Housing and Regeneration Bill

It is hard to divorce that from the necessity of having the Secretary of State involved in that part of the process, for the reasons that I have explained. In any case, our amendment ensured that the Secretary of State may direct the regulator only if, in the Secretary of State's opinion, either the standard, or its content, related to one of three things: the quality of accommodation; involvement by tenants; and management by registered providers of accommodation. We added that because that is what the Bill is about: tenant involvement. We thought it sufficiently important to give it that prominence. On other issues, the Secretary of State can set objectives which the regulator must have regard to, but they are not binding and the regulator will consider them along with issues raised by other stakeholders. We also made two other amendments. We amended subsection (3) so that the Secretary of State must have regard to the regulator’s fundamental objectives when deciding whether to give a direction, so we have tied the hands of the Secretary of State in that way. Although the effect of a direction may be that the regulator has to strike a difficult balance between its objectives than it would otherwise have chosen to do, we think it only right that the regulator’s fundamental objectives should affect the Secretary of State as well as the regulator. We also introduced at subsection (5) a provision similar to that in Clause 194, requiring the Secretary of State to consult the Charity Commission on any directions that may affect charities to ensure that there is no breach of charitable status. The Secretary of State's powers to give directions in relation to standards was also intended to introduce a greater degree of transparency into the process, to pick up the point made by the noble Viscount, Lord Eccles. Cave recognised concerns about policy passporting: that obligations or pressures were being placed on registered providers to implement government policies without that being openly discussed or the sources of the obligations being clear. That is why subsection (4) requires the Secretary of State to consult the regulator, the HCA and representatives of registered providers and tenants of social housing before giving the regulator a direction. We will add the Audit Commission to that list. Through other amendments to subsection (8), we have further reinforced the transparency of the direction process by requiring the Secretary of State to publish not only the directions made but each proposed direction that is the subject of consultation and each response. It is an issue for the website, but it is very accessible and most people these days are very familiar with accessing websites. In response to the issue raised by the noble Lord, Lord Dixon-Smith, I hope that this will serve as a response to the DPRC report, but we replied to that report—it looks as if he has already seen that reply. Finally, subsection (6) provides for a situation where the Secretary of State issues a direction that is adopted intact by the regulator as a performance standard. Frankly, it will be pointless for both bodies to consult the same consultees on the same issue. Where the final standards differed from the direction they would probably have to be a second consultation. I hope that I have been able to reassure noble Lords that this has been an iterative and open process which, in its evolution, has changed the balance in the Bill between the regulator and the Secretary of State. It has embedded the independence of the regulator, while giving some residual but very necessary powers to the Secretary of State. That is a proper balance. It has certainly been a proper parliamentary process. On that basis, I hope that noble Lords will agree that the clause should stand part.