Housing and Regeneration Bill

moved Amendment No. 1: 1: Schedule 1, page 151, line 39, at end insert ““by way of grant. (2) Such payments may be made on such terms and conditions as the Secretary of State considers appropriate.”” The noble Baroness said: My Lords, this first group looks like a formidably long list of amendments but, in speaking to them, I hope to make logical sense of them all. I shall begin with Amendments Nos. 1 and 39, which are technical. In the event that the Secretary of State makes grant payments, under Amendment No. 1, or loans, under Amendment No. 39, to the Homes and Communities Agency, those grant payments or loans will be on such terms and conditions as the Secretary of State considers appropriate. The terms and conditions are a matter for the Secretary of State and will reflect the overall strategic framework for the HCA. Setting out the detail in legislation would be inappropriate and would remove flexibility for the future and for changing circumstances. Amendments Nos. 3 and 67 are, again, highly technical. The first part of Amendment No. 3 to paragraph 10 of Schedule 1 allows a committee of the HCA to delegate any function conferred on it to any of its sub-committees or to any staff of the HCA. This allows the HCA flexibility in delegating to its committees. The second part of the amendment to paragraph 10 works with the separate amendment to Clause 46 to ensure that the provisions in the Bill which enable the HCA to delegate its functions and appoint agents to exercise its functions on its behalf work correctly together. To explain further, the main aim of new subsection (3) proposed in Amendment No. 3 is to ensure that the power of the HCA to delegate its functions in paragraph 10 of Schedule 1 works with the power of the HCA to appoint agents to exercise functions on its behalf. Noble Lords will appreciate that, as a statutory body, the HCA has both implied and certain specific powers to appoint agents; for example, under Clause 45. Those permit the agency, for example, to appoint agents for day-to-day activities, such as appointing a contractor to act as agent in the delivery of mail, in relation to selling land or in office administration. In these cases, there is no need for specific statutory authority for those implied powers. However, a specific statutory power to appoint an agent is given to the HCA in Clause 45, where it is permitted to appoint an urban development corporation to act as agent in relation to certain specified functions. Proposed new subsection (3) of the amendment to paragraph 10 of Schedule 1 ensures that Clause 45 is correctly interpreted so as not impliedly to limit the HCA’s ability to appoint agents for its day-to-day functions. Amendment No. 67 to Clause 46 is also intended to ensure that no doubt is cast in relation to the extent of the HCA’s implied powers, and so it is proposed that subsections (3) and (4) are deleted. Basically, these technical amendments provide clarity on how the HCA’s delegation and agency powers will work. Amendments Nos. 40, 41, 42, 65, 66, 70, 71, 72 and 86 are, again, technical and relate to the relationship between the HCA and its subsidiaries. The principle of that relationship is as set out in Clause 44 as amended. We want to ensure that the HCA’s subsidiaries work within the same constraints as the HCA itself, to make certain that subsidiaries cannot do what the HCA cannot do and to ensure that the HCA cannot use its subsidiaries to circumvent any restrictions placed on it in statute. It is an unlikely scenario but one that we consider important for the Bill to cover. It is subject to an important qualification. To award some flexibility to subsidiaries, Amendment No. 40 provides that they can gain the consent of the Secretary of State to undertake activities that the HCA is precluded from undertaking. In the event that a subsidiary can illustrate that it has particular need or reason to undertake something the HCA might be prevented from doing in statute, it can do so, but only with the consent of the Secretary of State. We do not at present envisage any particular activities that would fall within this category but we think that it is appropriate to allow for future flexibility. For example, if the subsidiary wished to charge for activities which the HCA was not permitted to charge for, it would require the consent of the Secretary of State. Amendments Nos. 40 and 42 ensure that when the HCA is subject to borrowing limits and any surplus funds direction, the borrowing limits and surplus funds of any subsidiaries are also taken into consideration. Amendment No. 40 provides that references to the HCA’s borrowing limit include any borrowings of its subsidiaries, which will prevent the HCA circumventing the financial limits imposed on it in Clause 26 through the use of subsidiaries. Equally, in circumstances where the Secretary of State is considering whether to give a direction as to the repayment of the surplus funds, Amendment No. 42 makes sure that any surplus funds being considered include those of all HCA subsidiaries. Amendments Nos. 70 to 72 ensure that third parties dealing with subsidiaries of the HCA are extended the same protection as they would if they were dealing with the HCA itself, under Clause 56, on the validity of transactions. This means that all the protections afforded to third parties entering into a transaction with the HCA also apply to transactions with the HCA’s subsidiaries. Amendment No. 86 adds the definition set out in Clause 25(5) to the list of definitions at the end of Part 1. To conclude on this group, these amendments ensure that subsidiaries of the HCA cannot do what the HCA cannot do and that the HCA cannot use them to circumvent any restrictions placed on it in statute, while allowing for some appropriately circumscribed flexibility through the consent of the Secretary of State. I turn to the much shorter Amendment No. 69—I seem to have lost this amendment, so I shall move on to Amendments Nos. 73, 76 to 79, 199 and 201. These are technical or clarifying amendments to existing legislation to ensure that it will accurately reflect the world should this Bill be granted Royal Assent. I do not intend to take your Lordships through each of them line by line, but I shall highlight those of particular interest. Amendments Nos. 76, 77 and 78 and the second part of Amendment No. 79 relate to taxation legislation. The intention behind all tax-related consequential amendments is to ensure that the current tax position will be maintained once the new bodies come into being. The amendments do not impose new burdens or lift old ones; they simply reflect the changes in structure that this Bill will bring about. The first part of Amendment No. 79 relates to planning legislation. The Planning and Compulsory Purchase Act 2004 is clarified to provide that, where plan-making functions are conferred upon the HCA, these may not be conferred concurrently with the existing local planning authority. This amendment was withdrawn in Committee in response to a request from the noble Baroness, Lady Hamwee, who was concerned that passing it then might prejudice consideration of Clauses 13 and 14. They have now been discussed, and I bring the amendment back unchanged. Amendments Nos. 73 and 75 refer to issues surrounding Crown land. They alter the scope of Crown exemption, reducing it in respect of the Welsh Ministers acting in the capacity of the residuary body for new towns in Wales. So they are tidying up amendments, but still very important. I have now found my brief on Amendment No. 69. It is a simple amendment, which adds the regional development agencies to the list of bodies in Clause 53(1)(a). This means that the Secretary of State will be able to make a scheme for the transfer to the HCA of property, rights and liabilities from the RDAs to the HCA. In particular, the clause will allow for the transfer of the assets and liabilities of the Academy for Sustainable Communities from its host organisation, the Yorkshire and Humber Development Agency, to the HCA. Amendments Nos. 82 and 84 are technical; they are intended to ensure that the HCA does not inadvertently act outside its powers while trying to comply with its duties. To clarify, where the HCA has statutory duties, it must carry them out whether or not they conflict with its objects. For example, the duty to hand over surplus funds to the Secretary of State under Clause 28(2) may not fit easily with the HCA’s objects, but it has to pay over the money regardless. In this circumstance, the HCA is handing over surplus funds because the Secretary of State has directed it to do so and not, strictly speaking, for the purposes of its objects or for purposes incidental to them, as in Clause 4(2). If Clause 4(2) was applied to the duty imposed on the HCA by Clause 28(2), it would put the agency in an impossible position. Similarly, that duty might well cut across Clause 3, so falsifying Clause 4(5). Our amendment effectively confines Clause 4 to ““pure”” powers, as opposed to powers contained in duties. Amendment No. 84 adds the definition set out in Clause 59(2) to the list of definitions. Amendments Nos. 102 and 103 concern the housing ombudsman. Clause 124 ensures that registered providers are required to be members of the housing ombudsman scheme in future, as registered social landlords are at present. Noble Lords will know how well the ombudsman does his job, which is to deal with individual complaints from housing association tenants when they cannot be resolved by the landlord. At present, registered social landlords who cease to be registered are required to remain as members of the ombudsman scheme. The amendment ensures that the requirement to maintain membership of the ombudsman scheme will extend to bodies that have been de-registered by the regulator only if those bodies continue to own or manage publicly funded dwellings. If they cease to own or manage such properties, we do not think there is a need for them to be required to remain part of an ombudsman scheme. Amendments Nos. 154 to 157 are consequential to tax legislation. They do not change policy; they simply ensure that the status quo is preserved in the new system. In particular, they ensure that tax benefits currently available to RSLs continue to be available in future to their successors—that is to say, non-profit providers of registered social housing. The amendments are technical and consequential but essential to ensure a smooth transition to the new system. Amendments Nos. 151 and 153 simply ensure consistency through the Bill by adding a definition of a local housing authority. Previous drafts of the Bill had very few references to local housing authorities; hence the reference in Clause 114 included its own definition. We are now adding to the regulator certain requirements to consult representatives of local housing authorities, and it therefore seems sensible to include a single definition covering all the references. I think the two final sub-groups will be particularly interesting to noble Lords—even more interesting than the ones I have just spoken to. I think that Members on both sides of the House will welcome them. I have tabled Amendment Nos. 11 and 14 in response to an issue raised by the noble Lord, Lord Greaves, in Committee. He argued that commons are special places with a crucial role to play in the life of communities. He is quite right. He argued that they should be subject to special protection and that their role in community life should be cherished. He was quite right about that too. It is against that background that a potential threat to the current protection for commons was identified where that land is acquired by agreement by the HCA. I am sorry that the noble Lord is not in his place for me to pay tribute to his vigilance and forensic skill in that respect. However, before addressing that issue, let me be clear that in cases where the agency compulsorily acquires any land forming part of an allotment, open space or common, the protection found in the Acquisition of Land Act 1981 will apply. This requires that, where a compulsory purchase of this land occurs, it must be subject to special parliamentary procedure, including a public inquiry and being brought before Parliament, unless certain exceptions apply. Commons are therefore subject to the highest form of protection in respect of acquisition by a compulsory purchase. Following the undertaking of the noble Lord, Lord Bassam, to review the position, however, it has become clear that where the HCA acquired common land by agreement, there was a risk that the protection afforded to this land by the Commons Act 2006 could be overridden. The amendments ensure that the protections in that Act apply to the HCA. The first amendment is slightly technical. The definition of common land given in Clause 9(7) replicates the definition in the Acquisition of Land Act 1981. However, by referring to that Act directly in the Bill we can ensure that, if the 1981 definition is amended in future under powers in the Commons Act, the amended definition will apply equally to this legislation. More substantially, we have removed Part 4 of Schedule 3. This brought forward the existing powers of the Urban Regeneration Agency and allowed the HCA, despite any other legislation, to use a common, open space or allotment in any way subject only to planning permission. Ordinarily, a developer wishing to use common land for a large-scale development without resort to powers of compulsory purchase will require the consent of the Secretary of State under Section 16 of the Commons Act 2006. Part 4 of Schedule 3 would have allowed the HCA to override that requirement. However, I assure noble Lords that it was never our intention that the HCA should be placed in a position superior to other developers in relation to common land, and we are happy to ensure that the HCA is subject to the same controls as any other developer should it want to develop common land acquired by agreement. Finally, Amendments Nos. 98 and 99 in this group are on a slightly different subject. The noble Earl, Lord Onslow, raised this matter in Grand Committee, but unfortunately we could not debate it then. He is not in his place, but I should say that we were grateful to him for tabling his amendments in Grand Committee because they were originally proposed by the Joint Committee on Human Rights, of which he is a member. Both his amendments and mine are to Clause 110, which relates to information disclosure. Briefly, Clause 110(1) provides that a public authority may disclose information to the regulator for a purpose connected with the regulator's functions. Subsection (2) provides a reciprocal disclosure power to the regulator, but stipulates that such a disclosure can be for a purpose connected with either the regulator's functions or the receiving public authority's functions. The Joint Committee is concerned that the information-sharing gateway provided by Clause 110 is too broad and might be incompatible with Article 8 of the European Convention on Human Rights. The Joint Committee recommended that the current test—that information is for a purpose connected with the regulator's functions or the public authority's functions—should be replaced with a necessity test that information may be shared only when it is necessary to perform those functions. We do not share the Joint Committee’s concerns about the ECHR compatibility of Clause 110. In particular, it is important that we do not see the clause in isolation. Subsection (5) makes it clear that the powers provided by the clause are subject to any express restrictions on disclosure imposed by other enactments. Those enactments include the Data Protection Act, which already provides significant protections, and the Human Rights Act, to which the regulator, as a public authority, will be subject. Notwithstanding that, it is right to address the Joint Committee’s concerns, which is the intention behind the amendments. If the House agrees, the amendments will ensure that a public authority may disclose information to the regulator only if the public authority thinks that the disclosure is necessary for a purpose connected with the regulator’s functions, and that the regulator may disclose information to a public authority only if the regulator thinks that the disclosure is necessary for a purpose connected with the regulator’s functions or with the public authority’s functions. The amendments will impose a necessity test on the sharing of information between the regulator and other public authorities, but this is consistent with the Joint Committee’s recommendations. These government amendments are slightly different from the amendments that were recommended by the Joint Committee and which the noble Earl tabled previously. His amendments were rather more straightforward than mine. They would merely have inserted ““which is necessary”” into subsections (1) and (2). My amendments specify that the applicable test is whether the discloser of the information thinks that it is necessary. This extra detail is because we felt that the Bill should be specific about whose opinion the necessity test is based on. Unless we specify that, the clause could be open to a wide interpretation. Such ambiguity would be unhelpful to those who will have to operate the clause in practice and to the courts that may one day have to interpret it. I hope that these amendments, together with the existing safeguards provided by the Data Protection Act and the Human Rights Act, will reassure noble Lords and the Joint Committee. I beg to move.