Action for breach of duty under paragraph 1

Part of the debate – in the House of Lords at 1:30 pm on 16 September 2004.

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Photo of Lord Bassam of Brighton Lord Bassam of Brighton Government Whip, Government Whip 1:30, 16 September 2004

First, I thank all noble Lords who contributed to the discussion. It lasted longer than I would have expected, although that is probably quite reasonable under the circumstances. A fair amount of information was given from our side of the Dispatch Box on disclosing how the scheme is to work. I thought that we would have more questions on it. I am grateful for the questions that were raised and for the useful contributions. I shall try to deal with them in turn.

The noble Lord, Lord Hanningfield, was concerned about the costs of the scheme. The noble Lord, Lord Lucas, asked how much it would cost per tenant. I cannot give the noble Lord, Lord Lucas, an answer; we do not have an estimate. But, in essence, the scheme should be self-financing, as I said earlier when moving the amendment.

It was also suggested by the noble Lord, Lord Best, that perhaps we needed to finesse some of the detail. I join the noble Lord in paying tribute to the voluntary organisations—in particular, Shelter and NACAB—and the local authorities, which have been very helpful in putting together this set of propositions. Their experience has been valuable.

We have consulted fairly thoroughly. As I said earlier, we have drawn on two useful pilots, and we consulted on tenancy deposits between November 2002 and February 2003. That was a very useful exercise. We published a full response to the consultation paper, which is available on our departmental website.

I was asked whether tenancy deposits can be used to offset rent arrears. That makes a great deal of sense. If a tenancy agreement states that, then of course the deposit can be used to offset arrears of rent. I am sure that that will become well established practice.

The noble Baroness, Lady Gardner, asked whether landlords will have to become members in order to use a tenancy deposit scheme. The answer is: no. The custodial scheme at least will be open to anyone without membership. We think that insurance-based schemes are more likely to be used by larger-scale landlords, and I am sure that there will be a benefit in that. We believe that the schemes should be accessible and that the system that we are likely to see adopted will enable that to happen.

The noble Baroness also asked whether landlords can demand a six-week deposit. There is nothing to stop landlords and tenants agreeing to six-week deposits in terms of these provisions. That should be helpful to landlords who want to ensure—