords in this country, it is impossible to do that. The Minister really needs to answer all these questions, and I hope particularly that he will vote for our amendment, if we push it to a vote, to pilot this in a much wider area. If it is piloted just in the constituency of my right hon. Friend the Member for Delyn—which I am sure is a lovely part of the world—it does not reflect the needs of many of my constituents and the day to day discrimination and challenges that they face.

Norman Baker (Liberal Democrat, Lewes)

May I begin by confirming that I will not be voting with the Opposition? Let us start from basics: the coalition Government—both parties—considers that it is right in principle that a person who is here unlawfully should be excluded from enjoying the privileges of establishing a settled life here. I am not quite sure that that is entirely the view of Opposition Members. There seems to be a difference between the official spokesman and the hon. Member for Hackney South and Shoreditch, but that is the view of both parties here.

Meg Hillier (Labour, Hackney South and Shoreditch)

I am puzzled by the Minister. Perhaps I should clarify, though I do not think I need to. I agree that people who are here illegally should not have access to certain services. What I am saying is that many of my constituents who are legally here and are British citizens will face discrimination because of the way that this is being introduced.

Norman Baker (Liberal Democrat, Lewes)

I am grateful to the hon. Lady for that intervention, because it confirms that she is happy to deal with people who are here illegally, but she does not necessarily will the means to achieve that. Racial discrimination is unlawful under legislation introduced by the previous Labour Government. I assume that that legislation is sufficiently rigorous to ensure its correct application in such situations.

Meg Hillier (Labour, Hackney South and Shoreditch)

Will the Minister give way?

Norman Baker (Liberal Democrat, Lewes)

I will, but I am keen to make progress.

Meg Hillier (Labour, Hackney South and Shoreditch)

The Minister says that there is law in place to prevent discrimination, but if there is to be a pilot, how will the Home Office evaluate how that law is applied and what happens if it is broken? That is a real issue when dealing with thousands of landlords and thousands of individuals.

Norman Baker (Liberal Democrat, Lewes)

If the law was broken, the previous Government’s legislation would apply, as indeed it should. The Equalities Act 2010 is pretty clear on that point. Public services and benefits are scarce resources, and the same is true of our finite housing stock. Lawful residents of the UK should not have to compete for housing with those who are here illegally. Allowing illegal migrants the freedom to establish a settled life in private rented accommodation affords them the opportunity to evade the law, so the situation must be changed.

Meg Hillier (Labour, Hackney South and Shoreditch)

Will the Minister give way?

Norman Baker (Liberal Democrat, Lewes)

I will not, because I have already given way twice, and I am trying to answer some of the other points that have been raised. The proposal builds on existing practices undertaken by many landlords and agents, who already look at passports and other documents. I will turn in a moment to the measures already taken by landlords to ensure that they have the kind of tenants they want in their properties.

I want to deal with a point raised by the right hon. Member for Delyn, who based his whole argument on the assumption that there is a difference between a phased roll-out and a pilot. His argument is flawed, because that is a distinction without a difference. The reality is that my fellow Minister and I are joined at the hip like Siamese twins when it comes to the matter. We both want to ensure that the legislation works, and we agree that it is sensible to go slowly to take account of the legitimate concerns that people have raised to ensure that we do not end up with a situation that neither of us wants. We want to address the problem of people who are here illegally accessing public services, but we do not want to cause problems for innocent people or for landlords. That is why it is sensible to proceed slowly, step by step.

As we have heard, clause 63 contains provisions to ensure that the scheme can be scrutinised to see how it has worked. Those provisions indicate the Government’s commitment to making sure that should it wish to do so, Parliament can scrutinise the implementation of the scheme following the first stage. Any commencement order that introduces the landlord provisions into a subsequent area, following the initial pilot, will be subject to the negative resolution procedure. The House will be able, if it considers it appropriate, to trigger a debate when there is any suggestion of a further roll-out of the measures, at which point any questions can be addressed.

My fellow Minister and I want to ensure that the proposal works properly. My colleague may have more confidence than I do that it will work properly, but there is nothing wrong with that. We both agree that it is sensible to proceed step by step and to look at the scheme after the first pilot. If it has worked properly, without encountering the concerns that Members on both sides of the Committee have rightly expressed, I have no doubt that it will be taken further. If serious problems have arisen, nobody, including my hon. Friend, will want to take the scheme further.

William Bain (Labour, Glasgow North East)

Earlier, the Minister spoke of the importance of safeguarding public money, but the impact assessment states that the policy will cost the taxpayer nearly £63 million over the period of the assessment. Does that not argue for the importance of having effective trials before throwing good public money after bad?

Norman Baker (Liberal Democrat, Lewes)

First, the policy is not designed specifically around cost. It was not introduced primarily to deal with budget matters. If the hon. Gentleman is interested in cost, he might want to take account of the people who are here illegally and accessing public services. If they were not in the country, the cost of dealing with them would be reduced. If he wants to start producing cost equations, he needs to take into account all factors rather than selectively quoting from one.

Meg Hillier (Labour, Hackney South and Shoreditch)

In the discussions about the cost and impact of the measures, has the Home Office done an estimation of how many people who are here illegally currently rent from private landlords? In my constituency, there will be very few, because they live in a whole different housing sector, which does not seem to figure in the Minister’s imagination.

Norman Baker (Liberal Democrat, Lewes)

It is difficult to quantify who is here illegally, not least because the previous Government did not introduce exit checks, which we are keen to establish. Furthermore, we are not authoritarian as a Government, unlike Labour when it was in power, so we do not scrutinise everybody’s life to a minute degree to find out where everybody is at any particular time. No, we do not know the answer to that specific question, but that is why it is sensible to take the matter slowly and to establish the results of stage 1 of the process to see whether or not it is worth pursuing further. Questions of significance may arise, and we will need to deal with them. It is right that Parliament should have a view on that matter, and consider it at the appropriate time.

If the Opposition are so concerned about the impact on landlords, the cost implications and the unintended consequences, it seems odd that they are proposing a range of pilots across the country, which would affect far more people and far more landlords and have far more cost implications than a pilot in one single area. That is why both coalition parties have agreed to take the matter slowly. Of course it is important to get the pilot area correct and to ensure that it is of sufficient size and sufficiently diverse to pick up any issues that might arise elsewhere in the country. That is what we are presently considering, to see what the appropriate area would be, and it is right that we take time to do that and to ensure that we can properly assess the pilot or the roll-out.

Although I agree with the Opposition that it is right to take the matter slowly, their case is somewhat weakened by the civil penalties scheme that they introduced when they were in government. It was not piloted and was introduced right across the country without a great degree of foresight. The Opposition now seem to have a new policy of pilots that did not apply when they were in government.

Phil Wilson (Labour, Sedgefield)

Will the Minister tell the Committee how he sees the scheme working in areas of selective licensing?

Norman Baker (Liberal Democrat, Lewes)

We are looking at that matter as part of our consideration of where the pilot should be and how it should work. We want to take the matter slowly to ensure that it works properly. We are dealing with an issue that was not addressed by the previous Government and that is of concern to those who are legitimately in this country seeking to access public or private housing and are unable to do so. Under those circumstances, it is right that we investigate all these matters carefully.

Phil Wilson (Labour, Sedgefield)

Will any pilot area include areas of selective licensing as well?

Norman Baker (Liberal Democrat, Lewes)

They may do. We are considering that. Let me just pick up on one other point, which we will come on to later when we look at the landlord provisions in the Bill. As it was raised by Labour Members, I want to try to address it now. There is a suggestion that landlords will face huge obstacles in accessing information, which will mean that they will not be able to discharge the functions that we are asking them to do under this legislation. It is worth pointing out that under employment rules, businesses already check a person’s status, and they seem to manage that perfectly well without any sort of difficulties.

I am not aware of any representations from businesses that talk about the difficulties of checking someone’s status. It is also the case that 37% of landlords already require a prospective tenant to produce a passport. Some 32% accept a driving licence. A survey conducted by the Residential Landlords Association in June showed that 53% of landlords insisted on the production of a passport. The process is already well established. A landlord will always want to undertake certain checks, not least because they want to ensure that the tenant can pay their way. A lot of froth is being generated here, but little substance.

It is right that the coalition Government takes the matter slowly and sensibly. We will listen to all the comments. We want to ensure that we get the matter right, and the way to do so is to proceed in the way that we have set out.

David Hanson (Labour, Delyn)

I appreciate the Minister’s response. He started by saying that he and the Minister for Immigration were like Siamese twins joined at the hip. In my experience of watching television, most Siamese twins spend their whole lives trying to separate. The hon. Gentleman will know that as well. If they are joined at the hip, why did the Deputy Prime Minister spend so much time a couple of weeks ago grandstanding that this was a pilot and not a phased roll-out? The Deputy Prime Minister recognised that there were serious problems with the implementation of this policy. There is a shared objective in the Committee about the principle here, but there is a real difficulty about how it will be delivered on the ground.

I am offering the Minister a proper pilot on a range of areas where the system could be looked at, properly evaluated and brought back to the House of Commons. Where in the Bill is his proposed pilot? In the unlikely event that the Conservatives win an overall majority at the general election, the pilot will not be a pilot then, will it? It will be a completely phased roll-out. If the Labour party wins the next election and we do not need Liberal Democrat support, we will have to consider the matter, but I will be looking at testing these proposals to make sure that they work before undertaking a phased roll-out. The Minister has no guarantees that any of his concerns will be addressed.

Julian Huppert (Liberal Democrat, Cambridge)

Has the right hon. Gentleman looked at clause 63(7), which writes into legislation the fact that there would have to be a separate order-making process? I agree that it would be a negative rather than an affirmative resolution, but has he seen that key safeguard? There would have to be a decision-making process and Parliament would have a say.

David Hanson (Labour, Delyn)

That does not relate to the guarantees that the Minister has given about a phased roll-out. If the hon. Gentleman writes on his blog at lunchtime, he should say that he voted down the potential for a pilot that has no legal guarantee at the moment. It would if new clause 2 were to be accepted. Much as I like to try to be consensual on these matters, there are no guarantees on the points that the Minister has raised, so I will press new clause 2 to a vote.

Nigel Mills (Conservative, Amber Valley)

I have some questions about the wording in the clause rather than the principle of it, which is why I did not think it was relevant to the amendment we have just debated. It would be helpful if the Minister could set out some of the scenarios where these rules will apply. He clearly sees situations in which someone begins by staying in a residence informally for a couple of nights, but it then becomes a sole or main residence at some point in the process. I am just trying to understand exactly where that line will be drawn. A person who started a relationship with someone could stay over at their house for a night or two a week, and most of us would never think it was their sole or main residence at that point. However, if they stayed four or five nights a week, rather than two or three, and they became a potential tenant, would the other person be required to check at that point?

There are some doubts in my mind as to exactly what we expect when we talk about rent. Clause 15(2)(b) says the tenancy

“provides for payment of rent (whether or not a market rent)”.

Presumably, £1 a week would count as a payment of rent, while zero might not. The definition is extended in subsection (5), which says that

“‘rent’ includes any sum paid in the nature of rent.”

I can see situations in which someone might buy all the food, pay the heating bills or provide other services, but not actually pay any rent. That might look like an alternative to rent, and it might be much the same in financial terms as paying the rent, but it is not

“in the nature of rent”

as I would understand the natural use of that term. Perhaps it would be helpful if the Minister could tell us what we mean by “the nature of rent”. Should we refer to the nature of rent or to some rent substitute to make sure we catch similar economic arrangements?

On subsection (4), we require rights of occupation to be for a person’s “only or main residence”, but the Bill does not further define those terms. Those of us who have worked in tax will know that a lot of effort has gone into understanding what “only or main residence” means, for example, when determining which of the houses someone owns is their main residence and is, therefore, exempt from capital gains tax. There is also a lot of case law on how to work out whether someone is resident somewhere for council tax purposes or even for the purpose of determining their voting rights.

Is it the intention that all the case law and all the definitions of “only or main residence” used elsewhere will apply under the Bill to determine someone’s main residence? That could be an important point, especially later, as we try to work out what the exemptions are. Clearly, in a lot of the definitions, residence has to have some kind of permanence and is not intended to be short-term or temporary; the actuality must be that someone lives there for the majority of their time.

As we move forward, we need to understand exactly what those terms mean and to think through which perfectly innocent situations might require someone to start making checks on people when they perhaps thought there was a casual relationship. We must also make sure that people do not find cleverly contrived ways around these rules by constructing strange economic relationships that do not involve rent, but that, to all intents and purposes, look like a tenancy, with some kind of verbal agreement that seeks to avoid these rules.

Norman Baker (Liberal Democrat, Lewes)

The starting point is clause 15(2)(b), which the hon. Gentleman referred to. It says the tenancy

“provides for payment of rent”.

That is a relationship, essentially, between a landlord and a tenant; that is what the clause is designed to capture. I suppose it is theoretically possible that somebody could have an arrangement where they did not pay cash, but instead paid in different ways. We expect that to be pretty rare. Essentially, this is about payment in cash, but if it appears that there is circumvention of the rules, we would seek to address that as time goes on. However, that is pretty theoretical and is probably not going to be the case. Clearly, if somebody is in a relationship with somebody else, that is not a landlord-tenant relationship.

There will be guidance for landlords to help them establish any of these things, and they can consult the Home Office if they are unsure; in fact, it is to their advantage to do so to protect themselves.

Meg Hillier (Labour, Hackney South and Shoreditch)

The Minister raises an interesting and potentially important point. Constituents often come to see me about these issues, usually when they have been in the country for some time, and sometimes when they have been in the country illegally. They have been living in someone’s home, and in return for the roof over their heads, they have variously—I have real-life examples of this—done housework or domestic work. Some have, without wishing to do so, had the children of the person whose home they were living in. In one particular case, a woman slept with the man to get a roof over her head and became a mother as a result. Do such relationships count as rent in payment? They are not as rare as the Minister might think in constituencies such as mine.

Norman Baker (Liberal Democrat, Lewes)

The answer is to look at every individual circumstance on its merits, but if two people are in a relationship, particularly if they are having sexual relations, that does not seem to qualify as a landlord-tenant relationship.

Meg Hillier (Labour, Hackney South and Shoreditch)

Perhaps I was not clear. I am talking about people who are trafficked into this country or who have made a contractual arrangement, for economic reasons, to live with somebody in order to provide care, housekeeping or sex. Such people are often very vulnerable and in a transactional relationship. They might not describe themselves as vulnerable victims, but in my book they are. That is an interesting point in relation to the clause.

Norman Baker (Liberal Democrat, Lewes)

The Home Office, the Government and probably all parties in the House of Commons are very concerned about human trafficking. That is why we are introducing a modern slavery Bill and why we are taking steps to deal with the unwelcome examples that I am sure exist in London and elsewhere. Under such arrangements, the person who was subject to unwelcome measures would not be held responsible. Indeed, we would want to help them. When we discuss amendment 30 we will be considering, for example, the situation of refuges and night shelters. We are keen to ensure that people who are in invidious situations through no fault of their own are not subject to provisions that are unhelpful to them.

The come-back on the landlord—if we can call them a landlord in such a situation—would relate not to the provisions that we are discussing but to provisions enacted elsewhere to protect vulnerable people, and to the modern slavery Bill when that is introduced. I hope that that is helpful.

Nigel Mills (Conservative, Amber Valley)

I want to push the Minister a little further. Clause 15(2)(a) says that a residential tenancy agreement is one that

“grants a right of occupation of premises for residential use”.

The Minister appears to be saying that someone effectively grants a partner a right of occupation because they are their partner, but it does not count as a tenancy for the purposes of the Bill. Is that exactly what he means?

Norman Baker (Liberal Democrat, Lewes)

The only point I can make is that all three conditions have to be met for the clause to apply. It is not simply the case that, under clause 15(2)(a), such an agreement is one that

“grants a right of occupation”.

Under subsection (2)(b) it is one that also

“provides for payment of rent”,

And under subsection (2)(c) it

“is not an excluded agreement.”

All three conditions have to be met.

Schedule 3 - Excluded residential tenancy agreements

David Hanson (Labour, Delyn)

I beg to move amendment 30, in schedule 3, page 55, line 22, after ‘hostel’, insert

‘night shelter or domestic women’s refuge’.

I hope that we can make speedy progress through some of the groups of amendments, to get one or two points on the record. The amendment would add two categories to the definition of “hostels” in the schedule. One is night shelters; the other is domestic women’s refuges. The amendment is designed to test whether the definition of hostel covers those two important types of accommodation. People who are homeless might not have the documentation required by the Bill, by the very nature of being homeless. Women’s refuge shelters are perhaps even more important. Women who have left an abusive partner and have gone to a shelter might have the required documentation, but might have left it at their former home, or else it could be withheld by their former partner, making it difficult to carry out the checks proposed in the Bill.

Does the Minister believe that the definition of hostel in the schedule encompasses homeless shelters or domestic women’s refuges? Will he give an assurance that people seeking refuge in either or both of those types of shelter will not be disadvantaged by the provisions in the Bill?

Norman Baker (Liberal Democrat, Lewes)

I welcome the amendment. It is right and sensible to check that point and we are sympathetic to the right hon. Gentleman’s objectives. I hope I can give him the assurances he is looking for.

On night shelters, the definition of a residential tenancy agreement in clause 15 provides that only those residential tenancy agreements that provide for payment of rent will be considered residential tenancy agreements for the purposes of the Bill. Night shelters, such as those provided or arranged by local authorities under the severe weather emergency protocol when temperatures drop significantly for three consecutive nights, do not require any financial contribution from those persons who need to use them.

Henry Smith (Conservative, Crawley)

I should put on the record my interests, as declared in the Register of Members’ Financial Interests. I am grateful for the Government’s clarification on this point. In my constituency, the Crawley Open House shelter provides support for many people who find themselves in unfortunate circumstances. I am grateful that the Bill takes those circumstances into account.

Norman Baker (Liberal Democrat, Lewes)

My hon. Friend is right to put on record the representations he has received. A specific exclusion for that type of accommodation is not necessary, as it will not in any event be subject to the general prohibition within the provisions because no rent is paid for it. Adding “night shelter” to the definition in paragraph 5 could introduce uncertainty because of the implication that every other type of accommodation for which no payment is made ought also to be listed in the schedule. Those types of premises were not listed for that reason.

On refuges, whether for women victims of domestic violence or any other group in need of protection, the exclusion in paragraph 5 is defined in relation to hostels. Refuges provide accommodation in many forms, but our understanding is that a common feature is that they provide accommodation other than in a separate and self-contained premises, and provide more than just accommodation: they provide either board or kitchen facilities to allow service users to prepare food, as well as many other support services, such as access to counselling and legal advice.

We believe that the definition of hostel for the purposes of the exclusion in paragraph 5 is broad enough to encompass that type of refuge. A hostel is defined as a building used to provide, for “a class of persons”, residential accommodation

“otherwise than in separate and self-contained premises”,

which provides

“board or facilities for the preparation of food”,

and which is not operated on a commercial basis, with

“the cost of its operations…provided wholly or in part by a Government Department, agency or local authority”

or which

“is managed by a voluntary organisation or charity.”

A refuge that provides such facilities for use by a class of persons such as the female victims of domestic violence will fall within the broad definition in the schedule. Specifically including g “a domestic women’s refuge” is therefore unnecessary, and the carefully constructed paragraph is designed to afford protection for an important type of accommodation that provides an invaluable service.

However, given the concerns raised and the importance of the issue, we are making further inquiries to relevant bodies to check whether there may be—we do not think there is—any refuge accommodation that would not benefit from the exemption in paragraph 5. We are checking whether such accommodation is sometimes in

“separate and self-contained premises”

that would not be exempt. Even if that were the case, we would expect that many of the people placed in such accommodation would benefit from the exemption for accommodation from or involving local authorities in paragraph 6. If we find from our further inquiries that we have inadvertently kept any domestic violence refuges within the scope of the immigration checking requirements, I undertake that we will revisit the matter in advance of Report.

Meg Hillier (Labour, Hackney South and Shoreditch)

I thank the Minister; that is a very welcome move. My concern from the people I have spoken to is that night shelters and domestic women’s refuges can be places where people can receive housing benefit, and it is the receipt of housing benefit that makes that a tenancy. I welcome the move the Government appear to be making, but perhaps the Minister can take that point into consideration.

Norman Baker (Liberal Democrat, Lewes)

As I have said, we have covered our bases, and I think the provisions in the Bill already provide the exemptions that we and Opposition Members want. However, I will certainly double-check that before Report.

Nigel Mills (Conservative, Amber Valley)

I know the Minister is a thorough reader of the background, but is he familiar with the quote from Lord Widgery in the case of Ricketts v. Registration Officer for the City of Cambridge in 1970? He said:

“Some assumption of permanence, some degree of continuity, some expectation of continuity, is a vital factor which turns simple occupation into residence.”

The definition we have is that it has to be a residence, not a simple occupation. If someone is turning up for only a few nights during bad weather, it will be hard for them to fall within the basic provisions of the Bill, yet someone in a domestic violence refuge would be in a different position.

Norman Baker (Liberal Democrat, Lewes)

To answer the first question, I am not familiar with that particular quotation from 1970. I regard myself as chastened by not knowing that in advance of that particular question. Rent is often not payable in such situations. We have taken steps to try to make sure that shelters and domestic violence refuges are excluded. If there are any loopholes—I do not think there are—we will try to make sure that they are dealt with by Report stage.

Helen Jones (Labour, Warrington North)

I welcome the Minister’s assurances, but will he undertake to talk to those who provide refuges to ensure that the exemption is properly drawn? There are occasions when people pay rent. As my hon. Friend the Member for Hackney South and Shoreditch said, it is funded through housing benefit, which counts for a lot of the income of some refuges.

Norman Baker (Liberal Democrat, Lewes)

We are in discussions with anybody who might be affected by the Bill. I have indicated—genuinely—that we are very concerned to make sure we do not capture people who should not be captured. We want to support people who are in difficult circumstances. I think the Bill is drafted in such a way that it does not have unforeseen consequences, but we will make sure that we take into account our own concerns and the points made by Opposition Members, and I will be happy to give assurances on Report that everything is hunky-dory. Under those circumstances, I ask that the amendment be withdrawn.

David Hanson (Labour, Delyn)

I am reassured by what the Minister has said and grateful for his examination of the issues. It would help if he wrote to the Committee about his deliberations before Report—obviously it would be too late to table any amendments on Report. However, I appreciate his investigation to date, and I beg to ask leave to withdraw the amendment.

David Hanson (Labour, Delyn)

I beg to move amendment 31, page 56, line 35, in schedule 3, leave out paragraph 8.

I hope that the amendment will be dealt with speedily by the Committee. The amendment would remove paragraph 8 of schedule 3, which at the moment states:

“An agreement to which the Mobile Homes Act 1983 applies.”

I have tabled the amendment to test whether mobile homes in the definitive sense of paragraph 8 could be a back-door route for somebody to subvert the legislation that the Government are seeking to put on the statute book. I say that because a parked/mobile home, a caravan holiday home, a touring caravan and a Gypsy or Traveller home all come within the legal definition of “a caravan”—this brings us to the Mobile Homes Act 1983. Mobile homes are bought in my constituency—people buy them and live in them—but there are also many opportunities for home owners to rent out their properties. Given the Bill’s approach towards landlords from clause 15 onwards, I am interested to know whether the Government’s objective would be undermined by individuals who found a mobile home in a different part of the country and rented it from a landlord or landlady illegally under the terms of the Bill, given that I understand mobile homes to be exempt under the Bill as drafted. Do the Government believe that to be the case?

Norman Baker (Liberal Democrat, Lewes)

First, I express sympathy with the right hon. Gentleman, because the language is sometimes delphic when we are looking at legislation. Indeed, my hon. Friend the Minister for Immigration had a similar issue earlier about this matter. I shall try to be clear. If a person secures a place from the park owner to put their mobile home and they park it there, that is not a rental agreement that would be covered by legislation, nor do we want it to be. However, if the person who secures the right to put their mobile home in place subsequently rents it out, they are effectively a landlord to the person who occupies that mobile home. In that sense, the provisions of the Bill are no different from what they are for any other accommodation.

David Hanson (Labour, Delyn)

They are, and that is the point I am making. Schedule 3 is entitled “Excluded residential tenancy agreements”. Paragraph 8 applies to mobile homes and reads:

“An agreement to which the Mobile Homes Act 1983 applies.”

I want to be clear that an agreement to which the Mobile Homes Act 1983 applies is solely to do with purchase and not to do with rental. For example, my constituency contains many mobile homes, as it is a seaside constituency. Individuals can rent a mobile home from a park home owner—they can also purchase one—or can sub-let it, sometimes for six or nine months at a time, when they are not in the country or are living at another end of the country and unable to use it themselves. I am seeking clarification to ensure that individuals who were here illegally could not rent a mobile home under the provisions of the 1983 Act, so that the landlord would not be subject to the conditions in the Bill.

Norman Baker (Liberal Democrat, Lewes)

The position is as I stated. If someone rents a plot—in other words, they have a right to put their mobile home on a piece of land—that is not covered by the Bill. That is not what is meant by rent; that is the purpose of the language in the Bill. However, if someone rents a plot and then effectively has a tenant in their mobile home, just as they would in another kind of home, that is covered. In that sense, a mobile home is no different from any other place that somebody might rent. The purpose of the Bill is to ensure that we do not capture people who are simply renting a plot over a long period for their mobile home, in which they intend to live. They are not captured by the Bill; the only people who are captured are those who subsequently rent out their mobile home to somebody else. That is what the Bill, albeit delphically worded, achieves. On that basis, I hope that the right hon. Gentleman will withdraw his amendment.

David Hanson (Labour, Delyn)

I am grateful to the Minister for his explanation. I am not quite sure whether, in a Pepper v. Hart sense, it could be tested in law. I am still unsure, given my experience of mobile homes across the country, particularly in my constituency, whether, because it is excluded, an individual could not rent a mobile home on a long-term basis. However, for the sake of speed I will withdraw the amendment and let the Minister reflect on whether this is watertight. I beg to ask leave to withdraw the amendment.

Meg Hillier (Labour, Hackney South and Shoreditch)

I beg to move amendment 59, in schedule 3, page 57, line 4, leave out from ‘building’ to the end of line 26 and insert:

‘between—

(a) a landlord, as defined in paragraph 3 of section 15; and

(b) one of the following—

(i) an applicant for a Tier 4 visa holding a certificate of acceptance of studies issued by an authority-funded educational institution; or

(ii) an applicant for a student visitor visa for a period longer than six months.’.

I wish to move the amendment because the Government’s proposals will put barriers in the way of legitimate students renting accommodation. I seek to introduce a common-sense proposal to achieve what I hope the Government want to achieve—although their language on international students is mixed and muddled, and the mood music in the wider international student community is understandably confused about whether Britain is open for business to students. The amendment would show that Britain is open for business to students, who are a major contributor to our economy, and also reduce the burdens on landlords—once again, I draw attention to my entry in the Register of Members’ Financial Interests.

Mark Harper (Conservative, Forest of Dean)

The Government are very clear that Britain is open for business to students. We welcome genuine students to come to Britain. Sometimes others suggest that that is not the case, but Ministers make the point at every opportunity that students who want to come here legitimately to study at bona fide institutions are very welcome from wherever they come.

Meg Hillier (Labour, Hackney South and Shoreditch)

I welcome that emphatic clarification from the Minister, which will hopefully shape our discussions on how students are affected by the Bill. The amendment would reduce the burden on landlords, students and student support services, which is not inconsiderable when students arrive from abroad and have to deal with accommodation, which puts pressure on a number of our higher education and other institutions. In chiming with the Minister’s desire to welcome students, the amendment would also show clearly that students are welcome, that they contribute and that they are less likely to be here illegally, because they will have been through a number of hoops before being accepted into a university in the first place.

Students are net contributors to the economy; rather than repeat myself, I will quote figures later on in the debate. Notwithstanding what the Minister, as a Government spokesman, said, it is important that this country does not become less attractive to international students to come to than others. We have an awful lot of competition: the Canadians are keen and hungry for English-speaking students; Hungary provides degree teaching in English, particularly for medical sciences; and other European countries are doing so as well as, of course, Australia and America.

We work in an international, competitive market, so barriers, even those that are not financial but make it tricky for a student to find accommodation, can put people off. Word gets around the community of students quickly on whether a country is welcoming or whether a particular university has good student support services. A student who is travelling halfway around the world to study pays the fees, and that is all very well, but they also look at the life they will lead. Therefore, questions such as how easy it is to get accommodation must be part of that. The proposed landlord checks do create a barrier to international students wanting to study here. I raised the risk of ethnic profiling earlier in relation to my own constituents, but international students could be rejected for tenancies in favour of less risky tenants, as landlords and employers already deal with lots of paperwork

The amendment would see the students having already gone through the checks, which are a principle established in other parts of the Bill. That would be an easy way to do checks without the student or landlord having to go through extra hoops and rigmarole along the way, so students would find the process much more streamlined.

The Bill proposes an exemption for halls of residence and buildings where an agreement is in place with the university that the majority of occupants are students, which will mean different requirements depending on where a student wants to live. Some students, perhaps because of their age or physical requirements, may need to live outside of halls of residence while others may want to live in them. The amendment would be a neat way of making it easy for landlords to let to students, who can be recognised easily as students. For some of those landlords, that may be a major part of their business. That will also be good for students.

Groups of landlords will have arrangements with universities but they will not be covered by the Bill’s halls of residence element. The amendment would change that. The Home Secretary has talked about creating a more hostile environment for illegal migrants, though the Immigration Minister clarified that Britain is open for business for international students. If we do not pass the amendment, however, we will send out a negative message to students.

I want to ask the Minister for Crime Prevention some questions. First, do such checks exist in our competitor countries? This is quite an important aspect overall in the way we treat students, and the mood music coming out of this Bill is one of my main reasons for probing this matter. If we look at the ethnic profiling that I touched on in my earlier comments, the BBC recently exposed the practice of some London landlords refusing to let to black tenants. A percentage of our international students, who come from all over the world, are black and it is important that a landlord can easily identify a genuine student who has gone through the required process.

I have further questions for the Minister. How will students be able to prove their immigration status, and can they do so from their home country? That is one of the key things. If I were sending my child—even if they were a young adult—I would want to know that they had somewhere to live before they got here. A letter from a university, as outlined in the amendment, could achieve that.

What kind of agreements are covered by the exemption in paragraph 10(3) of schedule 3? Would the agreement need to be in writing and what is the rationale behind the hall of residence exemption for institutions that have entered into an agreement with a university? All students have ID, so they have all been checked by the university. Perhaps the Minister would explain if there is a rationale or maybe it is just an oversight by the Home Office. A simpler way would be to adopt this amendment and make it much easier for everybody to know who is a student and who is not.

Robert Syms (Conservative, Poole)

The hon. Lady makes some good points. What puts off students is constant rule changes, because the local agents get used to dealing with a particular procedure, then immigration or other rules change and it is an excuse for them to look at Australia, Canada or elsewhere. Whatever we do, let us try to have a stable regime, so that the agents and students know what is expected of them.

Meg Hillier (Labour, Hackney South and Shoreditch)

I thank the hon. Gentleman for his helpful intervention. It is true that we need stability, but also an even-handedness across different types of tenure. Part of the Bill refers to accommodation bought up in bulk by the university, such as the new private halls of residence that are being built in Hoxton, in my constituency. However, a bit of accommodation missed out is the type of house that is regularly let to students by perhaps a sole landlord who may be routinely sanctioned, supported and have an arrangement with the university, but not in bulk. It would be even-handed to say: “If you provide this paperwork, either before you enter the country or perhaps when you are in it but without your full documentation, then if you have been checked and it is proven, then you can provide it to whoever the landlord is, and you will be accepted”.

John Robertson (Labour, Glasgow North West)

Does my hon. Friend agree that just as there are some poor landlords, there are some poor agents as well, who perhaps through forgetfulness or otherwise, do not do exactly as they are supposed to? At the end of the day, the person who is looking for premises will suffer.

Meg Hillier (Labour, Hackney South and Shoreditch)

Absolutely, and this is one of the practical problems of this Bill, regardless of some of the implications of the wider debate that we are having. Practically, if the new arrangement is going to be introduced, let us make it as simple as possible, so there is not more bureaucracy. A foreign student in particular coming into the country will not know the rules. I recently travelled abroad and sat next to a young man travelling into the country from India. He was very enthusiastic, but lacking in knowledge. He asked me some of these questions, such as: “What is it like when you rent a property, how do you go about it?” Although he had done some homework, it was a big, scary thing. I said: “I am sure that your university will support you” and I hope that it did, but it is quite a big step.

I do not doubt what the Minister for Immigration said at the beginning, that he wants to see Britain open for business for students. If he really does, he has the opportunity now to follow it through practically with this small amendment. I am happy to withdraw it if he wants to consider it and table it as a Government amendment on Report. I want to make it more of a level playing field for students and landlords, so they know exactly what they have to do and it is the same wherever they live. I do not think there is any risk to the Government from this amendment. It is a simple, practical measure.

To be clear about the number of people that it would affect: only 33% of non-EU international students live in a hall of residence in their first year. So the majority of non-EU students live outside halls of residence and will have to circumnavigate the complex landlord measures that we touched on earlier.

Julian Huppert (Liberal Democrat, Cambridge)

I will be brief. I agree in principle with much of what the hon. Lady is saying. The message that has been going out from this country for a number of years is putting people off. I know that Ministers try valiantly, but it is partly due to the spin put out and it is also due to people such as the shadow Home Secretary when she tries to clamp down on student visitor visas. That sends out a message that hits our economy—on Second Reading, I spoke about the concerns that have been caused among English language schools in my constituency.

However, the hon. Lady’s principle is correct. We must ensure that the process is simple and clear for students and does not cause too many problems. She is also right to say that not all students live in halls of residence. A number of spaces regularly used as student accommodation would not count as halls of residence. I look forward to hearing from the Minister how all these people are actually caught.

The hon. Lady is right about trying to ensure that the process is speeded up so that people can apply from overseas. I agree with much of the principle of what she said, but I do not think that her amendment quite does the right things, although she acknowledges that it was intended to be probing. A criticism I made of one of my own amendments, which we will discuss later, is that some people are studying but are not in either visa category. I make the same criticism of her amendment as I do of my own—I did not realise my mistake.

The issue that the hon. Lady is raising is very serious, and I hope that we hear more about how we can ensure that the provisions do not hit students who are allowed to be here. They should be able to get accommodation relatively easily and should not suffer any of the problems many of us are concerned about. I congratulate the hon. Lady on raising the issue, because it is useful to discuss.

Norman Baker (Liberal Democrat, Lewes)

For the record, the number of university students from overseas is going up, so we are being successful in attracting more students to our universities. That is a good thing, and it shows that Britain is indeed open to students from abroad.

Meg Hillier (Labour, Hackney South and Shoreditch)

On the issue of the figures—forgive me, I do not have them to hand—what the Minister says is not strictly accurate. The number of early Oxbridge entrants and people coming to study for medical degrees such as dentistry has gone up by 10%. That was picked up on Second Reading, and the Minister’s office has been in touch with a colleague of mine to clarify that. The total number of international students in this country is up 1.6%, but that is not those newly arriving, it is the total number of students studying. There has actually been a net fall of 0.4% in the last year for which we have figures, which is the year before the last financial year.

Norman Baker (Liberal Democrat, Lewes)

I was quite careful in what I said, which was that the numbers of university students are up. We can check the records, but that is my understanding.

The hon. Lady asked about the difference between halls of residence and other accommodation. Educational institutions already have to check the immigration status of students they accept on courses that they offer. Where such institutions offer accommodation in halls of residence, it would not make sense to require students to evidence their immigration status again to the same people for a different purpose. That would obviously be disproportionate, which is why exemptions are being provided for halls of residence. Incidentally, the framework for that is linked to the one used for exemptions from council tax and rates.

In contrast, students who rent accommodation in other types of premises will not necessarily have a pre-existing relationship with a landlord. They might group together to rent premises under one residential tenancy for a house or flat. They might rent a room in a house-share with non-students. Their liability for council tax and rates will depend on the nature of the rental agreement. As a result, there is no uniform approach to the checks a landlord will make regarding an occupant’s student or immigration status. In such circumstances, it is right to treat a student like any other tenant and require them to prove their entitlement to rent. Landlords must obviously be certain about the checks that they must undertake in line with the proposed legislation.

If the amendment was made, a landlord would be required in any case to undertake a check of some description before letting to a student, as they would need to be satisfied that the tenant was a student and therefore that they could rely on the exemption. It could be argued that they would not have to undertake any repeat checks, but on the basis that student accommodation is likely to be let in line with the academic year, it is not clear what value the amendment would have for students.

We would expect every student to have a biometric residence permit, so it could be argued that it is easier for students to demonstrate their immigration status than it is for many other people. It is already standard for many landlords to ask for the proof that is readily available from students who want to rent their properties. The amendment would not achieve very much because landlords still have to check whether someone is a student—a landlord has to establish eligibility whether the person is a student or someone else who would not be exempt under the amendment. Students demonstrate their eligibility using a simple biometric residence permit. I have also indicated why it is right to separate halls of residence from private accommodation.

Lastly, I am advised that some other EU countries have duties on landlords to check the immigration status of tenants. Under such circumstances, I trust the hon. Lady will withdraw her amendment.

Meg Hillier (Labour, Hackney South and Shoreditch)

I am disappointed with the Minister’s response because my intention was to give practical force to the statement from the Minister for Immigration that Britain is open for business to students. That is a great shame.

I will return to the amendment on Report, and no doubt colleagues outside of the Committee will lobby the Minister for Crime Prevention after picking up on our discussion and will try to persuade him that the current measure is impractical and does not send out a positive message.

Norman Baker (Liberal Democrat, Lewes)

Does the hon. Lady accept that a landlord has to check every single person who wants to rent their property, in line with legislation, and at that point they will discover whether someone is a student? What advantages is she seeking to achieve?

Meg Hillier (Labour, Hackney South and Shoreditch)

We seek to achieve a simpler approach. Halls of residence are exempt, and I want to include in that exemption landlords who regularly supply accommodation to universities. There are such landlords in university cities across the country—I am sure the hon. Member for Cambridge, who represents a university city, has direct examples of this—who have a relationship with a university but are not a hall of residence. They are not big landlords who provide one of those big, modern, private halls of residence, such as those in Hoxton in my constituency, that are not attached to a particular university. That is the bit that is missing. Some 66% of non-EU students live in such properties and are outwith the measure.

As the Minister is still having a discussion, I live in hope that he is changing his decision.

Norman Baker (Liberal Democrat, Lewes)

A landlord has to check everyone anyway. Is the hon. Lady suggesting that landlords asking students to produce their biometric residence permit will somehow dissuade people from coming to this country? Is that what she is arguing?

Meg Hillier (Labour, Hackney South and Shoreditch)

No. The Minister is now obfuscating. He knows exactly what I am asking. The amendment is clear. He has made his intentions clear, but I will continue to probe the measure and hope to bring the amendment back on Report.

I beg to ask leave to withdraw the amendment.

Clause 16 - Persons disqualified by immigration status or with limited right to rent

Pat McFadden (Labour, Wolverhampton South East)

Before the Committee decides on the clause, I have some questions for the Minister.

I draw the Committee’s attention to my entry in the Register of Members’ Financial Interests, as I have a rented property. I am grateful to the Independent Parliamentary Standards Authority for helping to bring about that situation.

The clause will disqualify people from renting accommodation if they have no right to do so. The thread running through the Bill is apparent in subsection (2)(a), which says that a person does not have a right to rent if he or she

“requires leave to enter or remain in the United Kingdom but does not have it”.

That sounds pretty clear, on the face of it. As I understand it, the policy intention of this clause and many later clauses is that someone who requires leave to remain but does not have it will be prevented from building up the layers of a normal life, such as tenancy, access to health treatment, a bank account, a driving licence and so on.

The Minister may not be surprised to hear that my question is on the definition and on the ability of those required to police the provisions to see clearly one side of the line or the other. The situation may seem to be black and white—someone either has leave to remain or they do not—but my experience as an MP is that it is not black and white. I asked the Minister for Immigration about that in the oral evidence session last week, and I want to probe the replies he gave me. I do not seek to make a partisan point here about the way the Home Office is being run, because these problems have gone on for a long time. I am talking about the long-term performance of the Department over the course of the Government that I served in and the current Government. My contention is not that it is all the current Government’s fault, but the problem has not been fixed in the last three years either. These problems continue.

I assume that the Minister for Crime Prevention will reply. His ministerial colleague told me last week—I paraphrase and I stand to be corrected—that if someone had been refused leave to remain but had another application in the system which was lodged within the correct time, legally speaking they were entitled to stay in the country at least until that application was judged one way or the other. The same applies—again I have many constituency cases like this—if someone has made several applications over a period of years, they have been refused and have been through appeals process and there are now new applications. As I mentioned before, time scales of a decade or more are not rare. I do not know how common they are across the country but they are certainly not rare. These are not a few, isolated cases of someone on the outer fringes of the immigration system. There are many cases like this.

First, how many outstanding applications which have not yet been judged are in the system? If the Minister cannot tell me today, could he write to the Committee? That will give us some idea of the scale of what landlords and others are expected to judge. If the people in the system are legally entitled to be here in the eyes of the law and the eyes of the Government, how is the landlord expected to know that and to check that? We heard from one of the representatives of the landlords that there are to be 10 people employed in the Home Office to help with this. Could the Minister confirm that?

I return to the answer given by the Minister for Immigration last week. He described what a landlord should do if they were in doubt because someone had an application somewhere in the system. The papers that my right hon. Friend the Member for Delyn read out earlier, such as the various temporary leave to remain documents, passports, birth certificates and so on, are often lodged with the Home Office and can be kept for months or years. They can also get lost by the way; that is not rare either. How is a landlord supposed to judge this? The answer that the Immigration Minister gave me was that they had to phone one of that small number of people—he will confirm whether it is 10—and they would get an answer within 48 hours.

I am not being flippant when I repeat the question I put to the hon. Member for Cambridge earlier: how can we expect a Department which cannot reach a definitive answer over a period of 10 years to reach one in 48 hours? That is stretching credibility beyond the limits. I am not convinced, to put it mildly, that this will work. I have many cases where we go back and forward trying to get final answers to lengthy cases that go on for a long time. There is voluminous correspondence. Yet he expects us to believe that suddenly 10 people working on housing will be able to decide these cases within 48 hours. I do not think these 10 people will be miracle workers. If that is really the position that Ministers are putting these 10 people in, they should pause and consider the burden that they are putting on them.

Is that the expectation that we as Members of Parliament are going to be given, that if someone who has been in the system for a long time suddenly applies for a tenancy, they can expect an answer one way or another about their immigration status to be given to their prospective landlord within 48 hours? I honestly think that that runs against all the experience that we have—certainly, that I have—as constituency MPs of the amount of time such cases take.

I might sound as if I am beating up on the officials too much, but I am not. As we have said during previous discussions of the Bill, it not always the fault of officials when cases last for 10 years; sometimes the applicants are continually looking for new grounds on which to put in applications, and officials who probably think they have dealt with a case suddenly find themselves facing a new application on new grounds. It is not always the fault of the officials, but it is a lengthy process.

Aside from the questions of how many claims are lodged in the system and how many staff there are to help landlords, we need an idea of the process for landlords. The likelihood is that they will find themselves asking prospective tenants questions and getting answers that they do not quite understand. Someone is going to say to them, “I don’t have leave to remain, but I have an application in with the Home Office.” How are landlords expected to judge in those cases and what will the consequences be for the potential tenant? I cannot judge whether a tenant should be here, or whether their application is valid; that is for the system to judge.

The point I am really raising here is that the practical applicability of the clause and of other measures in the Bill runs up against the Department’s ability to decide speedily on immigration applications. We have a policy intention that does not sit easily with our experience as constituency MPs of the way in which the Department charged with implementing and policing that policy intention operates in reality.

The policy intention is to make sure that a clear line is drawn, and that there is access to services for people who are legally here and no access for those who are not. However laudable that may be, if in practical terms that line cannot be drawn cleanly and quickly, people will conclude that the Bill is a political pose rather than a real attempt to implement a change in policy. The Government have a problem: they have to make the policy stick against the reality of the experience that we as constituency MPs all have of trying to get clear, quick answers from the Department—and indeed, when refusals take place, of trying to follow that up with the actions that should happen at that point, because if somebody is not entitled to be in the country, they should not be allowed to stay for a long time after the decision to refuse their application, but I am afraid that that also happens at the moment.

I would therefore like the Minister to answer these questions. How many applications are currently lodged in the system without decision? How many people will be working on this area? Does he really expect us to believe that the 48-hour time scale for getting clear answers can work?

Norman Baker (Liberal Democrat, Lewes)

I thank the right hon. Gentleman for putting his case so lucidly. The first thing he has done is demonstrate that the immigration system at present is not perfect and requires amending to make it work more effectively. That of course is the purpose of the Bill. It is true that there has been a situation whereby some people have been able to put in multiple appeals and, in a sense, to game the system, and have stayed in the country for a long time. It is also true that over a period of time, the system for removing people who should not be here has not been as efficient as it should be. He is perfectly right to draw attention to an historical problem that remains a problem to some extent now.

There is still a backlog now. It is perfectly true to say that. The Bill is partly about dealing with that backlog—for example, by reducing the number of appeal mechanisms —to try to make the system fair but workable in a way that it has not been to date.

The right hon. Gentleman asked whether people who have been refused leave to remain are entitled to stay in the country. If they have an in-time application that is valid, they can exercise that right. I cannot answer his question about how many outstanding applications there are today, but I will write to him to give him that information ahead of Report.

The right hon. Gentleman asked whether the 48-hour process could work properly. First, every single person who wants to rent a property will not present a problem to landlords. The vast majority will have clear documentation making entitlement apparent to the landlord—whether a UK or EU passport, a biometric residence permit or whatever. We are talking about a minority of people wanting to rent who will cause landlords a problem.

The Home Office will provide three facilities to help: first, online tools for landlords, so that they can research the matter themselves, if they wish to do so; secondly, guidance to landlords; and, thirdly, as the right hon. Gentleman mentioned, the telephone advice and assistance service, whereby tenants and landlords can verify a right to rent or otherwise, with a response in 48 hours. He doubted whether a response would be forthcoming in that time, but, as my hon. Friend the Member for Cambridge said earlier, if the Home Office does not get back within 48 hours, landlords have discharged their responsibility and they then have the unlimited right to rent—for a year, I think—to that tenant in such circumstances.

Pat McFadden (Labour, Wolverhampton South East)

Does that not expose a gaping hole in the Minister’s policy? If the Department cannot answer the question, the person will be deemed to be allowed to stay. That seems to be a pretty big admission of the potential weakness.

Norman Baker (Liberal Democrat, Lewes)

I do not agree. If there is a gaping hole, it is one we are trying to close by using the terms of the Bill to deal with the immigration system.

David Hanson (Labour, Delyn)

My right hon. Friend the Member for Wolverhampton South East has pressed the Minister strongly on that point and, to back him up, I want to know what the resources are to ensure an effective response within that 48-hour period, even on a pilot. If a landlord phones the Home Office and it does not determine the issue within 48 hours, the landlord is discharged and there is that big hole in the back door. What resources are in place for the pilot/phased roll-out and what resources does the Minister expect to put in place for any definitive scheme in due course?

Norman Baker (Liberal Democrat, Lewes)

We expect to put in place the resources that are necessary to deliver the policy that we have set out—it is as simple as that. It will be possible to respond within 48 hours. As I said, the gaping hole that we are dealing with is one that, in a sense, we have inherited, but “gaping hole” is not an accurate description of what we are proposing now, which provides a defence for a landlord if there is no reply within 48 hours. I hope and expect that the landlord will get a reply, but if not, there is a back-stop defence for the landlord in that situation.

The service standard for the employer checking service, for example, is five days. At the Home Office, we meet that now, so if we can do that, there is no reason why we cannot meet the 48-hour target as well. The proof of the pudding is in the eating, which is one of the reasons why we are taking things slowly. There are all sorts of matters to be tested, and we intend to get them right. Our proposal is a sensible objective and one that we can meet. In such circumstances, I hope that the Opposition will accept the clause.

Pat McFadden (Labour, Wolverhampton South East)

I want to put it on the record that I find the Minister’s response unconvincing. On his comparison with the employer checks, what happens in practice is that people put in an application when they are out of time; over a period, the employer puts them under pressure—understandable, because the employer is under pressure from the Home Office to get an answer—and they come to our surgeries, so we then write to the Home Office to ask, “Can we clarify the situation?” That often happens with employer checks, so I am not sure that the process is working quite as seamlessly as the Minister thinks.

If the policy is to work, those questions of resources, speed and the ability of the Department to make the decisions in a clear and timely manner must be answered in a way that is significantly different from the past. I am afraid that we have not heard anything to suggest that that will be the case.

Norman Baker (Liberal Democrat, Lewes)

I have mentioned that the service standard of the employer checking service is already met. I also make the point gently to the right hon. Gentleman that requests are being satisfied in three days, rather than the standard five days, so we are ahead of where we should be. Furthermore, we are all constituency MPs and we all receive correspondence about immigration matters. What we bring forward as Ministers is coloured not simply by what our officials say but by what we see in our own postbags and at our constituency surgeries. We would not suggest legislation unless we thought it would be workable.

Finally, we are having a deliberately slow start with a pilot area or a roll-out, which means that a limited number of landlords will be engaged to start with. I am confident that the 48-hour period will work in those circumstances.

Clause 17 - Persons disqualified by immigration status not to be leased premises

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment 10, in clause 17, page 16, line 22, at end insert—

‘( ) A landlord is to be taken to “authorise” an adult to occupy premises in the circumstances mentioned in subsection (1) if (and only if) there is a contravention of this section.’.

Katy Clark (Labour, North Ayrshire and Arran)

With this it will be convenient to discuss Government amendment 11.

Norman Baker (Liberal Democrat, Lewes)

The Government has looked carefully at concerns raised by interested parties about the provisions in the Bill and, having considered the issues, we tabled the amendments to provide clarity for landlords and their agents. The Residential Landlords Association referred in evidence to its concerns about the potential for the provisions to create a general legal prohibition with unintended consequences, such as the potential for some to argue that any rental agreement is invalidated. As the association mentioned in its evidence, the Government had already taken those concerns on board and we were prepared to make the amendments. On 28 October, my hon. Friend the Minister for Immigration wrote to the association and other landlord representative bodies to share that news. I am not sure whether hon. Members have seen it, but they are welcome to do so.

Amendment 10 makes it clear that the restriction set out in subsection (1) will be broken only in the circumstance set out in the clause, and a breach cannot arise in any other way. The intention is to provide reassurance to landlords that, provided they comply with the steps set out in the provisions, they will not risk inadvertently breaching the restrictions in any other way.

Amendment 11 clarifies and confirms that the restriction in the clause is not intended to affect the validity or enforceability of any provisions of a residential tenancy agreement. A breach of the prohibition in the clause will not impact on a landlord’s or tenant’s ability to enforce any provision in the agreement that they have entered into. I hope that my explanation has clarified the matter.

Clause 19 - Excuses available to landlords

Meg Hillier (Labour, Hackney South and Shoreditch)

I beg to move amendment 52, in clause 19, page 18, line 9, at end insert ‘or

(c) an “in time” application for leave to remain has been made and the agent has secured—

(i) a letter confirming the application from an accredited legal representative, and

(ii) proof of delivery.’.

Katy Clark (Labour, North Ayrshire and Arran)

With this it will be convenient to discuss amendment 53, in clause 21, page 19, line 18, after ‘into’ insert ‘or

(b) an “in time” application for leave to remain has been made and the landlord has secured—

(i) a letter confirming the application from an accredited legal representative, and

(ii) proof of delivery.’.

Meg Hillier (Labour, Hackney South and Shoreditch)

The amendments are important to people who are legally here. I have touched on the relevance of this matter to my constituency, where it is a big issue. People who have finished a period of leave to be here or whose visa has expired may reapply and have to wait for the result. There is a mechanism for employers to check that someone has the right to remain and it is worth rehearsing the approach for the Committee.

First, the person applies up to one month before the leave or visa runs out. They cannot apply before that, but must do so a maximum of one month before and a minimum of a few days before. They must ensure that all the relevant paperwork has been done, that the money is in their account and so on. Two weeks after the application has been made, the employer—who at that point would be employing the person legally, because they had employed them while they had leave to remain—can write to the Home Office on a form that they have to find on the Home Office website. The Home Office then responds to confirm whether a new application has been made. At that point, if the employee is there, the employer is either covered for the requisite period of a year or not.

It could be a month after someone is employed—or longer, because they might have been employed a few months before their leave ran out—that an employer finds that somebody is no longer here legally. They find that the employee has been pulling the wool over their eyes—they said that they had put an application in, but had no intention of doing so—and they are employing somebody illegally and will have to sack them.

Take that scenario and apply it to a tenant who applied four months before their leave expired. They cannot apply for a new visa or for new leave until a maximum of one month before their leave expires. What is the landlord supposed to do in that situation? Do they give a four-month tenancy? That is not possible in law; it has to be a six-month tenancy. Do they not let the property to the individual, because they are nervous about what the position will be? Whatever the code of practice is supposed to state—it is so badly worded that it gives landlords the right to do pretty much anything—and whatever is said about equality, there will be real, practical issues for landlords and letting agents when deciding whether to let a property.

There might be a different approach. I want the Minister to be clear about what can be done. Interestingly, in the Public Accounts Committee yesterday, the permanent under-secretary at the Foreign and Commonwealth Office referred to the passport pass-back service that is being piloted for business visa applications. Many of my constituents who apply—they put in all their paperwork and their documents—do not get anything back until their application is agreed. It seems they will be treated less well than the high-level business people in the pilot scheme. I am not saying that the scheme can be rolled out immediately, but what about everybody else who lives here? Their lives are on hold as a result of complying legitimately and properly with immigration rules, and reapplying for a new visa or an extension of their leave, but their paperwork is held, as my right hon. Friend the Member for Wolverhampton South East outlined. As far as the relationship between tenant, landlord and letting agent is concerned, that is entirely impractical.

The time scales involved and the uncertainty will increase discrimination against people who have complicated lives. Other people have complicated lives, too—we have touched on some of those issues—but I am talking about foreign tenants who will not necessarily be granted a tenancy. Although the periodic checks theoretically provide some protection, I am not convinced about them in this case; perhaps the Minister can clarify. Even if the landlord let the property, they could end up with a void if they found that the person had not made an application. They would have to evict them, and that would cause problems, as outlined by some of the landlord organisations in the evidence sessions.

The Home Office already issues temporary residence permits. I have a constituent who is fighting a custody case and has been given repeated three-month temporary residence permits so that they can be available whenever the court hearing, or series of court hearings, happens, so a mechanism already exists. It is quite cheap and easy to do and would transform the day-to-day lives of my constituents. It would make a huge difference. I cannot think of any argument for not introducing the temporary residence permit approach for all applicants. Also, to refer back to the comments of my right hon. Friend the Member for Wolverhampton South East, it might massively improve the Home Office system overnight, but that is probably less likely.

When someone applied to extend their leave legitimately, as either a stop-gap or a permanent arrangement, within a couple of weeks it would be very easy to issue a temporary residence permit to cover perhaps two or three months. Indeed, it might spur on the Home Office machine to move quickly to make a proper decision on that person’s case by the end of that period, which could be two, three, or six months. The Minister could make that judgment and whip his Home Office machine into action to deliver on it.

In the meantime, it would be good if the Minister looked into such an approach. Landlords would have an easier time, and anyone else needing to see evidence would find it easier. The reality on the ground for people in my constituency is exactly as my right hon. Friend the Member for Wolverhampton South East described. People turn up with a tatty bit of paper from the Home Office that says they are allowed to work. Landlords and others—and particularly employers, in my experience—do not necessarily believe it. As the Member of Parliament for that person, I then have to chase up on their status, which is a very slow process. I advise constituents to wait at least two months to hear back from the Home Office, but frankly, although I do not wish to be dishonest with my constituents, I am more hopeful than realistic in saying that. Very often it takes longer just to get a simple answer back on status. We then have to get a further letter issued by the Home Office, again on a bit of paper that is not that secure. A biometric residence permit for a short, limited period of time would cover this gap in the Bill but also transform the lives of so many of my constituents who are caught in this never-never world of not being quite one thing or another.

In the world we live in, where we have to prove our identity for so many things, having that little bit of plastic would make the lives of legitimate people who are applying legitimately within the system a lot easier. Picking up on what the Minister for Immigration said earlier, it would also advertise that Britain is open for business and welcomes people who are prepared to play by the rules and go through the immigration system.

If the Minister for Crime Prevention does not wish to accept the amendments, and this particular proposal, will he explain how the Home Office 48-hour hotline will work? There was some attempt to answer that after comments made by my right hon. Friend the Member for Wolverhampton South East. However, I think there are real issues there. Once an employer has sent off a bit of paper, it takes a couple of weeks for it to go backwards and forwards, so I am not convinced that in that in-between period, someone would be able to get an answer out of the Home Office in 48 hours. If this were ever to go beyond a pilot, the deluge of people seeking that information would be enormous and potentially flood the system. I am not convinced that the Home Office machine is capable of dealing with that.

I have made what I hope are positive suggestions that would not only help with the Bill but would have a wider application. I would be the first to congratulate the Minister if he were to adopt the proposal to provide temporary biometric residence permits for those playing by the rules who wish to ensure that they are here legitimately, but who are caught in that period in which the Home Office is unable to resolve their case quickly. This is a sensible suggestion that I hope the Minister will consider; if he does, there will be no need to press the amendments to a vote.

Norman Baker (Liberal Democrat, Lewes)

First, on the 48-hour hotline, I hoped that I had reassured Members during our previous discussion that we are confident that it will work properly, particularly given the limited geographical area covered by the proposal in the Bill, until it is reviewed.

Meg Hillier (Labour, Hackney South and Shoreditch)

I should perhaps have asked the hours of operation. The employers’ hotline works from 9 o’clock to 5 o’clock, but if one rings it at five minutes to 5, in a bit of mystery shopping, it is never answered. Those are quite limited hours. Does the Minister have any thoughts on how the landlords’ hotline might work?

Norman Baker (Liberal Democrat, Lewes)

That has not been decided yet, but I would not expect people to work at 3 o’clock in the morning answering phone calls. As I mentioned, we are talking about a limited geographical area, and I do not anticipate the dangers and difficulties that Opposition Members appear to think are inevitable. I remind Members that the average performance turnaround time for the employer checking service is not weeks but three days at present, so we are managing that quite well at the moment. If landlords ring this line, they will get a clear answer. They will be told—yes or no—whether this person is able to rent a property under the rules. They will not get ifs and buts; they will get a clear yes or no.

Meg Hillier (Labour, Hackney South and Shoreditch)

To clarify, I was not talking about the main employer checking line, which deals with someone who has produced paperwork that can be checked to see if they are legitimate. I am sure the Minister is honest and trustworthy in his comments on the performance of that. My point is about the people who fall between. They are legitimately here and need to renew their leave or their visa. They apply to do that, and there is a time-lag. There is a two-week delay before an employer is able to write to the Home Office to check that the application has been put in. It is those people who will fall between the stools in the Bill, as in so many other areas of their life.

Norman Baker (Liberal Democrat, Lewes)

As I mentioned, we are confident that the 48-hour system will work. If landlords do not get a reply in that period, they are covered to allow the property to be rented out. It is as simple as that. The dangers of weeks of delay simply do not occur in this case.

I want to pick up on one further point that the hon. Lady raised about length of leave to remain in different circumstances. The landlord’s responsibility is to ensure that someone is legally able to rent a property at that particular point. Whether that leave exists for a further three months, six months or whatever is neither here nor there; it is simply about whether they are entitled to rent at that particular point. The landlord is not obliged to do anything else until a year has passed, when he or she will then make a further check, if that person is still in the same rented accommodation. It is not an incentive to have three or four-month rental agreements. There is no reason not to have a year’s rental agreement, if that is what the landlord wants.

Let me give the hon. Lady some good news; I hope that she will welcome it. We recognise that there are legitimate concerns about some of the issues that she raised, so in relation to migrants with limited leave, we propose amending the process for extending leave so as to allow migrants to retain their biometric residence permit; the right hon. Member for Wolverhampton South East made that point. When leave is still extant, that could be taken as evidence of a limited right to rent, and a landlord need not conduct a further check for a year. To help further, we intend to allow the use of expired passports where they contain a relevant immigration stamp and an identifiable photograph. I hope that with that good news, the hon. Lady will be happy to withdraw her amendment.

Meg Hillier (Labour, Hackney South and Shoreditch)

I think that what the Minister is saying might be good news, but I am not entirely clear. Can he clarify how it will help an individual if they hold on to a biometric residence permit with an expiry date? It has expired; that is the key thing. A landlord or an employer would not take that as information proving that someone could stay in the country, although I see the point about passports, which certainly is a welcome move. Will it apply to everybody with limited leave to remain in the country, or only those applying for a tenancy? Is it a blanket change of policy by the Government, and when will it be introduced?

Norman Baker (Liberal Democrat, Lewes)

It will apply to everybody, and I think it will make a difference. That is why we are doing it. As for when it will be introduced, we do not yet have a definite date, but I will happily advise the hon. Lady when we do.

Meg Hillier (Labour, Hackney South and Shoreditch)

On the point about the biometric residence permit having expired, what other comfort will a landlord or employer need in order to be sure that a person can stay longer? I am not entirely clear. Perhaps I should rehearse the scenario. I apply to extend my leave. I am allowed to retain my residence permit, if I am a foreign national. Let us say, for argument’s sake, that the residence permit ran out on 31 October; this is 7 November. I go to my colleague and ask to rent a property or get a job. They look at my permit and say, “But it ran out on 31 October.” I say, “Ah, but I’ve applied to the Home Office for further leave.” What must I also provide along with that residence permit to prove that I am legitimately, legally in the country and going through the proper application process? Forgive me, Ms Clark; this is an important matter to many of my constituents, and clarity would be helpful.

Norman Baker (Liberal Democrat, Lewes)

I hope that I have given some clarity. I am not sure that that situation will be an everyday occurrence throughout the country, or at least throughout the geographical area where we are seeking to try out the scheme. Of course, it is not simply the landlord who can ring the Home Office. If the landlord rings the Home Office, through our 48-hour system, that is a fail-safe check by which they can find out whether it is right to rent out a property.

Equally, the tenant or prospective tenant can also ring the line and establish their status at that point. The unique number on the biometric residence permit will help link the person swiftly and accurately to the records held by the Home Office, so that a quick check can be made and a quick answer given to either the tenant or the landlord. I hope that the situation will be relatively rare, but there is a way to deal with it quickly, as I have explained.

Meg Hillier (Labour, Hackney South and Shoreditch)

In that case, I will withdraw my amendment. I look forward to getting further clarification outside the Committee about exactly how the process will work, and I will be following it closely in practice to ensure that what the Minister seems to be promising is delivered. It is a step in the right direction. I beg to ask leave to withdraw the amendment.

Clause 24 - Objection

David Hanson (Labour, Delyn)

I beg to move amendment 27, in clause 24, page 21, line 42, leave out paragraph (c).

Katy Clark (Labour, North Ayrshire and Arran)

With this it will be convenient to discuss amendment 28, in clause 24, page 22, line 7, leave out paragraph (b).

David Hanson (Labour, Delyn)

I hope that we can deal with the amendments relatively speedily. Clause 24 deals with objections that a landlord may make if they believe that they are not liable for a penalty; that they are excused under the clauses that we have just approved; or that the penalty is too high—the Government can affix a penalty of up to £3,000.

The grounds for objection are clear. A notice of objection may be given under the clause. The key issue, which both amendments deal with, is the Secretary of State’s response to an objection. According to subsection (5), she may do four things:

“(a) cancel the penalty,

(b) reduce the penalty,

(c) increase the penalty, or

(d) determine to take no action.”

Through the two amendments, I want to test what would happen if we deleted subsections (5)(c) and (6)(b), which deals with increasing the penalty. I believe that the subsections will create a perverse disincentive to appeal for people who feel that they have been wronged. If an increased penalty is possible—I suspect that that is the Government’s intention regarding penalties issued by the Secretary of State for breaching the clauses we have previously agreed—some landlords, even though they might believe that they have a reasonable case, might not wish to take the risk of appealing.

Subsection (5) provides the three options of cancelling the penalty, reducing the penalty, or determining to take no action. If, however, the penalty was set at the relatively low figure, under the regulations, of £250, a landlord could, on appeal, face a penalty of up to £3,000, even though they might have perfectly good grounds for making that appeal under subsection (1)(a) to (c). That is perfectly reasonable, but given the complexity regarding the penalties faced by landlords, which we have discussed, I want to test the Government’s logic in wishing to have an option of increasing the penalty on objection, rather than simply having the fairness of the penalty reviewed by the Home Office, as should normally happen under any appeal system.

Norman Baker (Liberal Democrat, Lewes)

When a notice of objection is received, the Secretary of State will look at the matter afresh, as we would expect her to. She will establish whether the original decision was correct, doing so without assumption as to the validity or otherwise of the notice that was served.

In such a situation, it is entirely possible that new information will come forward, which may alter the decision in the way described under clause 24(5). It may be considered appropriate to cancel the penalty or to reduce it based on mitigating factors, but it is also possible that there would be aggravating factors that had not been taken into account. If new information comes forward that demonstrates that, for example, the mistake was not innocent, but some sort of connivance was involved, suggesting that the penalty should be higher, it seems only right, as a matter of principle, that someone looking at the issue afresh should take that into account and reach a conclusion accordingly.

The situation is not unusual. The approach mirrors that taken in civil penalty schemes in relation to the employment of illegal workers under the Immigration, Asylum and Nationality Act 2006 and under the UK Borders Act 2007 regarding biometric registration.

It is not unusual in the courts for someone’s sentence to be increased or reduced. That ability exists. If I think back to my previous Department, when bus operators appealed to the Transport Secretary about the allocation of bus service operators’ grant by local councils, it was open to the independent adjudicator to increase the amount that bus companies got or to reduce it.

The principle that someone reconsiders something on the basis of looking at all the evidence is sensible. If they do so under those circumstances, they should take into account any mitigating factors that are put forward and also any aggravating factors that may not have been known about when the original decision was taken.

David Hanson (Labour, Delyn)

I am grateful to the Minister for that explanation. I have received representations from outside the Committee on those matters. I wanted to test the Minister. I beg to ask leave to withdraw the amendment.

Clause 26 - Enforcement

David Hanson (Labour, Delyn)

I have a simple question, which I helpfully trailed earlier in our discussions, about the devolved Administrations. It relates to subsection (6). Any money collected under any finally rolled-out, phased, post-pilot scheme that is implemented is paid to the Secretary of State by way of a penalty and must be paid into the Consolidated Fund, which is the UK Government reserve.

I accept that these are relatively small amounts of money, but the principle I want to establish is that costs are incurred by devolved Administrations—the Scottish and Northern Irish court systems are accountable to Scotland and Northern Ireland—yet any money raised is put into the Consolidated Fund in the United Kingdom. Have the Ministers accepted that point? Can they at least examine it in conjunction with the devolved Administrations? It seems a perverse unfairness that one body—not the UK Government—spends money enforcing, but another body receives the proceeds of that enforcement.

Norman Baker (Liberal Democrat, Lewes)

We touched on this earlier, as the right hon. Gentleman will recognise. First, if the devolved Administrations want to make representations on this or any other point to do with the Bill, we will consider the matter carefully and engage with them productively, as we always do.

Secondly, if the number of people who should not be in this country is reduced, that potentially represents a saving not just to the UK Government but to the Administrations. Thirdly—I have to make this point—matters to do with the Consolidated Fund are matters for my fellow Ministers in the Treasury. They tend not to like Ministers in other Departments making up policy for them.

David Hanson (Labour, Delyn)

But does the Minister accept that the costs of enforcement fall on the Scottish Parliament and the Northern Ireland Executive in two of the three cases outside England and that the fees paid will come to the Treasury? Does he accept that basic principle?

Norman Baker (Liberal Democrat, Lewes)

I accept that this is a reserved matter and most of the costs will fall on the immigration authorities, which are UK-based. If the devolved Administrations want to make out a case that they have a cost, we will look at that. But I have described the position at the moment. That is the proposal in the Bill. If the right hon. Gentleman wants to pursue it with my Treasury colleagues, he can do so. We will look at any representations we receive from the devolved Administrations.

Clause 27 - General matters

Meg Hillier (Labour, Hackney South and Shoreditch)

I beg to move amendment 56, in clause 27, page 23, line 43, at end insert—

‘(ba) the responsibility for agents to inform landlords, where the agent takes over management of the property, that an agreement should be made over the responsible party for immigration checks.’.

I move this amendment on behalf of my hon. Friend the Member for Glasgow North West. This is another issue about immigration checks and the relationship between landlords and letting agents. We have already rehearsed the arguments about the 404 documents that could be evidence of immigration status. The penalty of up to £3,000 is particularly high and requires a lot of work to avoid. There has been some acknowledgement that some of it is necessary, but I am not prepared to rehearse all those arguments.

Colleagues have already expressed concern that landlords and agents will simply discriminate between prospective tenants. Ethnic minorities already find it difficult to rent housing and they could be further discriminated against. We know that demand for rental properties is going up. Certainly in my constituency, it is a very big issue as more people face a cost of living crisis and cannot afford a mortgage.

The ratio of applicants to every new property is 4.4:1. My hon. Friend tells me that demand is rising in Glasgow, with a 22% year on year rise in visitors viewing the Citylets website. That is not even an area such as mine in London, where we have a growing population and a shortage of properties; other parts of the country are affected as well. I am sure that colleagues have experiences from their constituencies.

All that means that landlords have the pick of tenants. I know from my own constituency that many young people end up being kicked out on a pretext by the landlord, because he has found someone else who can pay more rent. We know from our case load that, in certain parts of the country, there are more tenants than homes. What is to say that landlords will not take the easiest option, which is somebody with no immigration issues? We have already rehearsed some of the arguments about why it will be challenging to check, notwithstanding what the Minister says about his hoped-for 48-hour hotline, which I am rather sceptical about.

Many landlords own one property and pay lettings agents to manage it for them. Where a high proportion of people who are renting are migrants—London and Glasgow, to a degree, among them—lettings agents may take advantage of the Bill. That is the fear that the amendment attempts to address, because it is not specified whether the landlord or the agent is the default party in charge of immigration checks, and those checks are left for the landlord to undertake.

I ask the Minister directly: who would be responsible when no agreement has been made between the agent and the landlord? Anyone who has been through any lettings process, either as a landlord or tenant, will know that there is a range of different types of agreement, notwithstanding the law about shorthold tenancies. Agreements between lettings agencies and even estate agents, and landlords and tenants, vary greatly.

I have a number of young people in my constituency who are renting and have come a cropper. Their complaint seems legitimate, but what they signed was not worth the paper it was written on. They did not have the ability to go and get it legally checked, although there is much advice about that. In the hurry to sign up for a tenancy and when 4.4 people are chasing one property, the chance of someone who is inexperienced going and checking that everything is right with the citizens advice bureau or some other free legal advice is going to be slim. That is a reality for many of my constituents and those of my hon. Friend in Glasgow.

If no provision is made for agents and landlords to make an agreement, could landlords not be taken advantage of? It is pretty obvious that they could. We have had a lot of publicity about this; Members on both sides of the House have talked about rip-off lettings agents, and this seems to be another way in which lettings agents can rip off landlords.

Agents should be primarily responsible for informing landlords of this necessary check, so an agreement over who undertakes the check can be made. However, I and many other people have experience of obfuscation, downright lies, misinformation and information not being passed on by the lettings agents themselves or someone working for them. It is not a perfect system and the gap means that the landlord could be responsible for the inaction or poor quality checking by the lettings agents.

That adds to the administrative burden of the checks and it is likely that the cost of undertaking them will ultimately fall on renters. We have heard that point before, and I know that it is a concern for many of my private renters. In my constituency, there is a very good campaign called Digs, which represents private renters and raises many concerns about the impact of costs falling on tenants. As the tenant often has to pay the fee up front to the lettings agents, it seems that we should expect the lettings agents to do a proper job. Sadly, they do not and there is a big issue here for the landlords.

If the principle of the entire part on residential tenancies is wrong, that will add further confusion and cost to a market already out of control. I ask the Minister to make it very clear who is responsible. Is it always the landlord, because that is what the Bill seems to say? What safeguards can be put in place? If the amendment were adopted, it could ensure that if a lettings agent were negligent, they would bear the responsibility.

At the moment, there are many circumstances in which the landlord pays the agent; the tenant may pay the lettings agent; the lettings agent does not do their job properly; the tenant ends up having to move out or is evicted because they have not done their bit of paperwork correctly, perhaps because of their lack of knowledge; the landlord is fined for not having done things properly, possibly because they have been misinformed; and the lettings agent slips through the middle scot-free, with the money from the fees from both parties in their pocket. I recognise that this is not the Minister’s entire area of responsibility, but I hope that the Government will take the matter seriously, given the number of people who are now renting in this country.

The amendment is a proportionate way of doing things, but I will consider withdrawing it, and will be happy, if the Minister understands the seriousness of my point and redrafts the clause for Report.

Norman Baker (Liberal Democrat, Lewes)

It is clear: the landlord is responsible for complying with the Bill when it becomes an Act. The landlord can, if they wish, enter into an agreement with a lettings agency, or some other agent, who will then expressly have to—in writing, I would suggest—take on the landlord’s responsibilities; if a contravention took place, they would be held responsible. However, outwith such an agreement, the landlord would retain responsibility. If the landlord is badly advised by lettings agents, that becomes a matter that the landlord may or may not pursue in a civil case. However, the law is quite clear that a landlord is responsible for complying with the law, unless the agent has expressly accepted responsibility for doing so.

The code of practice that will be available will offer guidance to landlords and agents on how liability may be transferred, where there is a wish to do so, and on the issues that they may want to consider when entering into agreements. That would include guidance that will be in the interest of landlords and agents alike and good practice to ensure that any agency agreement clearly sets out the responsibility for undertaking immigration status checks.

We hope that most agents will discuss that aspect with the landlords as a matter of course in any event, but I want to make it clear that the backstop position is that it remains the responsibility of the landlord. I hope that that has been helpful in clarifying the matter for the hon. Lady.

Meg Hillier (Labour, Hackney South and Shoreditch)

I am a little disappointed that the Minister’s response was peppered with words such as “hope” and “should”. There is the Whitehall version of the real world, and the real world. The real world is a bit messier than Whitehall and the Minister would like it to be, because the reality is that we still have some way to go. At the moment, there are a lot of lettings agents out there who, frankly, are guilty of sharp practice or obfuscation. That issue has not yet been cleaned up or tidied up. There is a welcome improvement in including lettings fees in adverts for tenants for rented properties. Such steps are small, but in the right direction.

The Bill will deal with the real world. The issue concerns small accidental landlords. A lot of people in my constituency are renting from accidental landlords, who are sometimes people who move out of London for a career but are frightened to sell their home because of the property bubble—they do not think they could move back to London unless they keep it. There are legitimate reasons why they become landlords, but they may be sole landlords who put themselves in the hands of what they consider to be professional letting agencies. However, how are they able to determine that?

There is some responsibility on the Government corporately—the matter may not entirely be in the Home Office’s bag—to ensure that there is a better understanding. We can pass this law, but there are plenty of landlords out there who will not be aware of it, and plenty of lettings agencies that will just decide not to take it seriously. Frankly, the Minister is dodging the situation.

Again, I will take the amendment away and see whether it can be raised again on Report. I will withdraw it, but it is disappointing that the Minister is, frankly, so blasé about what could be a real situation—a well-meaning landlord trying to do the right thing could be fined a lot of money, or find themselves involved in a very long and complicated legal process, because an agency has not done its job properly. If the lettings agent was checking, they would risk being fined. Alternatively, there should be a written agreement, and provision for that should be included in the Bill.

I beg to ask leave to withdraw the amendment.

Clause 29 - Prescribed requirements

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment 12, in clause 29, page 25, line 4, at end insert—

‘( ) If the draft of an instrument containing an order under or in connection with this Chapter would, apart from this subsection, be a hybrid instrument for the purposes of the standing orders of either House of Parliament, it is to proceed in that House as if it were not a hybrid instrument.’.

The provisions related to landlords will be implemented on a phased geographical basis—however one wants to describe it. Parliament can allow review of the operation of the scheme to take place, to ensure that the measures are appropriately targeted. If, during that period, it is identified that it would be appropriate to exercise any of the order-making powers contained in this chapter in relation to one geographical area, pending anything else happening the future, the order is likely to be considered hybrid. If it was then subject to the affirmative order procedure, the hybrid instrument procedure would apply.

Although it is unlikely that such an order should need to be made, it is theoretically possible. The order-making power in clause 15(7) will allow amendments to be made to the exclusions set out in schedule 3. The exclusions will need to be closely considered during the initial period to ensure that they are appropriately targeted. Should amendments be required, it should be possible to make them quickly in the interests of persons living in the area affected. Amendment 12 will ensure that an appropriate level of scrutiny is applied should a statutory instrument need to be introduced. I hope that that is clear.

Clause 33 - Immigration health charge

Julian Huppert (Liberal Democrat, Cambridge)

I beg to move amendment 37, in clause 33, page 27, line 24, after ‘charge’, insert ‘for—

(i) holders of tier 4 student visas and student visitor visas;

(ii) a person who has made National Insurance payments for two financial years; and

(iii) other groups that the Secretary of State may specify in the order.’.

Katy Clark (Labour, North Ayrshire and Arran)

With this it will be convenient to discuss the following:

Amendment 57, in clause 33, page 27, line 24, after ‘charge’, insert ‘including but not limited to—

(i) applicants for a Tier 4 visa holding a certificate of acceptance of studies issued by an authority-funded educational institution; and

(ii) applicants for student visitor visas for a period longer than six months.’.

Amendment 58, in clause 33, page 27, line 34, at end insert—

‘“authority-funded” has the meaning given by Regulation 4(a) of the Education (Student Support and European University Institute) (Amendment) Regulations 2013.’.

Julian Huppert (Liberal Democrat, Cambridge)

We now move on to the issue of the immigration health charge. I will mostly be talking about exemptions to it. The issue of what is actually involved and how it differs from the current position has not been well discussed in the press. The evidence from our very first sitting was helpful and informative. It showed what the process is supposed to look like. I am sure the Minister will want to speak at an appropriate point about the effects that it will have on medical professionals. As I understand the proposals—there is clearly some further work to do to lay them out in detail—they will have no effect at all on any medical professionals dealing with people at a secondary level, because people coming to see them will be pre-vetted.

At a primary level, there will be a slight change to the process of registration, but there will not be other consequences for medical professionals. Some of the comments in the press that every single doctor will have to see passports on every single occasion are simply not right. I would be grateful to the Minister if he could clarify—I know it has been said before—that the proposals will have no effect on people’s emergency procedures or treatment for infectious diseases. Indeed, my hon. Friend the Member for Guildford ensured that HIV treatment was made available—[Hon. Members: “Hear, hear.”] It is always a good idea to defend the legacy of the Whip.

As I understand it, there are groups of people who perhaps should not be expected to pay the amount in question. My amendment involves two of those groups. I am delighted that the hon. Members for Hackney South and Shoreditch and for Sheffield Central (Paul Blomfield) have come up with an amendment about students that is almost exactly the same as mine—great minds, and all that—but I am also pleased I got my amendment on to the amendment paper before theirs. As I said earlier when commenting on amendment 59, moved by the hon. Member for Hackney South and Shoreditch, I accept that the situation with student visas is not quite as I have it in my amendment, as there are a number of students who are here on other categories of visa.

The amendment is technically flawed, but the first intention behind it is to deal with the issue of students and the health charge. A lot of work has been done on that by the National Union of Students; I have been talking to the NUS and also to the president of the Cambridge university students union, Flick Osborn. The issue is a serious one: how do we ensure that we continue to attract people to this country, and do not put further barriers in their way?

I am grateful that it has been agreed that the immigration health charge will be reduced to £150 for students, although I am not sure why it has gone down from £200 to £150, as normally these things are halved. The decision shows that there is sensitivity to the issue. Students are one of our best exports. We do fantastically well in this area, and I would like to ensure that we continue to do so. The problem arises because people have to pay the cost up front. Although that may not seem too bad for an undergraduate who comes here, let us say, for three years—they will be paying £450, which is not necessarily impossible—it will still put people off. It could be used by other countries in a campaign against people choosing to come here. We are seeing assertive efforts by other countries to attract students away from us, and they will pick on any aspect that they possibly can to do that.

Henry Smith (Conservative, Crawley)

Will my hon. Friend acknowledge that we are not sure that there is any other country in the developed world that offers unlimited free health care to overseas students, and that most students studying abroad are used to paying a fee to access public health services or else having to take out some form of insurance?

Julian Huppert (Liberal Democrat, Cambridge)

I cannot speak for every country. I think other European countries provide health care, but I believe my hon. Friend is right that non-EU countries require some form of insurance or other process. One can imagine a creative university saying, “Come here and for only £150 a year we will give you free health care”—it is not beyond the wit of a marketing department to come up with something like that—but equally it could be used by other countries as a way of attacking us. There is an issue of balance.

The situation becomes particularly acute when it comes to students with families and graduate students, in particular, partly because of the different fee structure for their courses. In the case of a graduate student who comes with their partner and two children for a four-year course—I assume that the partner and children would have to pay the full price, but I would be grateful if the Minister would clarify that point—I make the sum pretty close to £3,000. That is quite a large sum of money to pay up front for somebody starting a graduate course such as a PhD. The majority of PhD students will be coming on a grant that pays their fees and pays for living expenses, and students will not necessarily have that sort of money at the beginning of their course. That is a real concern.

I do not want to dwell on the issue. I know that the Minister has had a lot of correspondence from students who are pleased to see the reduction from £200 to £150 but would like to see us go further, to ensure that we do not jeopardise our efforts to attract students. Every barrier we put in the way will make it harder. Fairly or unfairly, other countries will use the levy to compete against us. I therefore hope that the Minister will respond to the concerns that a number of us share about what we can do to support students.

The other group of people that I touch on in my amendment is those who have come to this country on some sort of temporary visa who are also working and paying tax. I can understand the logic that it is not okay for people to come from anywhere in the world, and simply arrive on our shores and have free health care. I absolutely understand that; it has a cost implication and can cause problems. But if people have been here for a number of years and have been paying income tax and national insurance for a number of years—I accept that the national insurance principle does not work as well now as it used to—it seems somewhat unusual that we would also ask them to pay the levy on top. That adds an extra burden—it is a multiple payment step. Some of the people affected will be working in the NHS or contributing in a range of other ways, so it seems odd that, if somebody is paying their taxes into the public purse and has done so for a certain amount of time, we ask them for further money as well.

In my amendment I propose that there could be a test based on whether someone has paid national insurance for two years. I am not wedded to that particular definition—the amendment is very much intended to probe the issue—but it seems that there should be some mechanism for people not to have to pay the charge if they are contributing in the same way as people who live here. I do not know exactly how that could be done. One could imagine people paying the charge and reclaiming it at a later point if they have paid in a sufficient amount. That would seem a fair way of dealing with the issue of double charging, so I hope the Minister will look at it.

There is also the issue of whether there have been conversations with health insurers—I hope that there have been—about alternative mechanisms. For example, some countries say that all visitors must have health insurance, although I realise that that is hard to police. One could imagine saying that someone who has health insurance for the duration of their stay does not have to pay, because if they are paying for their insurance, they are therefore not making use of the NHS cover and should not have to pay. There are of course details to consider about how we would avoid people just cancelling their insurance policies after entry. That could be a problem.

One could imagine a business person coming from overseas and taking out private medical insurance. They might come here and pay national insurance, income tax and all the other costs of living here, as well as paying the health surcharge and for private insurance. It seems a bit much to be paying three times. I do not know what conversations there have been, but I hope that the Minister will reflect on the issues that I have raised. I hope that he will consider the issue of students—how we ensure that we stay competitive, whether there should be an exemption for them, or whether the provision should be scrapped completely. I hope that he will also examine the issue of people who may have been here for many, many years, paying their taxes into the system. Is it really right to ask them for a surcharge as well? I also hope that he will give us some clarity about interactions with health insurers.

Meg Hillier (Labour, Hackney South and Shoreditch)

The hon. Gentleman and I agree on a number of points. I am also grateful to my hon. Friend the Member for Sheffield Central (Paul Blomfield), who has been helpful in providing a lot of information when we were jointly drafting our amendments. Of course, he represents a university city and sees at first hand some of the benefits overseas students can bring to this country.

There are a number of issues that I would like to address. I will go through some of the headlines and then provide further detail about why the Government must think carefully about the mood music they are playing to the international student community about the value of coming to study in the UK and about the economic contribution students make. I will flag up some practical issues early on so that the Minister can perhaps get some inspiration for his response.

First, we must consider the cost of collecting the surcharge and the mechanism for doing so, which is not clear. It would be helpful to know whether the Home Office has made an assessment and worked with the higher education sector to see how practical it will be to collect the surcharge, because we must consider the administration cost. Presumably the universities will be expected to collect the surcharge and pass it on. I can imagine that there would be quite a lot of work involved in collecting the £150, and that the cost of collection would be almost akin to the amount coming in.

Secondly, why was that figure chosen? We have heard evidence from the medical profession that £150 barely covers the cost of a consultation with a GP, so it is an odd amount to choose. There is also the issue that the hon. Member for Cambridge raised about everything having to be paid up front. We will all have had students come to see us whose degree course or PhD has not worked out, and they may have paid up front for three or more years of residence in the UK.

The Minister will know about the issue because he was helpful in resolving a problem that I had involving international students. The licence of their college was revoked and they had to shop around to try to go somewhere else in the UK. In such a situation, a student may, through no fault of their own, have to do another course elsewhere, and one of the options is for them to study outside the UK. Will there be a refund for people who leave? Regardless of whether there is to be a refund, however, there are practical problems with people having to pay up front.

It is worth stressing that not every student who comes to this country is terribly rich. They have to have money to pay up front, but many struggle to pull that money together. There are certain regions of China, for instance, in which families pull together to ensure that one young person can study, and that young person gets the investment of the community. There is not a great deal of spare money. Many international students rely on their 20 hours’ work a week to hold body and soul together. We should not equate international students with the very rich.

There is a conflation of issues here. The Government have made much play of health tourism and the idea that people come here seeking particular health treatments—that they arrive as a visitor, pop into the GP’s, get referred for other care and get something cheaply that they would have to pay a lot for in another country. Students are not health tourists. They are coming here to study and, as a group, they are young and healthy.

If we are talking about who is paying and who is not, I am puzzled about why inter-company transfers are exempt. Some of the richest bankers in the world, for example, will come to the UK on an inter-company transfer and not have to pay the health surcharge. The Minister looks at me quizzically, but that is my understanding. It seems odd that such individuals, who could easily afford to pay more than the proposed surcharge, will not be surcharged but students will be.

We know that students are net contributors to the economy, and as the hon. Member for Cambridge and I said earlier, we must ensure that Britain is not seen as a less attractive destination for international students. As the offer to international students becomes less and less attractive, we will see greater enrolment in competitor countries—I have figures showing that potential risk.

The other question is where the money goes. It is not clear that the money will even go to the NHS. The GPs who provide consultations will not get the money, which would not cover their fee any way.

I will not detain the Committee too much longer, but it is worth putting on record what international students contribute to the economy. In 2011, a report by PA Consulting Group for Study London provided evidence of the contribution of international students to London’s economy. The quantifiable impact of eight Higher Education Funding Council for England-funded higher education institutions and private colleges is estimated to be £5.7 billion, supporting 100,000 jobs in London.

Oxford Economics carried out research much more recently, in January 2013—my hon. Friend the Member for Sheffield Central has a particular interest in this—on behalf of the university of Sheffield to assess the net contribution of international students to the Sheffield community. During the 2012-13 academic year, there were a total of 8,222 international students at Sheffield-based universities, and those students made a net total contribution to Sheffield’s GDP of £120.3 million. Of that money, the direct net benefit amounts to some £97.9 million, meaning that the injection of local funds by international students, primarily via income and subsistence spending in the local community, is considerably greater than their consumption of local public resources. It is important to show that balance in this debate.

Education is one of our best exports. People across the world want to come to British universities, and when they come they contribute to this country. They are not just taking from Britain; they are giving and spending. The figures show how much they are spending. There is a £22.4 million contribution to Sheffield’s GDP alone, net of costs. That is a considerable contribution to the city’s economy. I will not delay the Committee by reciting the contribution to university cities across the country, but international students make a considerable contribution to the UK.

There are other benefits, of course. Graduates from British universities work across the world, and they are ambassadors for our country. I have been to a village in Nigeria where the engineer who was trying to sort out the water pump system had studied in the UK and talked positively about Britain. The Prime Minister has been out to Nigeria, and we want to see much more trade between the UK and Nigeria. That is just one country where we see the benefits of having advocates for Britain who have had a positive experience of being a student here. The families of students visit, which generates tourism revenue. I have already covered a lot of ground on funding.

Health insurance is provided in other countries. In Australia it costs about £261 on current exchange rates for a minimal level of health cover. In New Zealand, the university of Auckland quotes health insurance cover for one year as costing around £300. In Canada and the USA, medical insurance is not required for a student visa.

Looking at the number of people attending university gives an interesting example of the importance of competitive advantage to the UK economy. That goes back to the point that I raised earlier with the Minister. In 2009-10, the UK’s rate of growth in international student enrolment was 10%. In 2011-12, the total number of international students enrolled at university—not necessarily new students—was up 1.6%. However, there was a 0.4% fall in new entrants, the first time the trend had turned for many years. Whatever the Minister says about making it clear that the Government want Britain to be open for business and for international students, the word is getting out and fewer people are coming to the UK.

By contrast, the US is going in the opposite direction, with a growth of 5.7% in 2011-12, as is Canada, with a growth of 9% in 2011-12. Those are our competitor countries. One policy alone does not do it—it is about the mood music on a number of things, such as making people go through more hoops to rent a property and making them pay the health surcharge.

Looking at the impact of students on health systems, we see that not many students access health care. They are on the whole a healthy bunch of people. They are very young and they mostly do not have dependants, so they are not bringing their family into the picture. We see clearly that they are not the people—[Interruption.]

Katy Clark (Labour, North Ayrshire and Arran)

Order. Will hon. Members allow the hon. Lady to be heard, please?

Meg Hillier (Labour, Hackney South and Shoreditch)

We see that students are not the people who are mainly using our health system, although occasionally some do.

There is a key reason why access to basic primary care is important. I will touch on it in relation to other amendments, but it relates to this group as well. It is important that communicable sexual diseases are picked up early. Without casting aspersions or stereotyping any group of people, inevitably when a lot of young single people are thrown together there will be some of that sort of activity. If there is not an easy way for students to get a check, or if they are worried that the surcharge might mean that they will incur more fees, it could be very off-putting. It is important that people in that situation are able to get a health check, because there is wider public health issue for all of us in the UK if students are deterred from doing so.

Going back to the young student whom I met recently on a plane, he was very nervous. He knew the theory but was not sure of the practice. Someone who had to pay £150 or £200 to get access to health care might worry that that was not quite it, and that when they got through the door there would suddenly be another cheque to pay.

Overseas students often live on the margins. They may have a 20-hour-a-week job, or they may not. That can often be transient. They have managed to get here, but they are not all rich. We need to ensure that we think that through.

Will the Minister tell us what thought has been given to the wider public health issues? What analysis has there been of other countries’ experiences? Have they have seen a drop-off in student numbers or encountered public health problems due to the fees that they imposed? I would be pleased if he could answer those questions in some detail. A significant part of our economy relies on overseas students and wants to hear from the Minister how the system will work.

Mark Harper (Conservative, Forest of Dean)

Let me set out what the Bill covers and what it does not. The starting point, as debated on Second Reading, is that the NHS is and will remain free at the point of delivery for our residents, but is a national health service, not an international one. I will also partly answer the point my hon. Friend the Member for Cambridge made about the people we think should pay for it. We think that migrants should have a form of access to the NHS that is commensurate with their immigration status and consistent with the access we give them to other areas of public service. For example, we do not give those who might work and pay taxes, but have limited immigration status, access to other benefits or social housing, or other things that they may feel that, by paying taxes, they are effectively entitled to. We do not do that, and we are trying to treat health in a consistent way. I will come on to that later, when my hon. Friend might wish to intervene on me.

At the moment, the starting position is that we have a generous health service for temporary migrants. Temporary migrants with leave of more than six months currently qualify for free care pretty much immediately after they arrive in the United Kingdom. That effectively means that only tourists and illegal migrants are generally chargeable for health care in the UK. They may themselves evade payment by exploiting the current weaknesses in the NHS’s administration. Let me be clear that the Bill restricts access to free-of-charge health care to permanent residents, which brings the rules on health care into line with existing rules on access to benefits and social housing. That affects temporary migrants; it does not affect overseas visitors, who are already liable to make payments to the NHS—I will say a little bit more about what my right hon. Friend the Health Secretary will bring forward in due course. Temporary non-European economic area migrants will be required to pay the immigration health surcharge.

The Bill will not make any changes to NHS structures or wider charging and identification processes within the NHS. The Department of Health has consulted on those issues separately, albeit in a joined-up way. We have been talking closely to the Department to make sure that those consultations are aligned. Its proposals are for England. That is why it is clear that the immigration health surcharge is an immigration reserved matter, because it is about access to the NHS. It does not affect what can be charged for when people are here. That is why, for example, it does not impact on the ability of the devolved Administrations to carry out their devolved responsibilities in health. That is very straightforward. The Department of Health will publish its response to the consultation in the coming weeks and it can be debated in the usual way. If the Department makes changes through secondary legislation, Members will be able to debate them.

Clause 33 will ensure that temporary migrants to the UK contribute to NHS costs by payment of a health surcharge at the time of their application for entry clearance or leave to enter or remain in the UK. This is probably the right point to respond to what the hon. Member for Hackney South and Shoreditch said about collecting the surcharge. We decided to collect it when temporary migrants make their applications, at the same time as we charge them for their visa. The impact assessment suggests that that will cost £9 million in administration over 10 years. That compares with the £1.9 billion that we think it will raise over the same period, so I think it is a substantial benefit for the Exchequer.

There is another benefit, in that part of the thinking was to collect the money before people come to the United Kingdom. It will then say on their biometric residence permit that they have access to the NHS, which means that the NHS does not then have to do any billing and charging and complex administration. We were clear that we wanted to collect some money so that those temporary migrants made a contribution, but we did not want to make it complex for the NHS to deal with.

Meg Hillier (Labour, Hackney South and Shoreditch)

Are the Government are planning to take the Ryanair approach to charging or will they be up front at the beginning? Will people go through the process of applying for their visa, before something suddenly pops up at the end saying that they have to pay the surcharge? How the process is advertised will make a material difference to how Britain is perceived and how things work in practice, so how will that be done?

Mark Harper (Conservative, Forest of Dean)

I do not think we are going to be covert at all. I will talk in a moment about some of the costs, why we set the amount we did and why I do not think this will affect our competitiveness, but we will not get people to go through the entire process, pay for their visa and then say, “Surprise! There is an extra bit to pay.” Rather, that will be part of the material. Indeed, there is a competitive opportunity for universities. We took evidence from Universities UK and I do not think that British universities get the proper benefit in their marketing from the fact that we do not currently charge and we provide a comprehensive health service. I would argue that if we have a modest fee and universities tell people what they get for it, when students compare internationally and make their choices about where to go, the offer that we are proposing will add to the competitiveness, rather than reduce it.

Meg Hillier (Labour, Hackney South and Shoreditch)

The Immigration Minister will no doubt always be advised about the possible perverse incentives that any change in immigration law could create. If I had a serious health problem, I could apply to become a student and pay my £200. That would be a very cheap route for health tourists who, as long as they had the academic qualifications, could potentially abuse the system. Has he given any thought to that? I do not think it would result in many cases, but it could happen.

Mark Harper (Conservative, Forest of Dean)

I think we have. That was one of the thinner arguments we heard from some of the health witnesses. The obvious flaw in the argument is that, for somebody to do that, they would have to apply to a UK university, which would assess whether they could speak English to the appropriate level and whether they had academic qualifications to the appropriate level. The university would have to accept them and they would have to demonstrate that they could pay for their course, which would be a significant amount of money. Only if they were successful in that would they receive a tier 4 visa to come to the United Kingdom. Once the individual concerned had paid for all that and jumped through all those hoops, I am not sure whether they would get much financial benefit.

It is clear that the health care offer is for temporary migrants who need a tier 4 visa, a tier 2 visa or some other visa that has a sponsorship requirement attached; it is not available for somebody who just wants to rock up to the UK. I made it clear in my questioning in the evidence sessions that that is not available to visitors to the United Kingdom. Somebody who turns up here as a visitor cannot pay a fee and get access to the NHS; they have to pay the full charges. This measure is for people who come here under our managed migration processes, which largely involve having sponsorship and jumping though quite a number of hoops to come here. The risk that the hon. Lady outlines is therefore vanishingly small.

That is how we will collect the money. Under subsection (3)(e), the Secretary of State may exempt people from the general requirement to pay. In our response to the consultation—this is an area on which we consulted fully during the summer—we said that we would not expect those seeking temporary asylum or humanitarian protection to pay. We also said that we would exempt those in the intra-company transfer scheme. The order that will set out the full details of which groups are and are not subject to a charge will be subject to the affirmative resolution procedure. When we bring that order before the House, Members will have a full opportunity to consider and debate who should be exempt from the migrant health surcharge.

I am not surprised that my hon. Friend the Member for Cambridge tabled the amendment. If I represented a city with a significant number of students, I would probably have been tempted to do the same, whatever I felt of the merits of the case. As a constituency MP, he is doing an excellent job of representing that city. Indeed, I visited the university with him, where we talked about our general offer for students. What was encouraging—I think the university accepted this—was that the first-order issues about our visa and welcome to students have been dealt with. It raised some second-order issues, on which we have made progress.

To pick up, therefore, on the point made by the hon. Member for Hackney South and Shoreditch about our general attractiveness to global students, we take every opportunity to work on it. We will keep the overall framework consistent and stable. I think it was my hon. Friend the Member for Poole who said that in a sense we do not want lots of rapid change, but the countervailing pressure is that where details cause problems, people want us to fix them. We will therefore keep the overall framework consistent, but where we can make improvements or straighten out wrinkles, we will consider the case for doing that.

Let me deal with the amendments. It is not necessary to provide in the Bill the exempted groups. The power in subsection (3) is sufficiently wide that the groups referenced in the amendments could well be exempted. Technically, the amendments do not achieve what I think is desired, because they do not actually deliver the exemption; rather, they simply qualify the discretion that is already there.

The Government do not think that students should be exempted from the requirement to pay the surcharge. We think it should be set at a competitive rate—we do not want to disadvantage our universities. However, if we look at the competitive position—this point came through clearly in the evidence—we see that no other country competing in the marketplace for English-speaking students gives out free health care with no charge. Let us look at what other countries require. Australia, for example, insists that students have health insurance cover, which costs significantly more a year than we are insisting on. The United States has no requirement for health care cover before getting a student visa, but it would be very foolish to go there without some cover, while in New Zealand people have to have health insurance.

Health insurance—this comes back to the workers—is a difficult issue in this country, because we do not have the same kind of health care system as many other countries. We do not have a large private health care sector. A lot of private health care policies in the United Kingdom assume that people get quite a lot of health care from the NHS, and those policies are priced accordingly. We have discussed comprehensive private health insurance policies with the insurance industry, and a policy that assumed no access to a free NHS would cost around £3,000 a year. Many policies assume some level of cover from the NHS.

The hon. Member for Hackney South and Shoreditch asked about costs. The Department of Health estimates that the average cost per head of the English resident population for all NHS services—primary and secondary—is about £700 a year for 15 to 44-year-olds, which includes students. The surcharge is set lower than that. It is not intended to recover all of the costs, but a portion of them. The cost of health care in most of our key competitor countries is around £300 to £500 a year, so we think that the rates we have chosen—£200 for those coming here to work and £150 for students—are reasonable. I can confirm to my hon. Friend the Member for Cambridge that the £150 for students is also the figure that would be charged to their dependants.

I have dealt with the cost points, so I will now deal with the point raised by the hon. Member for Hackney South and Shoreditch. Student visitors granted leave of less than six months would not pay the surcharge. They would, as now, be subject to charges for NHS treatment under existing legislation, in the same way as other visitors. Student visitors granted leave of more than six months, up to 11 months—largely those coming here to study the English language—would have to pay the surcharge, in line with other migrants in similar leave categories.

It is worth picking up on the point made by my hon. Friend the Member for Cambridge. I do not understand the issue that Opposition Members have thrown up about student visitor visas. An issue was raised earlier in the year about whether there was a risk of abuse in that category. We looked at it very carefully and published a study, which is available in Library. People have to study at institutions that hold a tier 4 sponsor licence. The growth in student visitor visas is not from the nationalities where we have reduced abuse by tier 4 students, so there is no evidence of any abuse at all.

There is a danger in pretending there is a loophole and threatening to clamp down on it, as I know from the visits I have made to various places and to my hon. Friend’s constituency. The student visitor visa is a key mechanism for legitimate students from around the world to come and study the English language and other subjects. The Opposition should go away and look at the research we have done. If they have genuine questions about the student visitor visa and whether there are legitimate risks, I am happy to talk to them, but I urge them not to put at risk the academic institutions whose students come through that route. There is no evidence of abuse in that route—quite the opposite. We have done work on that route and we should not damage it.

I want to pick up a couple of points raised by the hon. Member for Hackney South and Shoreditch, which were a little odd. First, she said it was odd that rich bankers would not have to pay if they came through the intra-company transfer route because they would have lots of money. I had not realised that the Labour party wanted the NHS to be means-tested and not available to rich people. I do not know why she raised that point.

Secondly, the hon. Lady referred to students and said that younger people generally use less health care. That is perfectly true but, again, the whole point of the NHS is that people do not pay for it based on usage. It is effectively an insurance principle, so the fact that students on average are likely to use less health care than the general population should not mean that they pay less. If we followed that argument on, we would charge people for NHS use based on their health status, which is not a direction that either coalition party wants to pursue, and I am surprised that the hon. Lady does.

Meg Hillier (Labour, Hackney South and Shoreditch)

The Minister is putting words in my mouth. I was saying that the Government have talked a lot about health tourism—or rather, there have certainly been noises off about it—yet students are far from being health tourists. They are among the cohort that uses the health service relatively little when they are here. That was my point; I was certainly not talking about a sliding scale of charges. There is a single, set fee, not a sliding scale. As the Minister said, people can usually pick and choose particular bits of health care to buy in this country because, happily, we do not have a system like America’s.

On intra-company transfers, there seems to be a group of people who are exempt. I am puzzled about that, when a small surcharge would be not even small change for those people. We want to be open for business, but we are charging students, who are very much part of the UK’s future business, and not charging everyone who comes here to work. I am puzzled about that anomaly. That is all I was saying; it was certainly not what the Minister was trying to infer I was saying.

Mark Harper (Conservative, Forest of Dean)

I am grateful to the hon. Lady for putting that straight, so that we are not confused about the direction of Labour’s health care policy.

On the point about those who are working—I alluded to this earlier, but my hon. Friend the Member for Cambridge and the hon. Lady raised the matter specifically—we have generally taken the position, as a matter of fairness, that even if people pay taxes, but do not have a permanent connection to the UK because they do not have indefinite leave to remain, they do not generally have the same access to public services as permanent residents. If people come here perfectly lawfully and pay taxes, but do not have indefinite leave to remain, they are not entitled to any benefits or social housing, so we have adopted broadly the same principle for health care.

The hon. Lady referred to the intra-company transfer route. The distinguishing feature for students is that lead ICT migrants must be in employment, unlike students. I accept that some students work part time, but if they are working 20 hours a week, I suspect that they are unlikely to be earning vast sums of money and paying vast sums of tax—that is, unless they are incredibly talented and amazingly remunerative—yet lead ICT migrants are. This is one of the routes that brings in highly skilled international workers and we have made a judgment to exempt them, based on their value to the UK economy. People may disagree, but that is our decision.

Jim Dowd (Labour, Lewisham West and Penge)

Before the Minister leaves the subject, perhaps he will provide some clarity. He mentioned the cost of private insurance, but it tends to exclude, almost totally, pre-existing conditions. Will those who have to pay under the Bill suffer similarly?

Mark Harper (Conservative, Forest of Dean)

The hon. Gentleman makes a good point, and we thought about having not a health charge, but private health insurance; my hon. Friend the Member for Cambridge touched on that. We decided against that, partly because in the UK we do not have a well developed private health care market, and most policies assume a certain level of NHS access, and partly because, as he says, that would effectively discriminate against people wanting to come to the UK who had pre-existing health conditions.

As I said, there is not a risk of abuse, because people will have had to come here as a sponsored migrant, and will have got leave, either for work or study, by jumping through a load of hoops; this is not for visitors. Of course, there would be a risk if it was for visitors, but it is not. It is available to everyone, and there may well be people who come here with a pre-existing condition that they may or may not know about. The NHS pools risk in the same way. Over 10 years, we will collect £1.9 billion. Some of the people coming will have very good health and, as the hon. Member for Hackney South and Shoreditch said, may not have to use the health service at all while they are here. Some students who come here may be unfortunate and require use of the health service. The risk pooling process means that overall we would expect to come out ahead, but we would not put people through a health check and exclude the sorts of health conditions that have been mentioned.

I will deal with some of the other points that the hon. Lady raised, including the latest numbers of university students. There is still an increase in the number of student visa applications for our university sector, according to the figures that I have. I thought that was the case, and those figures have been confirmed. It is true, as I have acknowledged, that the overall number of students coming to the United Kingdom has fallen. That is because we have rightly dealt with the abuse. A little under 700 sponsors are no longer on the register, either because we have removed them or because they have not tried to continue. In our university sector, which we have deliberately protected in our reforms, we have still seen an increase in the number of students.

The final point was about health tourists. I tried to deal with this in the point I made about the proposals that my right hon. Friend the Health Secretary will bring forward. By health tourists, we tend to mean people who come to the United Kingdom as visitors specifically to avail themselves of free health care when they have no right to be here. The audit report published recently by the Department of Health put the figure for the category of health tourism—people who deliberately come to the United Kingdom for urgent treatment—at between £20 million and £100 million a year, and for regular visitors taking advantage of being here at between £50 million and £200 million a year. These are people who did not necessarily come here deliberately, but took advantage while they were here.

Visitors and people who are already liable to be charged will be dealt with in the proposals that my right hon. Friend the Health Secretary will bring forward in due course. There are two issues. One is that the existing rules are complex. One of the things that came through from the audit was that front-line health professionals find them complex. Actually, it is not just front-line professionals: the evidence we received from the health service unions was that they were complex, and we need to do a better job of making sure that front-line professionals have a simpler system.

There are also perverse incentives in the system. We heard this from the overseas visitors manager from the Sussex trust. He made the point that the incentives were all wrong at the moment. Hospitals’ incentive is not to notice that a person is a foreign national, because then they will be fully reimbursed by the clinical commissioning group. However, if they spot that a person is a foreign national and charges them, they are financially hit if they do not collect the money. I think I am right in saying that my right hon. Friend the Health Secretary will bring forward proposals for a simpler, clearer system that is more effective at getting those incentives in the right place. However, it would be wrong of me to anticipate what he will do, because the House will be able to discuss his proposals in the usual way.

I have dealt with what is in the Bill and the amendments. I hope that I have been able to reassure both my hon. Friend the Member for Cambridge and the hon. Member for Hackney South and Shoreditch, that they will not press their amendments, and that they will allow the clause to remain part of the Bill.

Julian Huppert (Liberal Democrat, Cambridge)

I thank the Minister for his detailed comments. There was a lot to think about in there and a lot of interesting analysis. The issues about students and others that we have touched on are still quite important, but I thank him for what he has said, and I will certainly reflect on it. I am happy to beg to ask leave to withdraw the amendment.

Meg Hillier (Labour, Hackney South and Shoreditch)

I beg to move amendment 54, in clause 33, page 27, line 24, after ‘charge’, insert

‘for those needing treatment for HIV, TB and other communicable diseases as agreed by the Secretary of State for wider public health benefit.’.

Katy Clark (Labour, North Ayrshire and Arran)

With this it will be convenient to discuss the following:

Amendment 55, in clause 33, page 27, line 26, at end insert—

‘(g) exempt pregnant women from the charge.’.

New clause 4—Domestic abuse and female genital mutilation—

‘No charge under section 33 may be imposed for health services—

(a) relating to injuries sustained as a result of domestic abuse as defined in Home Office Circular 003/2013 “New government domestic violence and abuse definition”, or

(b) relating to injuries sustained as a result of female genital mutilation as defined in the Female Genital Mutilation Act 2003.’.

New clause 5—Impact on victims of domestic abuse and female genital mutilation—

‘Prior to implementation of section 33 the Secretary of State must publish an assessment of the projected impact on—

(a) victims of domestic abuse as defined in Home Office Circular 003/2013 “New government domestic violence and abuse definition” or

(b) victims of female genital mutilation as defined in the Female Genital Mutilation Act 2003.’.

New clause 6—Human trafficking—

‘(1) No charge under section 33 may be imposed on victims or suspected victims of human trafficking.

(2) The Secretary of State must—

(a) issue a code of practice for identifying suspected victims of human trafficking for the purposes of this chapter,

(b) from time to time review the code, and may revise and re-issue it following a review; and

(c) lay the code, and any revision of the code, before Parliament.’.

Meg Hillier (Labour, Hackney South and Shoreditch)

This group of amendments and new clauses deals with the impact of the health surcharge on individuals who are suffering from certain diseases, are pregnant, or have been victims of violence as a result of being women. The broad thrust of the amendments and new clauses is not simply to probe the Government; I hope that they will prove that they have thought through the seriousness of refusing access to health care to some foreign nationals in the UK, as there is a wider risk to the community in not tackling certain health issues.

Amendment 54 raises the serious issue of people needing treatment for conditions such as HIV and tuberculosis. As it would be problematic to be too prescriptive in the Bill, I also added the phrase

“other communicable diseases as agreed by the Secretary of State for wider public health benefit.”

Measles, for example, is a big issue in my constituency, and has had its ups and downs since the measles, mumps and rubella scandal; it is another condition that makes it a good idea to make sure that people have access to primary health care. TB is particularly prevalent in my constituency; the rate is akin to that in China. That is a serious public health issue.

My worry is that people will be put off seeking health care. I believe that people should pay for what they get by contributing through the tax and national insurance systems, but the reality is that if the most excluded people do not get access to health care, there will be public health issues. If those people are not getting treatment, they will be out there in the community, spreading the disease and getting sicker. The on-cost to the health service of picking up someone much later on in an illness is much greater; I will come on to some of the figures later.

Let us look at HIV as an example. Thanks to the work of the hon. Member for Guildford while she was Minister with responsibility for public health, treatment for HIV is now free, but testing and diagnosis are another matter. Testing and diagnosis are potentially available through genito-urinary medicine clinics. I am not entirely sure of the system at those clinics—I am not sure that even the Minister is sure—so I do not know what the checks there would be like, but usually those clinics are fairly anonymous. However, for many people it will be more normal to go to a GP; for others it is more likely that a primary health care provider will pick up the fact that they might be in a risk group and need an HIV test.

My constituency has a large African population. They are a very interesting group when it comes to HIV. A number of people in that community would be very nervous about going for treatment in a genito-urinary medicine clinic—they probably would not set foot across its threshold—but might get picked up elsewhere in the system. That is widely recognised. We know that African people do not go to sexual health clinics, so opportunistic offers from a GP for checks for those sorts of communicable diseases are vital; I have focused on HIV, but that applies equally to a range of communicable diseases.

Even though undocumented migrants would not normally have access to the health care system, if they do cross the threshold of a GP practice, those sorts of illnesses can be picked up before they get worse, so this is an important issue. There is a large undocumented group of migrants up and down the UK, including in my constituency. We know that is the case, as does the Minister; we also know that that group will not just disappear overnight. Again, we see the difference between the ideal world of Whitehall and the real world of Hackney South and Shoreditch. Any extension of charging will keep people away from health care, so although I want to see people pay their way, we have to recognise the reality. We need to legislate for the real world, not the ideal world, although I am sure that the Minister would want to point out that we hope to legislate to make it the ideal world.

We need to recognise the existence of that large undocumented group of migrants. They are not hit by the levy, because they are here already. They are not ordinarily resident. They are often quite vulnerable; if we had time, I could give many examples of people who have been living in very difficult circumstances—sometimes they have been trafficked—who are not getting access to health care. They will certainly be put off by all the talk of charging.

Another vulnerable group is pregnant women, whom I mention in amendment 55. The amendment would mainly affect women who present late. That is a big issue in my constituency, particularly for women with diabetes. If a woman conceives while she is sugary, she has an exponentially higher risk of giving birth to a child with severe disabilities. I often meet those children, and parents of children who have serious problems down the line because they did not present early in pregnancy. Sometimes that is directly related to diabetes and other issues, so early intervention can be important. For HIV, that is also an important issue, because early intervention means that a transfer of HIV to the baby can be prevented. Late presentation causes a lot of difficulties. The more that is said about charges, and the more people are put off going to primary care, the more challenges there are.

With regard to HIV diagnosis, 50% of the general population have late diagnosis, but 60% of Africans do. There is an issue there for a particular group of people, not just Africans. That is a group whom I represent and want to advocate for. In recent years, there has been growing consensus among HIV and public health experts—as I am sure the hon. Member for Guildford would attest, if she was able to speak, but being a silent member of the Committee, she can only, I hope, nod her head—that offering HIV testing in a range of non-specialist settings, including GP surgeries, is the key to tackling the UK epidemic. As of last year, HIV treatment is freely available, but unless people go and get tested, they will not get the treatment. There is a gap, and it is important that the Minister, even though he is not a Health Minister, recognises that.

Simon Kirby (Conservative, Brighton, Kemptown)

Would the hon. Lady mind if I paid tribute to my hon. Friend the Member for Guildford for her work in achieving the breakthrough on HIV? That is fantastic stuff, especially in Brighton and Hove.

Meg Hillier (Labour, Hackney South and Shoreditch)

The hon. Gentleman has done what he intended to do. I am sure that a promotion to the Cabinet is not far off for the hon. Member for Guildford.

The Lord Commissioner of Her Majesty’s Treasury (Anne Milton) rose—

Meg Hillier (Labour, Hackney South and Shoreditch)

The hon. Lady is going to speak!

Anne Milton (Conservative, Guildford)

Uncommonly, for a Whip. I thank the hon. Lady for allowing me to intervene. I blush at the praise. The step was an important one to take. She is right about the challenges facing the public health sector in getting people to come forward for testing, but there are a number of initiatives. I know that the Department of Health is doing a great deal of work in trying to encourage people to come forward. It is often with older people—the over-50s—where we have some issues.

Meg Hillier (Labour, Hackney South and Shoreditch)

I think we could have a well-informed debate about HIV, HIV prevalence, treatment and detection. This is clearly not the place for that, but the fact that hon. Members on both sides are aware that there are still challenges means that the issue must be addressed in the Bill. Either the Government are deciding wilfully to ignore it and are making it clear that they will not tackle the issue in the Bill—and if it is not tackled here, then where will it be?—or the Government have recognised that there is a problem, and that they need to acknowledge it in the Bill.

We must also look at cost. In the noise and dog-whistle politics that I fear surround the debate about anyone foreign coming to the country and receiving health care, estimates of what it costs to provide health care to foreign nationals are varied. Last year, the NHS estimated that it spent £33 million treating foreign nationals, and it wrote off £12 million of that sum. I think we would all support the Minister in getting back the written-off amount, because that should not be happening; people who should be paying should pay their way. However, let us get the issue in perspective: that represents about 0.01% of the £107 billion NHS budget. That is a tiny proportion. The risk of not tackling certain types of health problems, or putting people off getting assessed, treated and diagnosed earlier at primary care level, is a risk to the wider UK population. Those sums are considerably less than the net contribution made to the UK by migrants, which is 1.02% of gross domestic product, or £16.3 billion, according to OECD figures. We hear all the negatives, but we have to remember that migrants contribute a lot. We must also remember that there will be people from all backgrounds, including the undocumented, who have health problems that have serious implications for the wider community.

I said that I would touch a bit more on the issue of HIV and African communities in the UK. As I represent Hackney South and Shoreditch, that issue is close to my heart. One in 27 African-born people living in the UK has HIV; that compares with one in 666 in the overall population. Members will understand, I think, why it is such an issue of concern for me. The rate of undiagnosed HIV among African-born people is about 30%, compared with 24% for the overall population. That is still a quarter of the overall population with HIV, but undiagnosed. Prevalence among pregnant women is estimated to be 23 per 1,000 among sub-Saharan African-born women, compared with 2.2 per 1,000 of the overall population, so there is almost a tenfold increase. Those are serious issues, and we need to ensure that the Bill does not cause bigger problems than it professes to solve.

I do not have the time to go through all the cost implications of late treatment, but let us stick with HIV as I have mentioned it a number of times. I have a helpful briefing provided by Still Human Still Here. I do not agree with every position it takes, but this is a useful piece of work. It is talking about the cost of late testing and treatment of HIV. It gives as an example an early treatment financial model. In summary, an overseas visitor comes to London. They are unaware that they are HIV-positive. They visit their GP after suffering repeated minor infections, or for some other reason, and they are treated for the illness. An HIV test is recommended, because of their symptoms and because they have come from a country where there is a high prevalence. They take the test, and that early diagnosis and treatment means that the total cost of treatment over the two years that they might be in the UK will be approximately £26,000. That is not an insubstantial amount of money. However, let us compare it with a late treatment model.

A person becomes ill but does not go to the GP because they are worried about the charging. They get better, but remain unaware that they are HIV-positive because they were never tested. That person then transmits the HIV infection onwards to a UK national. The total cost of treatment in that case would be approximately £351,000, and £323,000 for lifetime treatment costs for the infected partner. The implications of not understanding that there are real, serious issues about communicable diseases, and not having something in the Bill about them, are immense and very expensive. I know that a Minister looks at the big figures and the overall issues around gross domestic product, costs to the health service and so on, but we are talking about people’s lives. Any of our constituents could get a communicable disease as a result of people not going to the health service. That is an ongoing human effect that affects people for the rest of their lives, and that needs to be considered.

Let us focus on the pure financial side, because I know that the Government understand that language. It is much more cost-effective to tackle the matter by allowing people to have access to early diagnosis. I represent many undocumented people. I sincerely want them to be documented or, if necessary, removed from the country if they are not able to stay here. It is not a happy situation, but I am dealing with the reality.

I want to touch on new clauses 4, 5 and 6. For ease, I will deal with them all together. They cover issues around domestic violence, female genital mutilation and trafficking. The people affected by those things really should have access to health care, and I cannot believe that the Minister would disagree with the broad principle of that. I have attempted to answer the question of how we tackle that in the Bill by tabling the new clauses.

As I have said, I have undocumented people in my constituency, many of whom were trafficked as children or young women, and who later emerged without documents or the ability to access health care. If they have been mutilated or are the victims of domestic violence, they often will not have documents—the husband or partner may have removed all their documents—or anything to prove that they are who they say they are. It will be difficult for them to get access to health care and housing. Those issues really need to be covered in the Bill.

I am aware that time is short, but let me say quickly that trafficking is a big concern. I meet trafficked constituents on a fairly regular basis. Many of them have been trafficked for years, and there are also issues here around definitions. Someone who has been trafficked may not have had access to health care. They may have been denied all sorts of things by the person who trafficked them, or to whom they have ended up enslaved. They may have just wanted to live below the radar. Many of the people who come to see me are aware that they are undocumented but frightened about what they should do about it. It is only at the point at which they really need to get something to prove that they are who say they are when they are young adults that they come to see me. Under the proposals, many of those people will be frightened to look for health care and, as they get older, unable to access housing. This country has a moral duty to support victims of trafficking.

We talk as though the trafficking Bill will solve everything, but the reality is that a lot of people who are trafficked are not obviously victims. Many become used to their situation and adapt to the fact that they are living in a never-never world. They do not escape, although they can operate freely, because they do not have anywhere to escape to. They are as much prisoners of their situation as if they were locked away in a home. We can think of trafficked sex slaves in massage parlours, locked up and unable to escape, but a lot of the people I deal with are not in that situation. However, unless they can access healthcare and other services they will have real problems.

Rather than going into more detail, I wanted to get across my broad concerns, some of which I am sure the Minister shares. How do the Home Office and the Government intend to ensure that people who are in great need, do not lose out and are not affected negatively? If their needs are not met there will be a wider impact and a cost to society.

Mark Harper (Conservative, Forest of Dean)

Members can be assured that I will be relatively brief, not because the issues that the hon. Lady has raised are not important—they are—but because they fall largely outside the scope of the Bill. Most of the issues she raised are very important. In her constituency she may well encounter people who fall into those categories. However, the issues of charging people who already have to pay for access to the NHS will be addressed by measures set out by my right hon. Friend the Secretary of State for Health.

The hon. Lady raised the issue of public health. The consultation document that the Department of Health published has made it clear, as has the Secretary of State for Health when he has spoken in the media and in the House, that we want to retain the exemptions on charging for public health matters. We recognise the hon. Lady’s point, which was also raised by witnesses, that if somebody has a public health condition—a communicable disease, for example—it is better to identify and catch it early so that we can treat them and prevent the disease from spreading. The hon. Lady is quite right on that point. I want to reassure her that we do not seek to change that process in either the Bill or the proposals that my right hon. Friend the Health Secretary will introduce. The hon. Lady talked about people’s concerns. The Department of Heath is well aware that it needs to ensure that people are not deterred because they erroneously think they will be charged.

Meg Hillier (Labour, Hackney South and Shoreditch)

The Minister makes what sounds like a reasonable point, but the reality is that a lot of people would not go to the GP to get a diagnosis for something they do not know they have got. That is particularly true of HIV, and particularly among many of my African constituents who are undiagnosed, on which I gave the figures. Often, they do not want to acknowledge the issue. Many of the people with whom I work have a complex set of circumstances. If they can get free treatment or a free diagnosis for HIV, but because they do not know they have got it they do not check, there is still a risk. That is the crux of the problem with the Bill’s provisions. I would be grateful if the Minister could explain his thinking on how we can ensure that people with such problems and diseases are diagnosed. Diagnosis, rather than treatment, is the key issue.

Mark Harper (Conservative, Forest of Dean)

The hon. Lady raises an important issue. Whether or not you would indulge me, Ms Clark, I will resist the temptation to go outside the scope of the Bill. The hon. Lady is effectively asking a question for my colleagues in the Department of Health and the Minister responsible for public health. These are public health issues; they do not fall within the scope of the Bill, they are not the responsibility of the Home Office and they are not affected by the proposals in the Bill for an immigration health surcharge. Those issues were covered in the consultation document that the Department of Health published earlier this year, and they will be covered in the response to that consultation, which the Government will publish in the coming weeks. I have heard what she said, and I know that colleagues, officials and Ministers in the Department of Health will look at the record closely. When the Health Secretary publishes his proposals, she will have an opportunity to raise her concerns on behalf of her constituents, but I do not think the concerns are for me. They are not in any way affected by the proposals in the Bill.

The hon. Lady mentioned TB, and we have historically screened for active TB at the border. We are expanding our screening for those from high-risk countries applying for more than six months’ leave. Pre-entry screening, followed by treatment where necessary, will help to prevent the importation and spread of TB in the UK and will save lives and taxpayers’ money.

In response to our public consultation, victims of human trafficking will be exempted from the surcharge. On the hon. Lady’s general point that victims of human trafficking may already have been trafficked here, I hope that she is encouraged by the setting up of the National Crime Agency in early October. The Home Secretary said at the agency’s launch that, as part of its organised crime work, border policing would focus on human trafficking. That will be one of the agency’s important tasks. Together with the legislative changes in the modern slavery Bill, to which the Minister for Crime Prevention referred, that will make a real difference.

There is not an overnight solution that will solve every problem everywhere, but there will be an increasing focus on the matter by law enforcement, including individual forces—the Met, which covers the hon. Lady’s constituency, is particularly focused on human trafficking—and the National Crime Agency, at national and international level. I hope that is encouraging.

The hon. Lady has raised some important issues, and I recognise their particular importance for her constituency, but they are largely issues that should properly be addressed when the Health Secretary introduces his proposals, rather than in considering this Bill. I therefore urge her to withdraw the amendment.

Meg Hillier (Labour, Hackney South and Shoreditch)

I thank the Minister for his thoughtful comments. I will take his advice and liaise with his colleagues in the Department of Health. I beg to ask leave to withdraw the amendment.

Helen Jones (Labour, Warrington North)

I beg to move amendment 51, in clause 33, page 27, line 30, at end insert—

‘(4A) The Government shall, 12 months from Royal Assent of this Act, lay before the House a report on the sums collected under this section and the expenditure thereof.’.

Katy Clark (Labour, North Ayrshire and Arran)

With this it will be convenient to discuss clause stand part.

Helen Jones (Labour, Warrington North)

Prior to the start of the Committee, we were talking about Christopher Marlowe. I am not sure whether I can emulate the eloquence of Marlowe’s “mighty line,” but I want to raise some concerns.

We support the principles enshrined in the clause, and I will explain why. There will always be emergencies in health care, and I am proud to live in a country that treats people in an emergency and worries about the cost later. Equally, I am extremely proud of the work our health care staff do overseas in emergencies and on other occasions. I am also proud that we sometimes bring people here for specialised treatment, which I think is one of the things that makes this a great country in which to live.

The NHS, however, was founded to provide health care to people in Britain; it was not founded to provide substantial health care to people from elsewhere. We must be clear about the NHS’s founding principles, about which some people are mistaken. There was never a question that people should pay tax to be eligible for NHS care because, of course, some people never pay tax as they are too sick and some people pay tax for only part of their life. In fact, if I remember correctly, the original scheme in south Wales upon which Nye Bevan drew covered not only the miners who paid into it but their families. The scheme was a pooling of risk, and the NHS is a pooling of national risk.

The hon. Member for Cambridge referred to moving away from the principle of national insurance, but we do not have a separate fund, and we never did. I remind him again of what Nye Bevan said:

“The great secret about the National Insurance fund is that there ain’t no fund.”

In some of the representations that have been made to the Committee, I have seen arguments quoting Bevan himself about the way we treated visitors—foreign nationals —in this country. However, let us remember that we are talking about an era when there was very little foreign travel and there was not mass migration.

I have some reservations about the evidence that the Government have recently published about foreign nationals’ use of the NHS, not least because on occasions it does not distinguish between foreign nationals and expatriates. That is not in the Bill, and that argument is for another day. However, it is quite clear to Labour MPs that the test of ordinary residence is fairly generous, and I agree with the Government’s view that the test is satisfied by many new and temporary migrants almost immediately, and covers many people, including students and newly arrived family members.

The Government’s review in 2012 estimated that if the criteria for changes to eligibility set out in clause 34 —if you will permit me to mention that clause now, Ms Clark—were to come into force, more than 700,000 non-EEA temporary residents would no longer be eligible for free NHS care unless they were specifically exempted by the charging regulations. The proposal in clause 33 simply requires people who apply for immigration permissions—temporary migrants to the UK—to pay a charge. I understand that the Government intend the charge to cover most NHS services, although some expensive discretionary treatments would be excluded. That seems to be a generally fair way of proceeding. However, I wish to make a couple of points about possible exemptions later in my speech.

We heard evidence from Universities UK about the effect that it thought this measure might have on students coming here. The hon. Member for Cambridge and my hon. Friend the Member for Hackney South and Shoreditch referred to that evidence; normally, I hold the hon. Gentleman in the highest regard, but I disagree with him on this occasion. The Russell Group has sent in similar evidence, saying that the plans to introduce a compulsory levy could affect the UK’s competitiveness in attracting international students and staff. I must say that there is not any evidence of that at all, because frankly, someone from the UK has to pay health insurance if they go to many other countries, particularly those that have English as the main language. Although they do not have to have health insurance if they go to the USA, they would be a very foolish person to go to the USA without either health insurance or very deep pockets. We cannot compare a health service in which people are charged immediately with one that generally provides treatment free at the point of use and worries about the charging afterward, so I was far from convinced by that evidence. The exception that we were told about was the USA, but as I say, I do not think that stands up.

The Government’s proposal has our support, except for one thing. In the case of many proposals that they have published recently, they have made great play of the amount of money that is lost to the NHS, but they are giving no guarantee that any of the sums generated from the charge will go back to the NHS at all. Unlike money that NHS trusts recover, this money will, as clause 60(4) says,

“(a) be paid into the Consolidated Fund, or

(b) be applied in such other way as the…order may specify.”

It seems that the Government have not yet made their mind up about what they would do with that money, although the Minister may correct me when he responds.

We must consider how the money will be allocated. We have arrangements with the devolved Administrations, because health is a devolved issue. If the Government are so concerned about the NHS losing money and treating people who should not really be getting free treatment, why are they not ensuring that the charges are returned to the NHS? That is why our amendment asks for a review of the sums that are to be collected and how they are to be disbursed. That is the issue that we are trying to probe.

There are real questions about how the money will be used. Will hospitals that treat a high proportion of foreign nationals get a fair share of it? How will money be shared with the devolved Administrations? We heard in the earlier debate on landlords that there are problems in the case of housing—the costs may fall on the devolved Administrations but there is no guarantee that they will get those costs back.

I would also like clarification from the Minister on whether any of the money will go into primary care. Many people who come to this country perfectly legally, having paid this charge among others, will be accessing primary rather than secondary care. It is those services, in areas where there are a lot of students or people from a particular area who have come as migrants intending to settle, that have the most demand and have to provide the extra work. The purpose of the amendment is to see in practice what happens to the money.

The other matter I want to raise is how the charge will be kept under review and what factors will be taken into account during review. We know that health costs always rise faster than inflation. On the other hand, I accept, as I think all Committee members would, that there is a balance to be struck. We do not want to put off people coming as visitors who would bring benefits to this country, such as students. We do not want to put off people who make a significant contribution to our economy, nor do we want to provide large health care subsidies to people who are not contributing to the system. I would be grateful if the Minister would clarify the position.

Clause 33(4) says:

“In specifying the amount of a charge…the Secretary of State must (among other matters) have regard to the range of health services that are likely to be available free of charge to persons who have been given immigration permission.”

Although there is nothing about exemptions there—I know that this issue is not covered in the Bill—it would be helpful if the Minister could clarify which treatments will not be covered by the charge. I know my hon. Friend the Member for Hackney South and Shoreditch is concerned about those who have suffered domestic abuse or FGM and women have been trafficked into this country.

I received an answer from the Department of Health that said it was planning to exempt certain groups of people on humanitarian grounds, as the Minister said earlier, which would include

“refugees, asylum seekers and victims of human trafficking”.—[Official Report, 29 October 2013; Vol. 569, c. 445W.]

I accept that intention, but I want to press the Minister on how that might work in practice. Like me, he will have seen the issues raised by various organisations. I met yesterday with representatives of Caritas Social Action Network, the umbrella group for Catholic charities, and of the Catholic Bishops Conference. They have genuine concerns that trafficked women and children—who will not, by definition, have paid the charge when they come in, as they did not arrive through legal channels—will be difficult to identify in practice.

The United Kingdom Human Trafficking Centre suggested in its 2012 baseline survey that more than half of all trafficking victims were not referred to the competent authorities for assessment. We want to know what will happen to them. The Minister will be well aware that there is still a problem throughout our system with victims of trafficking often being treated as criminals rather than victims. Has he had any discussions with his colleagues in the Department of Health on how that will affect the way we deal with their health care needs?

The next category of people I want to raise with the Minister are victims of domestic violence. By definition, these people—mostly women—are coerced. They are under the control of their partner. What happens if they escape a violent relationship and are left without any evidence of their entitlement to care or even of their immigration status? What would be their position in law? If they have not paid the charge or there is no evidence that they have paid it, how will they be able to access medical care? If victims of domestic violence have been brought to this country illegally, they could be subject to the charges specified in clause 34, but as they are often left without any means of support, they will not be able to pay. Victims of domestic violence are not mentioned in the answer I received from the Department of Health, so I would be grateful if the Minister could tell us the Government’s position on that.

I would also be grateful if the Minister could give us an idea of what the exemptions are. As I said earlier, we believe that the general principle of some exemptions is fair. We do not want people to come here for expensive treatments after paying a small charge, but we would like to know which treatments the Government will make exempt and what will happen in difficult situations, where health care staff have to make extraordinary choices.

I should like to give one example. Last year there were stories of people coming into Manchester airport to access services, particularly maternity care, at Wythenshawe hospital. It was alleged that a woman came in requiring an emergency Caesarean after a scan in her own country revealed complications with her pregnancy. Under the regime the Minister proposes, she would have to pay a charge for her visa. What happens when she gets to this country? That is clearly reprehensible behaviour—it is appalling behaviour—but doctors and nurses dealing with such a person will no doubt feel that they have a duty to the unborn child, too. What will happen when someone comes here and pays the charge, but requires that sort of expensive treatment, which involves some difficult moral choices for staff working on the front line? It is not always as straightforward as we might like to think. I should be grateful for the Minister’s views.

Mark Harper (Conservative, Forest of Dean)

I am grateful for the hon. Lady’s support for our general principle and she asks some perfectly sensible questions. She is quite right about where the money goes: it goes into the Consolidated Fund, as the Bill says. I repeat the answer my hon. Friend the Minister for Crime Prevention gave. There are processes that we have in government, and if the shadow Chancellor were here, I am sure he would tell the hon. Lady the same thing as the Chancellor would. Those are matters for the Treasury and Treasury Ministers. They have a process to do public spending and work out how much we are spending and which Departments it goes to, which is well above my pay grade.

The hon. Lady asked very sensible questions about how the money is dished out across the devolved Administrations, given that health is a devolved matter. I think I covered this either in the evidence session or on Second Reading. We have obviously consulted and have been speaking to all the devolved Administrations and the relevant Ministers. They are aware of what we are proposing. It was also brought up at the joint ministerial council that was held at Downing street a few weeks ago, which the First Ministers attended. The discussion there—about what, if any, money would go the devolved Administrations—was an action that the Chief Secretary to the Treasury took away. I understand that he will meet with the Finance Ministers of the devolved Administrations later this month. The issue is on the agenda for their discussion.

Helen Jones (Labour, Warrington North)

I know that time is short, but could the Minister or his colleague the Chief Secretary tell us the decision on that before Report?

Mark Harper (Conservative, Forest of Dean)

I am sure that if they have made a decision, they may be able to do so, but I would hesitate to presume. What I will commit to doing is to report back to the Committee, depending on how those discussions pan out. I think I will be able to do so before Report. I will certainly report back what we know, but I cannot commit that those discussions will have concluded.

The hon. Lady asked how the Secretary of State would decide the level of the surcharge. Clause 33(4) sets out that the Secretary of State will consider what health services are likely to be available. I think I am right in saying that when the Secretary of State for Health publishes the response to his consultation, he will set out what, if anything, will not be covered for England. Obviously services that might or might not be provided elsewhere in the UK are matters for the devolved Administrations.

As the clause says, there are other matters involved, such as the impact on the UK’s competitiveness. In the same way that we look at the cost of running an immigration system when we set our visa fees, we also look at how we compete across the world. We absolutely take that into account. In the various materials we have published, such as the response to the consultation and the impact assessment, we have looked carefully at comparable English-speaking countries and other competitors, and at the equivalent level of health charges and how they compare with the overall cost of attending higher education in the United Kingdom, and we will continue to do so.

The amendment asks the Government to provide information to the House on the sums collected. I might have missed it, but I do not think the hon. Lady spent much time talking about her amendment, as she was largely making a clause stand part speech, which is fine. However, there is an exciting publication called “Managing public money,” published by Her Majesty’s Treasury, which is recommended reading for all colleagues and has some specific guidance. The hon. Lady recommended the Immigration Act 1971 to colleagues as useful reading for insomniacs, and I suspect that “Managing public money” is probably as riveting a read. In section 6.7—[Interruption.] I am told that it is more interesting. Section 6.7 says that our processes have to be transparent and that we have to set out details disclosing fees, charges and levies. We will therefore set out income from the surcharge not just in the first year, which the amendment would require, but throughout its operation. That transparency will be provided by the usual conditions under which we must work.

I will not go into this in tremendous detail, because most of it relates to matters that are not pertinent to the Bill, but the overall position from the health audit that the Health Secretary instructed to be carried out is that the cost of treatment provided to visitors and migrants is around £2 billion. Some of that money is recovered, but quite a lot is not. The Secretary of State recognises that, for sensible humanitarian reasons, there will be money that we never collect. I agree with the hon. Lady that we have a health service as a back-stop provision that will never refuse urgent or necessary treatment to somebody because they cannot pay for it—I think I detected that that is her position. That is a good thing: I do not want to be in a country where if someone needs urgent treatment, perhaps to save their life, we argue about whether they can pay for it before we deliver it. We might argue with them afterwards about paying for it, but we deliver that urgent and necessary treatment.

When the Health Secretary published his consultation, he said that although we accept that we will be unable to recover all of that £2 billion, we ought to be able to recover about £500 million that we do not currently collect. Some of that will come through the surcharge in the Bill and some will come from the proposals that the Secretary of State has consulted on and will introduce. There will be money that we do not collect, and it is probably right that we do not.

The hon. Lady asked two specific questions. One was about trafficking, which I covered earlier. Obviously it depends on recognising that people are victims of trafficking, and I know that the NHS has recently put in place training for front-line health care professionals to alert them to the risks of trafficking and some of the signs they should look out for. That way we can increase the number of people in the public sector work force who recognise that trafficking is an issue not just in big cities, but across the country. There has been an increased focus on the issue from the National Crime Agency, law enforcement, Border Force officers and more widely. We recognise that trafficking remains a problem, but we are taking steps to deal with it, and I know that there is cross-party support for increasing those steps.

The hon. Lady also asked about victims of domestic violence. For people who are partners of British citizens and who have settled in the UK, but whose relationship breaks down, there is, of course, already provision in the immigration laws to apply in their own right for indefinite leave to remain. Once they have indefinite leave to remain they have access to the NHS without having to pay a surcharge. There is provision in the immigration laws to deal with victims of domestic violence who are here as partners rather than in their own right.

The final point raised by the hon. Lady was about a maternity health tourist. Someone who comes here as a visitor does not have the option of paying the health surcharge and receiving free NHS care. The hon. Lady gave the example of someone who decides that they have a particular health condition, wants to come to the UK and pops over on a visitor visa. That person is of course legally obliged to pay for their NHS treatment. One proposal that is being introduced is about better identifying such people, incentivising hospitals to do so and collecting the money more effectively.

If somebody turns up with a health care issue that must be dealt with, particularly if it affects somebody else—in the hon. Lady’s example it was the unborn child—the health service will of course provide emergency treatment. In that case, the person concerned might be issued with a bill, and if they cannot or will not pay, we have recently made provision in the immigration rules to ensure that they are not given a visa to return to the United Kingdom until the debt is cleared. We heard last week in evidence from the overseas visitors manager that the provision that is now in the immigration rules—a debt to the NHS of more than £1,000 can now be reason for refusing a visa—has increased the effectiveness of the collection process. People who want to return to the United Kingdom as visitors or for business know that they cannot leave big unsettled health care debts. If they do, they will not be able to return.

I hope that I have dealt with the hon. Lady’s amendment and the remaining wider issues relating to the clause and that she can therefore withdraw her amendment. I commend the clause to the Committee.

Helen Jones (Labour, Warrington North)

There might be one or two issues that we wish to return to on Report, but for now I beg to ask leave to withdraw the amendment.