Clause 38 - Meaning of “domestic PR property” and “non-domestic PR property”: England and Wales

Energy Bill [Lords] – in a Public Bill Committee at 10:30 am on 14th June 2011.

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Photo of Zac Goldsmith Zac Goldsmith Conservative, Richmond Park 10:30 am, 14th June 2011

I beg to move amendment 128, in clause 38, page 24, line 22, at end insert ‘or

(iv) classified as Service Family Accommodation;’.

Photo of Edward Leigh Edward Leigh Chair, Public Accounts Commission, Chair, Public Accounts Commission

With this it will be convenient to discuss the following:

Amendment 129, in clause 64, page 44, line 7, at end insert—

(v) properties classified as Service Family Accommodation;’.

Amendment 130, in clause 65, page 47, line 5, at end insert—

(v) properties classified as Service Family Accommodation;’.

Amendment (a) to Government amendment 66, in line 5, at end insert—

‘(2A) In section 1 of that Act (interpretation) in the definition of “residential accommodation”, insert—

“(c) properties classified as Service Family Accommodation.”.’.

Photo of Zac Goldsmith Zac Goldsmith Conservative, Richmond Park

I will be brief, because there are some meaty amendments to be dealt with today. The intention in amendments 128 to 130 and in amendment (a) to Government amendment 66 is to tackle the poor energy efficiency performance of service family accommodation. Amendment 128 would amend the definition of domestic private rented property to include service family accommodation. It would clarify that any future regulation of the energy efficiency of domestic private rented properties must include SFA properties, of which there are about 50,000 in the country. Amendments 129 and 130 would designate service family accommodation as a type of property needing to benefit from energy company  obligation or ECO subsidies, potentially to complement the green deal, given the hard-to-treat nature of SFA properties. Amendment (a) to Government amendment 66 to clause 105 would amend the definition of “residential accommodation” to include SFA properties.

Hon. Members will be aware of the issues relating to the condition of service family accommodation. I have lobbied the Ministry of Defence to refurbish armed forces accommodation in north Kingston, in my constituency, and I am pleased to say that work is finally under way.

According to a survey by the National Audit Office, almost one third of service families describe the condition of their house as poor. Along with the bathroom and the kitchen, energy efficiency was one of the three biggest sources of complaints. Some 1,500 assessed SFA properties are in the bottom two standards, out of four, for condition; 23,400 properties require solid wall insulation and 13,000 properties require loft insulation.

If we ask servicemen and women to risk serious injury or death as a result of their duty, the least we can do is accommodate them and their families in warm homes. I recognise that the MOD already has a long-term commitment—this is within a 20-year time frame—to upgrade all its properties, and that SFA properties are technically eligible to benefit from the green deal already, but I am concerned about the scale of the ambition. In March, I wrote to my right hon. Friend the Secretary of State for Defence, urging his Department to be a first mover with respect to the green deal, given the potential cost savings both to the SFA tenants and to the departmental budget, but unfortunately I have yet to receive a response.

As service personnel and their families pay their own utility costs, the savings that would arise from improving the energy efficiency of their properties would deliver real financial help. The amendments make it plain that the MOD, acting in effect as a social landlord—it is not a registered social landlord—must act. I very much hope that my hon. Friend the Minister will take on board the amendments and pursue the MOD as vigorously as is required.

Photo of Luciana Berger Luciana Berger Shadow Minister (Energy and Climate Change)

We support the hon. Gentleman’s amendments. They make valid points that currently are not dealt with in the Bill. We look forward to the Minister’s response in the hope that he supports them, too.

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change

Good morning, Mr Leigh. With your permission, before I respond to the very important issues raised by my hon. Friend the Member for Richmond Park, I will briefly update the Committee on progress on the commitments that I made last week. At the suggestion of the hon. Member for Brighton, Pavilion, I agreed to share our working summary of the secondary legislation with the Committee. As a result, I have brought copies for distribution today, and I am happy to provide electronic copies also.

The hon. Member for Ogmore and my hon. Friend the Member for Devizes, among others, raised the important issue of water efficiency. Committee members will be interested to know that I have written to my colleagues in the Department for Environment, Food and Rural Affairs to pass on the Committee’s and my encouragement  for it to investigate further the potential for a blue deal. I indicated my Department’s willingness to share all our experience and understanding in working up the green deal with DEFRA in building up its new proposition, and I look forward to a constructive ongoing dialogue.

I assure the hon. Member for Southampton, Test, that any updated measures paper will take into account the points made in Committee. We intended the next iteration to be after the consultation in the autumn, but if it would aid scrutiny in Committee, I am happy to produce an earlier version by the end of this month.

I agreed to meet the hon. Member for Liverpool, Wavertree, and her colleagues to discuss interest rates and the golden rule, and that informal meeting has been arranged. In response to concerns raised in Committee, I have instructed my officials to investigate the strengthening of assessor impartiality in the Bill. I am happy to say that we therefore intend to insert a statement in clause 3(4), so that the code of practice can make provision about the impartiality of assessors, and I commit to doing that. I am still open to having a meeting with interested members of the Committee, but I hope that that will give sufficient reassurance to the hon. Members for Wansbeck, for Hyndburn, and for Rutherglen and Hamilton West, and to my hon. Friends the Members for Wells, for Stourbridge, and for Winchester, all of whom voiced concerns on that issue.

The hon. Member for Liverpool, Wavertree, inquired about her freedom of information request. As I explained last week, I have asked all contributors to contact the Energy Public Bill Committee directly, and I understand that many have done so. The Clerk has agreed to compile a list, so that the Committee can decide whether to view them.

On my Department’s work with the Cabinet Office’s behavioural insights team, I said that I would provide an update to the Committee as soon as possible. We expect a report to be published on its website in early July, and I will pass on the address as soon as I receive it.

The hon. Members for Brighton, Pavilion, and for Southampton, Test, pressed me on the crucial issue of consent. As I explained last week, that issue relates to property law and rests primarily with the Department for Communities and Local Government. We will therefore work across Departments, and I have written to my right hon. Friend the Minister for Housing and Local Government to seek his agreement to the general approach, and to raise the important issue of retaliatory evictions, which we will move on to later. To assist us, I intend to set up a stakeholder group to consider the issues in more detail and to report back with its findings by the end of the summer.

In conclusion, I very much appreciate the constructive engagement of the Committee on the complex and wide-ranging issues around the Bill, and I am sure that this week will be as productive as last week.

Photo of Huw Irranca-Davies Huw Irranca-Davies Shadow Minister (Energy and Climate Change)

It is good to be under your stewardship again, Mr Leigh. I compliment the Minister on his progress since the last Committee sitting. It suggests that he is showing great good will in working with the Committee, for which I thank him. Will he clarify his intention as regards the vote on green apprenticeships at the end of the last Committee sitting, when the Government ceded, or at least did not  vote against, our amendment? Will it rest in the Bill, or will he bring back an amendment on that subject at a future date?

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change

I will clarify that point. My understanding is that it was a procedural matter that we had not anticipated, and that its was unusual for the amendment to have been voted on when it was. I will seek further guidance from my officials, because we did not anticipate that it would sit in the Bill. I will update the hon. Gentleman of our exact intentions later, but I believe that we will introduce new wording.

Photo of Caroline Lucas Caroline Lucas Leader of the Green Party

I, too, thank the Minister for the generous way in which he has taken on board our suggestions, and for coming back to the Committee on them so quickly. He mentioned a meeting with the hon. Member for Liverpool, Wavertree, on interest rates. If there were any chance of widening that meeting to include all interested stakeholders, I would be interested in attending it.

Photo of Edward Leigh Edward Leigh Chair, Public Accounts Commission, Chair, Public Accounts Commission

Order. For the avoidance of doubt, I have checked with the Clerk, and the amendment on Thursday afternoon was called at precisely the right moment.

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change

I stand corrected, Mr Leigh. Nevertheless, we shall be seeking new wording. The hon. Member for Brighton, Pavilion, will be particularly welcome at the meeting, as will other members of the Committee.

I turn to the amendments tabled by my hon. Friend the Member for Richmond Park. I strongly support his intention to improve the energy efficiency of MOD accommodation. On amendment (a) to amendment 66, I can confirm that local authorities are already required to report on their action to improve service family accommodation under the Home Energy Conservation Act 1995, into which we are determined to breathe new life. The definition of residential accommodation in the Act includes service family accommodation.

Amendment 128 would include service family accommodation in the definition of domestic private rented property, but there are several reasons why we might not want such homes to be caught by the private rented sector policy. PRS regulations are targeted at commercial landlords who rent their properties at market rates. In comparison, the Ministry of Defence cannot be classed as a commercial landlord. It offers subsidised housing and makes no profits from the properties. Additionally, its accommodation is occupied under licence, as opposed to under the tenancy agreements that form the basis of PRS properties, which are caught by the PRS provisions under the Bill.

However, my hon. Friend is absolutely right: the houses need to be improved and, in some cases, the solution will require far more extensive and costly improvements than have been supported in previous programmes under previous Governments. As a result and at my hon. Friend’s urging, my officials have been discussing with the Ministry of Defence how our energy efficiency policies might help, and I have asked them to set up a joint working group to look specifically, as a matter of urgency, into improving the energy efficiency of service family accommodation. On the face of it, the type of measures required in the properties, such as solid wall insulation, can be expected to be the bread and butter of the new energy company obligation.

The energy companies will be actively looking to take an area-based approach, tackling groups of properties of similar construction so that they can achieve economies of scale. Ministry of Defence properties should be highly suitable for such an approach, with the additional advantage of having a common landlord. My officials will continue to engage with the Ministry of Defence to examine whether any factors would work against MOD housing benefiting under the green deal and ECO, and I am happy to include my hon. Friend the Member for Richmond Park in that process. We will consider whether there should be specific focus on those properties under future implementing regulations.

I assure my hon. Friend that powers already exist in the Bill to enable us to target properties of a specified description. If a specific regulatory focus on service family accommodation were needed, those powers would allow us to introduce that specific focus without the need for the changes proposed under amendments 129 and 130. I share his concern to ensure that we do our very best for service family accommodation, not only because we need to make sure that it is included in the retrofit of United Kingdom housing stock to ensure that we meet our climate change targets, but because our service families deserve to live in warm, efficient and comfortable homes. With my assurance that MOD properties will be improved under our new proposals, I ask my hon. Friend to withdraw his amendment.

Photo of Zac Goldsmith Zac Goldsmith Conservative, Richmond Park

I thank the Minister for his words, and for the commitments that he has made. I should be pleased to take him up on his offer to join the discussion group with the MOD. I therefore beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change 10:45 am, 14th June 2011

I beg to move amendment 133, in clause 38, page 24, line 30, after ‘housing,’ insert—

‘(aa) it is low cost home ownership accommodation within the meaning of section 70 of that Act,’.

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change

Further to the announcement made by the Secretary of State on Second Reading, I am pleased to introduce this suite of Government amendments, which seek to introduce a minimum energy efficiency standard in the domestic private rented sector. We have listened very carefully and responded accordingly. We are moving to a much firmer legislative position. Under amendments 126 and 145, and with clauses 39 to 41 no longer standing part of the Bill, our regulations will no longer be conditional on a review, and there will a duty on the Secretary of State to make the regulations. Landlords will now know what is required—

Photo of Edward Leigh Edward Leigh Chair, Public Accounts Commission, Chair, Public Accounts Commission

Order. If the Minister is talking about Government amendments 126 and 145, they are grouped under clause 39. We should now be debating Government amendments 133 and 134 under clause 38. I am happy to give the Minister a moment to collect his thoughts.

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change

I apologise. The amendments relate to the definition of the private rented sector for the purpose of chapter 2. Government amendment 133 seeks to clarify that low-cost home ownership accommodation will be excluded from the definition of domestic private rented property. Low-cost home ownership accommodation is designed to allow people to buy part of a property and rent the remaining part. Without the amendment, in many cases the tenancy agreement portion of the arrangements would mean that such properties could be caught by the regulations. However, from a policy perspective, this form of accommodation should be excluded, because it is designed to support home ownership rather than renting. It should therefore be treated in the same way as owner-occupier property for the purposes of the green deal.

Government amendment 134 is a minor, legal, technical amendment. I am advised that we do not need the words

“or any regulations replacing those regulations”,

as existing provision in the Interpretation Act 1978 makes those words otiose.

Photo of Huw Irranca-Davies Huw Irranca-Davies Shadow Minister (Energy and Climate Change)

I support the amendments, because they seem straightforward and technical. However, although I understand the logic that the Minister has just outlined—low-cost home ownership is excluded because, by definition, it is owned rather than rented—does he, or his officials, see any danger that the wording of Government amendment 133 could include any other form of low-cost accommodation? Is he content that it will be focused purely on shared ownership? Is the definition tight enough to encompass what he wants and not to expand any wider?

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change

I appreciate the point that the hon. Gentleman is raising, but having taken advice, I can assure him that it deals specifically with ownership. It does not encompass a wider definition.

Amendment 133 agreed to.

Amendment made: 134, in clause 38, page 24, line 35, leave out

‘or any regulations replacing those regulations’.—(Gregory Barker.)

Photo of Luciana Berger Luciana Berger Shadow Minister (Energy and Climate Change)

On a point of order, Mr Leigh. I seek clarification: the Government tabled amendments 135 to 137, which seek to remove clauses 39, 40 and 41, but those amendments are not included on the selection list. For the benefit of new hon. Members, will you explain how that will work?

Photo of Edward Leigh Edward Leigh Chair, Public Accounts Commission, Chair, Public Accounts Commission

It is complex, but I assure the hon. Lady that all the amendments that she is interested in will be debated in the right order. Amendments 135 to 137 relate to matters later in the Bill, and they will be debated when we come to those. I assure her that there will be no problem. We do not select an amendment that removes a clause, because the Committee will come to that decision anyway—that is the rule of the House.

Clause 38, as amended, ordered to stand part of the Bill.