Social Housing (Regulation) Bill [HL] - Second Reading

Part of the debate – in the House of Lords at 4:30 pm on 27th June 2022.

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Photo of Baroness Thornhill Baroness Thornhill Liberal Democrat Lords Spokesperson (Housing) 4:30 pm, 27th June 2022

My Lords, I draw the House’s attention to my role as a vice-president of the Local Government Association and a non-executive director of the Hertfordshire Housing Conference. From these Benches, I congratulate the noble Viscount on his maiden speech; I am delighted that he is joining the housing geeks, and I am sure that he will make an excellent contribution.

As always in your Lordships’ House, this has been a thorough and wide-ranging debate, from my noble friend Lord Foster’s comments on electrical safety to the timely reminder of the noble Baroness, Lady Hayman, about the importance of energy efficiency in poverty and quality housing. As ever, many points of detail will emerge during Committee, and I suspect that the Minister will have his hands full.

Many noble Lords have reminded us that the catalyst for this was the tragedy at Grenfell Tower and the subsequent shocking discovery that repeated concerns about fire safety were raised by residents but fell on deaf ears. In week 80 of the inquiry, evidence was found of

“wilful blindness and complacency towards safety”.

Those are strong and shocking words indeed. So all of us who are working on the Bill will work to change such negative cultures and root out and eradicate poor providers.

Conversely, many landlords are good or very good and are already actively changing their performance measures, becoming more transparent and engaging better with their tenants. They have not stood by and waited for the inquiry outcomes or for legislation to be passed, as was detailed by the noble Baroness, Lady Warwick of Undercliffe, in the role that she is, sadly, giving up soon.

Had my noble friend Lady Pinnock been allowed to speak—she was delayed by the same rail problems that have deprived us of the wisdom of the noble Lord, Lord Best—she would have said that we applaud and support much in the Bill. At its heart is the expansion of the powers of the Regulator of Social Housing and the removal of the “serious detriment” test; these are two sides of the same coin and must have equal balance. The removal of the “serious detriment” test is an essential tool to allow intervention before a crisis point, by which time it will or could be too late, as we know and as the right reverend Prelate the Bishop of Chelmsford pointed out.

I note the expanded Housing Ombudsman Service has seen a massive increase in casework, and it may take more than the memorandum of understanding to clarify all the roles and responsibilities and ensure effective partnership working to cut out duplication and overlap. These concerns were forensically dissected by the noble Lord, Lord Young of Cookham. I will also ask how the Government will ensure that both the regulator and the ombudsman have sufficient resourcing to enable them to effectively conduct their duties, as mentioned by the noble Lord, Lord Bourne of Aberystwyth, and the noble Baroness, Lady Watkins, whose comment about shared ownership was particularly pertinent—this was not something that I was aware of, and her points were very well made.

Giving the regulator Ofsted-style powers is fundamental to successful change. From my own experience—it was first introduced while I was assistant head in a large secondary school—I believe that it is the right way to go. At first, it was draconian, top-down, massively intrusive and a heavily judgmental process—a far cry from the friendly old inspectors and advisers we were used to seeing to, but largely ignored. However, it was a very, very necessary change. A key factor in its success was the certain knowledge that there would be very regular inspections, not a one-off so that schools could paper over the cracks, hope for the best during the inspection week and then breathe a sigh of relief when the inspectors left on Friday afternoon. It was known that they would be back and approximately when—it kept us on our toes for years, until we learned to absorb the new normal of continuous improvement and performance management. Therefore, we will be looking to strengthen the Bill along those lines.

I say to the Minister: because it will take time for the regulator to be tooled up with enough trained inspectors and for the whole inspection regime to be established, surely the regulator’s activity will initially prioritise intervention with landlords who are experiencing the most severe challenges. Will the Government then work proactively with the National Housing Federation and the Local Government Association to ensure that there is a proportionate, risk-based and outcomes-focused approach to inspection that satisfies everyone?

During the passage of this Bill, we want to look at broadening the focus of the inspection to also include each provider’s work on homelessness. The inspection process will, of necessity, mean that landlords will focus on what can be measured. We think that the homelessness provision aspect needs to be given some weight in any judgment. Surely it is also part of the regulator’s remit to look closely at why the landlord is failing, and not just to say that it is failing. Is it the endemic culture of the organisation or financial capacity? Each requires very different responses—and that is where the PIPs will be very important. For the former, change takes time, which is why we believe that reviews and more regular inspections will be needed. For the latter, with below-market rents being a very necessary feature of social housing, the reality of each landlord’s financial situation must be recognised.

To support council landlords, will the Government agree to prioritise reforms that remove the financial constraints on councils, including the ability to retain 100% of right-to-buy receipts with no restrictions on their use—I apologise to the Minister for sounding like a broken record on that issue—and reform social rent policy to allow a longer period of annual rent increases for a minimum period of at least 10 years? On the topic of money, it is also worth noting that, while the removal of the fine cap is a deterrent, could the Minister assure us that it is intended to be a penalty of last resort? This is because—as another noble Lord mentioned; I hope I will be forgiven for forgetting whom—tenants will, in effect, be the ones who pay that fine through their rent.

I say to the Minister that it is clear that there is a lot riding on this Bill, which is why we will be looking to put amendments down to look at regular reviews and progress of the whole sector as the years go by. If there is a weakness, we believe that it is around the tenant voice being heard, as was very passionately articulated by the noble Baroness, Lady Wilcox of Newport. Indeed, the residents advisory panel falls far short of a meaningful voice for tenants, and there is a real danger that, as it stands in the Bill, it will effectively just be a short-term token gesture. In this regard, we feel—to use my old teacher parlance—that the Bill could do better.

Finally, I want to put on record that despite the shameful tragedy of Grenfell and other high-profile failures of housing providers, it is still true that millions of people and their families living in one of the sector’s 4.5 million homes are, for the most part, glad to be in this sector rather than the private rented sector. As one resident said to me when I joined her when she moved into her brand-new council house, “I feel like I have won Willy Wonka’s golden ticket—a safe, stable roof over our heads, a rent I can afford and a landlord who appears to listen.” That is, always will be, and must be the sector’s mission. I look forward to working with your Lordships on this important Bill because, sadly, we know that this is not the case across the board or this Bill would not be here today and it would not have the very clear cross-party and outside consensus that it seems to command.