Housing and Regeneration Bill

There have been some interesting contributions during this short discussion. The amendments are very helpful. The clause allows the regulator to issue directions to registered providers of social housing covering the production of accounts for social housing activities. The purpose of such directions must be to ensure that accounts are prepared in a proper form and to give a true and fair view of the social housing activities undertaken and the use of funds and assets connected with those activities. The noble Viscount, Lord Eccles, has got it right: this is a carryover power or existing power of the Housing Corporation, although it has been amended in this Bill in some respects—for example, to ensure that it applies to profit-making providers as well as non-profit providers. The regulator may use his discretion power in ad hoc situations, in relation to one provider or more—usually to issue a general direction to all registered providers. Any directions issued to a number of registered providers can be introduced only after consultation with one or more bodies appearing to represent the interests of registered providers. Amendment No. 107E, in the name of the noble Lord, Lord Dixon-Smith, would in effect give the Secretary of State a power, not a duty, to issue guidance on the form of registered provider’s accounts. We do not agree that this would be a desirable outcome. There is no suggestion elsewhere in the Bill that the Secretary of State should issue guidance on providers’ accounts, nor is this a part of the current regulatory system. Our intention is to set up a regulator with substantial independence from central government directions and guidance. To our way of thinking, the logic of the legislation would suggest that it would be counterproductive to require central guidance on something so technical and detailed. I agree that when setting directions the regulator may need accounting advice from professional bodies. I do not think that anyone would argue about that. But in more general terms, the regulator is best placed to decide what accounting information it needs. The Secretary of State will not have any specific knowledge or expertise on the sectors’ accounting arrangements. Amendment No. 108, tabled by the noble Viscount, Lord Eccles, proposes a subtle change in wording in Clause 127(1), which currently states: "““The regulator may give directions to registered providers about the preparation of their accounts””." The amendment would change that to, ““The regulator may from time to time determine requirements to registered providers about the preparation of their accounts””. Our view is that this will not change the effect of the clause. Under the revised wording, the regulator still would be able to give directions to registered providers about the preparation of their financial accounts. But we understand that the noble Viscount’s intention is to question whether the power in Clause 127 could be weakened slightly. Our argument is that these directions are necessary to ensure that accounts are prepared in a proper form. Without this power to direct, the regulator cannot be sure of getting the information it needs at an early stage to identify financial problems within an organisation. In part, it takes account of the argument raised by my noble friend Lady Dean on the need to have that overall picture and to understand more about the totality of the organisation even where it is not directly, in part of its group activity, dealing with social housing. I am grateful to Members of the Committee for their amendments, which have been very helpful. I hope that that answers the points raised.