Housing and Regeneration Bill

My Lords, I beg to move that this Bill be now read a second time. I am delighted to introduce the Housing and Regeneration Bill to this House. It will help us to meet one of the great challenges of our generation: to ensure that future generations have as much opportunity to own their homes as we have had and that they live in communities both new and renewed that will sustain and create opportunities for all, no matter what their individual circumstances. It also offers for the first time a greater say for social tenants over their own housing options and conditions. It will bring specific help for a range of other social groups and housing providers. I believe that the Bill will be welcomed by your Lordships as it has been already in the other place and across the housing and regeneration world. Perhaps I may first set the context. Aspirations and expectations in terms of both home ownership and housing standards have risen dramatically in the past half-century. The Government share these aspirations. We believe fundamentally that everyone should be able to live in a decent home at a price they can afford, and we have done much to make that vision a reality. I remind noble Lords that housing supply in England has risen by more than 50 per cent from a low of around 130,000 new homes nationally in 2001-02 to almost 200,000 in 2006-07. Between 1997 and 2006-07, we helped around 95,000 householders into home ownership through shared ownership and shared equity. And since 1997, more than £23 billion has been invested in improving social housing. However, two major challenges demand that we think, plan and develop differently: demography and climate change. The growth in households and the demand for homes have outstripped supply for many years, and the consequences are self-evident: young people dependent on their parents for a deposit; teachers, nurses, care workers, policemen priced out of the local community where they work; and too many older people trapped in a home which has become a burden because there are so few appealing alternatives. But just as we have to meet the intensive demand for new homes in the south and east—and to do so sustainably—so we have a responsibility also to regenerate declining communities in the north and west in particular. We have to be more ambitious and more efficient to meet the scale and diversity of housing need. We have also to ensure social cohesion as well as environmental sustainability, and to provide the range of affordable and sustainable homes that is so urgently needed. Our response reflects the scale of those challenges. The Prime Minister announced that we would seek to deliver 3 million additional new homes by 2020. In July, we published a housing Green Paper which set out our action plan for delivering on this commitment. It included: a national target of delivering 240,000 new homes a year by 2016; five new eco-towns—now increased to 10; better use of public-sector land; an £8 billion funding programme for affordable housing in the period 2008-11; and a commitment to delivering greener and better-quality homes. This Bill is crucial to achieving all that. We cannot deny that these are challenging targets, nor can we deny that, in recent months, there have been changes in the financial and housing markets that make this Bill and the changes that it will bring all the more important, and make it all the more essential that we are able to think creatively, invest wisely, respond flexibly and bring together all the partners needed across all parts of the housing market. The Bill seeks to achieve that by creating the Homes and Communities Agency, a single agency which will bring together individual programmes, partnerships and funding streams to make it more possible to build more affordable homes in the right places, and of the right kind, for people of different conditions and needs, to increase the energy efficiency of new homes so as to be carbon neutral by 2016, to build to the limits of innovation in both the public and private realm, to give tenants a greater say over how their homes are managed, and to focus on the key outcomes of growth, renewal, affordability and sustainability. The new Homes and Communities Agency is critical to better delivery in housing and community growth. It is a bold and ambitious step forward. Both the Housing Corporation and English Partnerships have a record of outstanding achievement in recent years, but it had become evident that separate funding streams, parallel processes and separate negotiation meant that opportunities for investment, innovation and coherent planning and delivery might be missed. Part 1 establishes the new Homes and Communities Agency to ensure that that does not happen. It opens a new world of possibilities. It will not only bring together responsibilities and powers which have previously been held by the Housing Corporation and English Partnerships, but it will also take on responsibility for delivering a number of housing and community programmes so far held by my department, CLG, and responsibility for the Academy for Sustainable Communities. The scale, the scope and the synergy created by bringing all these related responsibilities together in one place with one focus will now match necessity with real opportunity. It will bring over £1 billion in savings, bring skills, expertise, investment, funding streams and delivery systems together, and provide an opportunity for doing things differently which could not have been realised by simply merging or modernising the two separate organisations. I am delighted to say that the new agency has the blessing of both English Partnerships and the Housing Corporation. I pay tribute to the outstanding work of my noble friend Lady Ford as chair of English Partnerships and of my noble friend Lady Dean at the Housing Corporation. Noble Lords will appreciate how very grateful I am to have them on this side of the House for this Bill. Evidently, we want to see the HCA help maintain overall supply in the coming years. It will inherit the challenging programmes of its predecessor organisations, but it will also, given its scope and experience, be in an ideal position to provide stability in the housing market at this difficult time. Without losing its inherited capacity, the HCA has the chance to forge a new culture of creativity, enterprise and partnership. It is already in the best possible hands. We are particularly delighted that Sir Bob Kerslake is its chief executive designate; his vision is already clear. The agency has some important and challenging targets to meet if it is to deliver affordable homes on the scale we need. But the critical task is to create not just the right type and range of homes but communities of opportunity for people and places as well. In Sir Bob Kerslake’s words, the opportunity now is to create a ““single conversation””, shared between the agency and the regional and local authorities, the building industry, funding agencies, planning bodies, landholders, and communities themselves. The Bill, particularly in Clauses 5, 22 and 34 to 39, enables the agency to take forward the Housing Corporation’s functions in funding delivery of affordable housing. The agency will play a critical role in delivering 70,000 more affordable homes a year by 2010-11, and support the delivery of 3 million new homes in total by 2020. The agency will also take forward the work of English Partnerships in regenerating communities and bringing brownfield land back into use. It will also incorporate the Academy for Sustainable Communities, which will mean that we have the opportunity to drive and improve skills—not just the skills of building physical infrastructure but those for social infrastructure in communities. The agency take forward the improvement of existing social housing stock by continuing the decent homes programme, making sure that 95 per cent of social rented homes are made decent by the end of 2010. It will also take on responsibility for housing market renewal and growth areas. All those programmes are currently located within my department. The agency will also be responsible for the Thames Gateway, the biggest regeneration project in western Europe. But we are not concerned simply with housing supply, important though that is. Building communities is not just about housing; it is about putting in place other infrastructure, such as public transport, local shops and community facilities and sports and leisure facilities, and ensuring that people can access employment and leisure opportunities, which are the things that make communities work and a pleasure to live in. We aim to achieve homes and communities where people are proud to live, now and in the future. We want to see inspirational design; we want the ““wow factor””, not just in homes but in the public realm as well. We expect the agency to work with local authorities and spur them fully in their efforts to develop ““lifetime homes””, so that people can remain independent and can age in place. The vast majority of the agency’s powers will be inherited from previous legislation governing the Housing Corporation and English Partnerships. For example, Clauses 13 and 14 enable the Secretary of State to give the agency planning powers in certain areas, but they are modelled on existing powers provided by the Leasehold Reform, Housing and Urban Development Act 1993. Those powers may be used in pursuance of the agency’s objectives, set out in Clause 2, whose breadth give the agency the necessary flexibility to find the right solutions for the right areas. I stress that the Government will look to involve and consult closely local authorities when the use of these clauses is being considered. Indeed, in the one example that we have so far, when English Partnerships used its similar powers in Milton Keynes, the local authority was fully involved in establishing the delivery vehicle. With such a range of powers, noble Lords will want to be assured that we are not creating a behemoth or a juggernaut that will slow things down, impose top-down demands or frustrate other partners—whether housing associations, regional development agencies or local authorities. I can give those assurances. First, the agency will have offices in each region to help those relationships at the local and regional level to flourish. Secondly, for local authorities in particular this is very good news. The relationship between local authorities and the HCA will be critical. The agency will be no less than local government’s best delivery partner, working with the grain of local ambitions and local needs, while securing the achievement of government targets. In the other place, the proposals for the new agency received a constructive welcome. There was particular support on all sides, however, for the role of the agency in delivering on the sustainability agenda to be strengthened. The Government were pleased to be able to respond to this and we amended the objects to include contributing to the achievement of sustainable development. Of course, this underlines the fact that good design will be a highly important feature of the agency’s work, and I know that many noble Lords will welcome that. The Bill was also amended to provide greater clarity over the agency’s relationship with the GLA. Those changes have made the Bill better and stronger. The Bill is not just about delivering more and better homes. It will also break new ground in giving social tenants new rights to high standards of housing, access to better services and more say over how their homes are managed. In that sense, therefore, the HCA and the new social regulator that are contained in Part 2 of the Bill, are complementary in terms of ensuring and securing the better supply and condition of housing. Part 2 of the Bill establishes a new regulator for housing association tenants. Its predecessor body, the Housing Corporation, was established in 1964 and the current limited system of social housing regulation was introduced more than 30 years ago. Regulation has, until now, been focused on making sure that RSLs were well run organisations with sound financial management. We must not underestimate the importance of the changes in the scope of regulation and the creation of a regulatory regime that will mediate between some of the most vulnerable people in the community and the RSLs. They are benevolent providers, but nevertheless have a monopoly over the consumer. That means that the regulatory framework in the Bill is, rightly, rather different from other regulatory frameworks. Noble Lords will also want to know why we have confined this initiative to registered social landlords, given that there have also been calls for the regulator’s remit to extend to local authorities. Let me explain. We agree with the principle that there should be a single cross-domain regulator for social housing. Obviously, tenants should have a right to expect good housing services no matter who their provider is. We have made it clear that it is our intention that the regulator’s remit should be extended to local authority landlords within two years of it being established. We understand why there are calls to move faster on this, but getting this right will take time, particularly as we need to ensure that regulation supports the principles of the new local authority performance framework. We have to bear in mind, in particular, that the landscape of social housing has changed significantly. The housing association sector, to its huge credit, has risen to the challenge of providing an increasing proportion of the social housing stock since 1988, with both large-scale voluntary transfers and massive investment in building new homes. Throughout the country, many housing associations are key players in their local communities. But tenants’ experiences have changed too, and this Bill will put tenants at the heart of the new system. The fundamental objectives of the regulator, set out in Clause 88, are wide because the regulator can act only in accordance with his objectives. That means that important issues, which are not the direct responsibility of the regulator—like the supply of new social housing—must be reflected here so that the regulator can take them into account in his work, for example, through setting standards. The new regulator will therefore be tasked with protecting tenants and helping them to have greater choice and influence over matters central to their everyday lives. He will do this primarily through setting standards for accommodation, facilities and services in connection with social housing—in Clauses 191 to 196—which will be developed in consultation with landlords, tenants, and a range of other interested bodies, including the Homes and Communities Agency, lenders to the social housing sector, and the Government. Where landlords fail to meet standards, the regulator will have new powers to step in with fines and enforcement measures designed to improve services to tenants. But we are quite clear that the independence and integrity of landlords is important too, so these powers are balanced against an objective to minimise interference, and behave reasonably, transparently and proportionately—Clause 88(11). The regulator can intervene only when there is a material breach of standards, not a technical breach or an isolated incident. So this is about targeting the regulator’s efforts where they are really needed and can be really effective. Landlords who involve their tenants and deliver good services should in fact see fewer burdens, not more, but poor performers will be subject to a quicker and more targeted regime of sanctions, focused on securing rapid improvements to services. Enforcement notices will set out to landlords exactly what improvements are expected, and what the consequences will be if improvements are not delivered—Clauses 216 to 224—and the regulator will have power to fine landlords, to award compensation to tenants and, in the worst cases, to require them to employ another organisation to manage their housing. Let us put ourselves in the shoes of tenants. This means a regulator that sets clear standards on what level of management service tenants can expect from their landlord—for example, the quality of their accommodation and the speed of repairs—publishes clear information on landlord performance against those standards in a form accessible and useful to tenants, listens and responds to tenants’ concerns about systematic breach of standards and uses their evidence to investigate, uses enforcement powers when needed to name, shame and fine landlords, and compensate tenants and gives tenants more opportunity to be involved in management of their own homes—Objective 3. I met Martin Cave recently and was pleased to hear that he is happy with the way his vision for the future of social housing regulation is being turned into a reality. He wanted to see an independent regulator, with government influence strictly limited, and the Bill delivers this. The regulator will be independent of government, and the changes that were made in the other place make it clear that the Secretary of State may direct it only on certain standards relating to rent, the physical standards of homes, and tenant engagement. Government will have no role, for example, in the exercise of the enforcement powers. That debate also made clear the Government’s commitment to protect tenants and public investment while preserving the independence of providers. There was significant debate in the other place on how to get right the balance of regulation in the Bill. In response, we made important amendments to ensure that we strike the right balance and to ensure that the status of RSLs as private bodies is clear, for example, in relation to the Secretary of State’s powers of direction, as I mentioned earlier, and the enforcement powers. While we are still considering whether a number of additional amendments may be necessary to address technical issues raised by stakeholders, overall I think that we have the balance right. The final part of the Bill includes a number of small but nevertheless significant provisions which will improve the way in which housing services are delivered and raise environmental standards. Measures to support and extend the mandatory supply of information about the sustainability of new homes are an important part of the package of measures to ensure we deliver our commitment to zero-carbon homes by 2016. Linked to the regulatory reforms to give tenants more choice and voice, the Bill makes a tenant ballot mandatory before decisions about transfers out of local authority ownership. Significant changes to the housing revenue account subsidy system will give councils more income from any new homes they build. Measures to enable landlords of shared ownership houses to restrict ““staircasing”” in hard to replace areas respond to concerns that affordable rural housing is being ““lost””. Changes to address an anomaly in housing legislation which has existed for far too long ensure that service personnel are put on an equal footing with civilians when applying to a local authority for social housing or for help because they are facing homelessness. There is provision for family intervention tenancies, which are designed to help to support delivery of family intervention projects, which provide intensive support to a small number of the most challenging families. Amendments made in the other place have helped to ensure that the right safeguards are in place to protect these vulnerable tenants. In response to a European Court of Human Rights ruling, there are improvements to security of tenure for Gypsies and Travellers living on authorised local authority sites. I know that noble Lords who have highlighted the lack of equity in the current situation will welcome this change. Provisions introduced in Committee in the other place ensure that tenants retain tenancy status as long as they live in their homes to address the problem of ““tolerated trespassers””. The Bill represents the clearest possible expression of this Government’s commitment to social justice. It will help to address the shortage of affordable housing for first-time buyers and families; it will make new housing greener to tackle climate change; and it will give social housing tenants a better deal. It will build on the outstanding work we have done in regenerating some of the most deprived and marginalised communities in our country. It addresses some of the biggest challenges that we face today. I have set out the broad picture but we will have the opportunity in Committee to discuss how this will be achieved. I look forward to that because I know that your Lordships have a particular interest in how things will be achieved. I also know that all round this House there is a wealth of experience and commitment to the values and work of this sector so it will be a pleasure to engage with colleagues as we take this Bill forward. The Bill is fit for purpose and I commend it to your Lordships. Moved, That the Bill be now read a second time.—(Baroness Andrews.)