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Housing and Regeneration Bill

moved Amendment No. 110AG: 110AG: Clause 252, page 103, line 4, leave out ““non-profit”” The noble Baroness said: I shall move a group of amendments, starting with this amendment, which extend the regulated transfers of social homes to include all homes owned by a registered provider. Previously, this power was used only for non-profit-making housing associations. These amendments permit it to be used for profit-making organisations. The power to order a transfer is an existing power of the Housing Corporation, which is rarely used and is a last resort when an association has no viable future and has failed to find a workable solution on its own. The Bill provides that the exercise of a power must be preceded by an inquiry, only if the regulator is satisfied that there has been mismanagement, a breach of standards or if the transfer would improve management of the land. As with other enforcement powers under Clause 215, the regulator must consider the materiality of any breach and the desirability of providers to manage their own affairs. The Secretary of State’s approval is needed. The decision of the regulator and the Secretary of State could be judicially reviewed. After consideration, we decided that applying this power to profit-making bodies was necessary to ensure that the social homes that they owned were completely secure. This power is not needed when a profit-making provider becomes insolvent, because the insolvency powers in the Bill can be used to secure the homes. However, we decided that the power was necessary if there was a serious risk that the profit-making provider would become insolvent or was running the homes so poorly that there was no other recourse than for the regulator to be able to take them away. Most of the amendments simply remove ““non-profit”” and apply Clauses 252 and 253 to profit-makers. The key amendment is Amendment No. 110AM. It specifies, first, that only social housing and associated land held by a profit-making provider can be transferred, whereas all of a non-profit-making provider’s assets and liabilities can be transferred. Secondly, the amendment states that land cannot be transferred from a non-profit to a profit-making provider, although the reverse is possible. I shall explain why we arrived at that position, which superficially may not seem fair. After all, if the regulator can transfer non-social housing assets owned by a non-profit-making provider, why not allow the same for a profit-maker? Why not level the playing field? The reason is that there are several principles in play; it is not only a matter of having a level playing field. It is important to recognise that the Housing Corporation does not use the transfer of land power as a punishment but to preserve assets that have received some public funding and which are used for the benefit of social tenants and the community. Most housing associations own assets that may at some point in the past have been partly publicly funded but are not strictly social housing, so it is right that the regulator should be able to save these. By contrast, the profit-making sector has no historical legacy of social housing assets. The regulator has no interest in seeking to transfer its market homes or other assets to a registered provider. In fact, it would be unnecessary and inappropriate to seek such powers. With housing associations, the regulator has a general duty of care; with the profit-making sector, its main care is to ensure that social homes are not lost. Amendment No. 110AP is consequential on Amendment No. 110AM. If the regulator transfers non-profits land to itself temporarily, which it may have to do if no suitable transferee is available, under the amendment it cannot later transfer the homes to a profit-maker. I beg to move. On Question, amendment agreed to.