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Title    : Scottish Parliament: Committees: Social Justice: Official
Reports: Meeting 2, 2001
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Text

Session 1 (2001)  
Scottish Parliament
Social Justice Committee
Official Report 
Meeting  2, 2001 

--------------------------------------------------------------------------------
 
17 January 2001 
CONTENTS

Wednesday 17 January 2001


SOCIAL JUSTICE COMMITTEE 2ND MEETING 2001, SESSION 1 
DEPUTY CONVENER 
ITEMS IN PRIVATE 
HOUSING (SCOTLAND) BILL: STAGE 1 

 

SOCIAL JUSTICE COMMITTEE
2nd Meeting 2001, Session 1

CONVENER

*Johann Lamont (Glasgow Pollok) (Lab)

DEPUTY CONVENER

*Ms Sandra White (Glasgow) (SNP)

COMMITTEE MEMBERS

*Brian Adam (North-East Scotland) (SNP)
*Bill Aitken (Glasgow) (Con)
*Robert Brown (Glasgow) (LD)
*Cathie Craigie (Cumbernauld and Kilsyth) (Lab)
*Karen Whitefield (Airdrie and Shotts) (Lab)

*attended

THE FOLLOWING ALSO ATTENDED:

Mr Michael McMahon (Hamilton North and Bellshill) (Lab)

WITNESSES

Douglas Blair (Scottish Executive Development Department)
Gavin Corbett (Chartered Institute of Housing in Scotland)
Tim Ellis (Scottish Executive Development Department)
Alan Ferguson (Chartered Institute of Housing in Scotland)
Beverly Francis (Scottish Executive Development Department)
Richard Grant (Scottish Executive Development Department)
Geoff Huggins (Scottish Executive Development Department)
Murray Sinclair (Scottish Executive Development Department)
Michael Thain (Chartered Institute of Housing in Scotland)

CLERK TO THE COMMITTEE

Lee Bridges

SENIOR ASSISTANT CLERK

Mary Dinsdale

ASSISTANT CLERK

Rodger Evans

LOCATION

The Hub

--------------------------------------------------------------------------------
 
17 January 2001 
Scottish Parliament

Social Justice Committee

Wednesday 17 January 2001

(Morning)

[THE CONVENER opened the meeting at 10:01]

Deputy Convener

The Convener (Johann Lamont): I welcome members to this meeting of the
Social Justice Committee. The first item on the agenda is to choose the
deputy convener of the committee, who must be drawn from the SNP. Is there
a nomination for the post of deputy convener?

Brian Adam (North-East Scotland) (SNP): I nominate Sandra White.

The Convener: Sandra White has been nominated as deputy convener. Do we
agree to that nomination?

Members indicated agreement.

Ms Sandra White was chosen as deputy convener.

The Convener: I welcome Sandra White to the post and look forward to
working with her.

Ms Sandra White (Glasgow) (SNP): I am looking forward to the post of deputy
convener. I am sure that we can all work together to push through the
Housing (Scotland) Bill and the wider agenda of the committee. I thank
committee members for supporting my nomination.

Items in Private

The Convener: We move to agenda item 2. Are we agreed that items 4, 6 and 7
should be taken in private?

Ms White: Why do we have to take item 7 in private?

The Convener: It is a draft report on a petition, so it is available only
to committee members until we agree it, when it can go into the public
domain. We must discuss the contents of the report in private.

Ms White: If a petition comes before the committee and we agree to discuss
the issue in private until such time as we say that it is not to be kept
private, that means that it will always be discussed in private.

The Convener: When we write a report, the discussion of its contents must
be in private.

Ms White: When the petition came to the committee, if we had not agreed to
hear it in private, it would have been dealt with in public.

The Convener: It is one thing to discuss in public how we want to deal with
a petition or any other matter, but once we decide that we will produce a
report, we must be able to deliberate on it in private. The draft paper
remains private to the committee members who must sign up to the report.
That discussion must be in private. The matter comes back into the public
domain when the report is produced.

Ms White: I understand that. I just wonder why those discussions are always
in private.

Cathie Craigie (Cumbernauld and Kilsyth) (Lab): For the record, when the
petition came to the committee we took evidence on it in public. I say that
in case anyone reading the Official Report thinks that we have always dealt
with the petition behind closed doors.

The Convener: The issue is not the content of the report, but the mechanism
by which the committee comes to conclusions on it. The practice is that
when a committee is preparing a report in the name of the committee, the
draft report is dealt with in private.

Item 3 also relates to items in private. I ask members to agree that
consideration of questions for witnesses and of the conclusions following
the taking of evidence at the sessions on 24 and 31 January and 7 and 14
February be taken in private. Is that agreed?

Members indicated agreement.

10:04

Meeting continued in private.

10:17

Meeting resumed in public.

Housing (Scotland) Bill: Stage 1

The Convener: I welcome visitors and Michael McMahon who, I understand, is
the reporter from the Local Government Committee, which is also taking
important evidence on the Housing (Scotland) Bill.

I welcome the representatives from the Scottish Executive. I will introduce
you and then hand over to you. We will have the opportunity to hear you
give a brief overview and then we will ask questions. We have scheduled an
hour for this session. I am anxious that the committee should have the
opportunity to ask questions as well as to hear your presentation, so I
hope that we can get the balance right.

I welcome Richard Grant, who is head of housing division 2, Tim Ellis, from
the bill team, Geoff Huggins, who is head of housing division 3, Murray
Sinclair from the solicitors division, Beverly Francis from housing
division 2 and Douglas Blair from the homelessness team. The range of
expertise gives a clear indication of the amount of work that must have
gone into the bill. Dealing with it is a massive undertaking for the
Executive and for this committee.

Richard Grant (Scottish Executive Development Department): We are happy to
answer questions on the objectives of the bill and on how it will work.

If members have had a chance to read the bill, they will have seen that the
long title says that it is

"An Act of the Scottish Parliament to make provision about housing,
including provision about homelessness and the allocation of housing
accommodation by social landlords, the tenants of social landlords, the
regulation of social landlords, Scottish Homes, the strategic housing
functions of local authorities and grants for improvement and repairs".

The overall purpose of the bill is primarily to provide a better deal for
tenants of social landlords and to provide a framework that allows, more
generally, for the achievement of better housing. The bill will work
primarily through amendments to the Housing (Scotland) Act 1987, which is
the primary consolidated act relating to housing. There are also extensive
changes to the Housing Associations Act 1985 and the Housing (Scotland) Act
1988.

Members may also have seen the documents that accompany the bill. There is
a policy memorandum and an explanatory memorandum, which goes through each
of the provisions of the bill. We have also circulated to the clerk
versions of the 1987 act, which have been amended to take account of the
changes that the bill will introduce. Some of the sections of the bill are
quite difficult to understand on their own, so I hope that that will be of
use to the committee. There is also a summary of the consultation that was
undertaken on the bill.

The bill has seven parts, nine schedules and 101 sections. I will go over
the main points briefly, then hand over to members for questions.

Part 1 deals with homelessness and allocations and takes forward the
recommendations of the homelessness task force. It places new duties on
local authorities to produce homelessness strategies, to secure advice for
homeless people and to provide permanent accommodation for unintentionally
homeless persons in priority need. It also creates arrangements whereby
local authorities can ask registered social landlords for assistance in
providing accommodation for the homeless and provides for arbitration if
there are disputes about that. It also includes provisions on waiting lists
and allocations.

Part 2 is lengthy. It creates the new Scottish secure tenancy for tenants
of local authorities and registered social landlords. It contains many
provisions, some of which come from the existing provisions for secure
tenancies. The basis of the new tenancy is the secure tenancy, which is
currently available to public sector landlords, but there are changes and
modifications to it. The new provisions give new rights, including rights
of succession and to exchanges and information, which are set out in a fair
number of sections and in three or four schedules. Linked to the tenancy is
a short Scottish secure tenancy. That is a new arrangement, which is meant
for specific circumstances set out in schedule 6.

The bill also makes provision for the right to buy, which has been widely
discussed. It sets out the arrangements for the modernised right to
buy—with new discounts and qualifying periods—which will apply to new
tenants in the future. It also sets out arrangements for amending and
introducing new exemptions and suspensions, including a suspension in
designated pressured areas.

The final part of part 2 deals with tenant participation. It introduces
provisions that require landlords to have strategies for tenant
participation and to review funding arrangements for tenant participation.
The provisions put duties on landlords to consult registered tenant groups
and other tenants on a range of matters.

Part 3 deals with the regulation of social landlords and local authorities
and provides for the single regulatory framework, which is one of the
objectives of the bill. It creates for the first time the concept of
registered social landlords in Scotland, and has many detailed technical
provisions, with slightly separate arrangements for regulating local
authority housing management functions from those for regulating social
landlords, housing associations and so on. It implements the decision to
regulate the homelessness functions of local authorities and local
authorities' and RSLs' factoring arrangements.

Part 4, which is relatively short, provides for the dissolution of Scottish
Homes. Part 5 deals with the strategic role of local authorities and puts
duties on local authorities to produce local housing strategies. It also
deals with a range of funding provisions relating to the payment of grants
by Scottish ministers for housing purposes and housing support services,
and with powers for local authorities to make payments to third parties. It
provides the legislative framework for a greater emphasis on the strategic
role.

Part 6 deals mainly with improvement and repair grants and extends the
range of work that can be funded through grants. It allows for the concept
of a minimum grant and introduces a test of resources for grant
applications.

Those are the main provisions of the bill.

The Convener: Do any of your colleagues want to add anything?

Richard Grant: No. They will come in when we are asked questions.

The Convener: Thank you. We move to questions. I will start the ball
rolling.

The policy memorandum states:

"The core objective of the Bill is to secure a better deal for tenants in
the socially rented sector."

Does the Executive intend to secure such improvements for tenants in the
private rented sector? Is there a time scale for improving private tenants'
rights?

Richard Grant: There are no provisions in the bill relating to tenants in
the private rented sector. Ministers have announced the establishment of a
housing improvement task force to consider quality issues in the private
sector. It may want to consider certain tenancy matters that relate to
quality issues. However, as the task force has not yet been established,
the precise details of its remit have not been decided.

The Convener: So it does not have a time scale.

Geoff Huggins (Scottish Executive Development Department): We are doing
further scoping work on the overall remit, based on what we know about
housing quality. We hope to make an announcement by the end of February,
setting out the membership and details of how the task force will operate.
However, we did not want to rush in without further thought.

The Convener: Will you be able to announce when the end stage will be?

Geoff Huggins: Yes. We intend to indicate how the task force will work,
when it should report and what outcomes we expect from it.

The Convener: Thank you.

The policy memorandum states that the bill will

"ensure that a range of decent housing options is available to all,
regardless of social, cultural or ethnic background."

How will the bill achieve improvements in housing for all sections of
society? How was the bill equality-proofed to ensure that it reflects the
needs of the disparate groups in society?

Richard Grant: I will make a couple of quick comments on that before Tim
Ellis expands on it.

Essentially, we see the bill as providing a framework within which we can
better secure equality of opportunity. The main parts of that framework are
the provisions relating to the Scottish secure tenancy, those relating to
regulation—which are closely related to the quality of service
provided—and those relating to local housing strategies and the role that
local authorities will undertake.

Tim Ellis (Scottish Executive Development Department): There is a summary
of the effects on equal opportunities at the back of the policy memorandum.
Once we had received all the responses to the consultation document, we
reviewed them specifically from an equal opportunities angle. We also had
the responses audited externally to try to take on board as many of them as
we could. We went through various processes during the consultation to
consult bodies with particular interests in equality issues, so I hope that
we have taken on board those views wherever possible.

In some cases the issues are not straightforward. In such cases, we have
had to try to strike a balance between the needs of different groups; for
example, in relation to special needs accommodation and to the right to
buy, where there are arguments from different perspectives.

10:30

Geoff Huggins: It is important to say that we continue to work with
equality groups on how the bill will be implemented and on the guidance
that will be offered. With a framework such as this, what is important is
how it is used to promote equality and housing solutions for a diverse
group of people in Scotland. This afternoon, we are meeting the three
principal statutory groups to discuss those issues further and to discuss
further how, in their view, the bill is progressing.

Brian Adam: What improvements does the bill provide for tenants whose local
authority does not pursue housing stock transfer?

Richard Grant: The bill complements the Executive's policy on community
ownership, but many—if not most—of the changes in the bill would have
benefits irrespective of whether a particular local authority proceeded
with community ownership. The provisions in relation to the Scottish secure
tenancy, for instance, will create a consistent set of rights for all
tenants of local authorities and registered social landlords. There have
been strong arguments for some time that that has value in its own right.

Similarly, we hope that, over time, the provisions relating to the
regulation of local authorities and registered social landlords will be of
substantial benefit to tenants. More generally, the provisions on
homelessness will be of wide-ranging benefit. As I said, some bits of the
bill are complementary to the Executive's community ownership initiative,
but almost all the provisions would stand in their own right. Only one or
two of them are closely tied to the community ownership initiative.

Brian Adam: The Housing (Scotland) Act 1987 introduced the right for secure
tenants to choose their landlord; the bill removes that right—not that
anybody ever had the right to choose to go back to a local authority. Will
you explain why? Is that consistent with the core objective of securing a
better deal for tenants in the socially rented sector?

Richard Grant: To correct a misunderstanding, we have not taken away the
existing provisions relating to tenants' choice—those still stand. The
existing legislation allows tenants' choice for tenants of public sector
landlords who are defined in the relevant act. We have not extended
tenants' choice to tenants of registered social landlords who were not
included in the original framework. It is the status quo, as far as
tenants' choice is concerned.

Brian Adam: How will the bill help to alleviate fuel poverty and how do the
provisions relate to other fuel poverty initiatives?

Geoff Huggins: When the bill was introduced, the minister said that she was
considering other elements, which might be included in the bill at a later
stage. Since then, we have been examining how we might incorporate measures
on fuel poverty. We followed the progress through the Westminster
Parliament of the Warm Homes and Energy Conservation Act 2000, which was
passed in November. It was too late for that act to be included in the
Housing (Scotland) Bill when it was drafted, but we understand that the
minister intends to introduce amendments at stage 2 to address fuel poverty
directly. In addition, we expect fuel poverty to be addressed through local
authority housing strategies and through the changes that will be made to
the improvement and repair grant systems to allow energy efficiency
improvements to be included in those schemes.

Cathie Craigie: Housing stock transfer will obviously lead to major
investment in houses. I thought that the Executive would have taken the
opportunity to improve on energy efficiency levels in homes as well as on
housing standards generally. Are there any plans to do that?

Geoff Huggins: Are you talking about fuel poverty issues in the context of
stock transfer authorities?

Cathie Craigie: Yes. Stock transfer is an opportunity to bring housing up
to a modern-day standard. The Executive could lead the way by setting
minimum standards.

Geoff Huggins: The Executive certainly expects, as a result of stock
transfer, that every tenant who does not have central heating will get it,
together with the insulation to make it effective. The minister has made it
clear that, should stock transfer not go ahead, resources will be found to
ensure that central heating is made available to all tenants who currently
do not have it.

Cathie Craigie: Funding for repair and improvement grants comes from local
authorities and was previously ring-fenced. However, that ring fencing was
removed following consultation and agreement between local authorities and
the then Scottish Office. There is some evidence to suggest that the amount
of money available for repair and improvement grants has been reducing. Do
you think that sufficient funds are going into the scheme? Will there be
another opportunity to consider whether the money should be ring-fenced?

Geoff Huggins: Since the ring fence was removed in 1995, the amount
invested by local authorities in improvements and repairs has reduced.
However, the bill gives us an opportunity to encourage local authorities,
through strategic planning, to identify the priorities in each area and to
use the appropriate share of the overall funding. We expect local
authorities to take a strategic approach. It would be quite odd for us to
go back and intervene to ring-fence that pot of money. However, we are
always prepared to listen to arguments about that.

Cathie Craigie: What would happen if ministers felt that local authorities
were not targeting enough money on those areas of the budget?

Geoff Huggins: The process of strategic planning allows ministers to
identify priorities against which local authorities can plan and set their
objectives. That will create expectations. Ultimately, the investment that
ministers make available to local authorities will be dependent on the
degree to which local authorities act in accordance with Scotland's
priorities. That is where persuasion may come into it.

Richard Grant: At the moment, resources for improvement grants are included
in the capital consents given to local authorities under local government
legislation. Local authorities can choose whether to spend money on housing
or on education, for example. That is the position that was reached in
1996. The bill creates a framework that would allow Scottish ministers to
pay grants for housing purposes, which are broadly defined, to local
authorities. That provision is intended to be used primarily to allow
resources that currently go to Scottish Homes to be transferred to local
authorities, with a shift in responsibility for development funding. Those
resources could be used for any purpose, but the money for improvement
grants is currently channelled through those capital consent mechanisms.
Should ministers wish at any time to reintroduce a ring fence, there is a
legislative mechanism that could allow for that, but the current policy is
not to ring-fence money for improvement grants.

Brian Adam: Can you give us an assurance that, as part of the current
review of housing standards, the energy rating and the criteria for
below-tolerable-standard housing will be addressed?

Geoff Huggins: It is for ministers to give assurances, but I can say that
the review will take account of those issues. In December, we announced
changes to the tolerable standard, which are included in the bill. We also
announced that there would be a consultation on the index of housing
quality. That will not dilute the tolerable standard, but it will recognise
that there is a category of housing that is so poor that we must act on
those houses as soon as possible. A new category will be introduced for
poor property that may have energy efficiency or security problems but
which is not so bad as to fail to meet the standard.

Over time, we would expect local authorities to take action to identify
that second category, rather than putting both groups of houses into the
same below-tolerable-standard category. That is a better way of targeting
resources over time, because there are things that we must do and other
things that we want to do. The working group will consider all those
issues.

Brian Adam: Should not there be an improvement across the board,
particularly in terms of energy rating, for houses that are below tolerable
standards and those that are on the borderline?

Geoff Huggins: Our aim is to improve the housing stock throughout
Scotland.

Ms White: I want to ask about the bill's provisions on homelessness. Will
local authorities receive adequate finance to carry out the additional
functions to ensure that homelessness eventually disappears from Scotland?

Douglas Blair (Scottish Executive Development Department): Just before
Christmas, Jackie Baillie announced that the Housing (Scotland) Bill's
provisions on homelessness will be backed up with £27 million over three
years. We feel that that sum is sufficient to back up the additional duties
that are being placed on local authorities, particularly for securing
advice and providing temporary accommodation for young priority applicants
for the first time.

Ms White: Is the bill strong enough to cover the requirement on registered
social landlords to take in homeless people if local authorities ask them
to?

Douglas Blair: The homelessness task force considered that in detail before
producing its report last year. The task force was clear that there should
be contractual arrangements and day-to-day co-operation between local
authorities and RSLs. The purpose of the bill is to give that some
statutory backing, and the task force thinks that the requirement on RSLs
to comply with a local authority request is enough to back up what should
be happening on the ground in any case.

Ms White: The development funding function of the executive agency will
reduce as the administration of the development funding is transferred to
local authorities. Will the change in administration lead to an increase or
decrease in the amount of money that is provided for development funding by
the Executive?

Richard Grant: Do you mean money that is provided to the private sector?

Ms White: No.

Geoff Huggins: The funding that is being referred to is that which is
allocated through Scottish Homes. Ministers will, in line with their
priorities, make yearly decisions on the level of funding that is to be
made available for the development of housing stock throughout Scotland.
That is compatible with either increases or decreases in the amount of
money that is made available—there is simply a different mechanism.

10:45

Ms White: So you cannot say that there will definitely be more moneys?

Geoff Huggins: It is—again—not for us to provide assurances on that.

Ms White: You cannot provide assurances that more moneys will be provided?

Geoff Huggins: No. That is a matter for the Minister for Finance and Local
Government and the rest of the Cabinet.

The Convener: In response to previous questions, you have already indicated
some areas that are your responsibility and others are the responsibility
of ministers. We have taken note of that, and we will seek assurance from
ministers on questions that the witnesses have not been in a position to
answer.

Ms White: I was merely clarifying the point.

The Convener: It is not an issue for the officials; it is an issue for the
committee to deal with.

Richard Grant: Primarily, the bill would change the mechanisms by which
development funding may be paid out to development agencies. At the moment,
the money is allocated through Scottish Homes. In future, it could be paid
by the Scottish ministers through the executive agency. It could also be
paid by local authorities. Most of the Scottish Homes' powers relating to
development funding are to be transferred to the Scottish ministers. We
have also sought to provide those powers to local authorities. Under the
new powers, there would be nothing concerning the funds that go through
Scottish Homes now that local authorities would not be able to deal with.

Ms White: That brings me neatly to a further question on Scottish Homes.
Perhaps you—or, if we do not get the proper answers, the minister—can
explain the following. On 1 November 2000, the Minister for Social
Justice—then the minister elect—told the Social Inclusion, Housing and
the Voluntary Sector Committee that Scottish Homes' outstanding debt would
be around £100 million when it was wound up. To whom is that debt due? How
did it accrue? When is it due to be repaid? Will the winding-up of Scottish
Homes have any effect on the repayment on the debt? What impact will there
be on the housing budget?

Geoff Huggins: The debt came to Scottish Homes along with the assets that
it received in 1989, when it was set up. It was accrued by the Housing
Corporation in Scotland and the Scottish Special Housing Association. The
debt is owed by Scottish Homes to the Scottish ministers, who in turn owe
it to the Secretary of State for Scotland, who in turn owes it to the
national loans fund and another loans fund.

I understand that some of the debts are 60 years old. At the point when
Scottish Homes no longer exists, we expect that the Scottish Executive will
still owe the money to the Secretary of State for Scotland, who will still
owe it to the national loans fund. At the moment, we have arrangements in
place that allow us to pay money to Scottish Homes yearly, which allows it
to meet its obligation to us yearly. We pay that to the Secretary of State
for Scotland, who then pays it to the national loans fund. That payment is
currently met from provision that we make to Scottish Homes. The provision
is already in the line, and there is no reason why it cannot continue to be
met yearly by us—the Scottish Executive—and paid directly to the
secretary of state, to allow for the discharge of the debts over time.

We would expect the winding-up of Scottish Homes to have no effect on the
development programme.

Ms White: So, basically, the debt will be transferred.

Geoff Huggins: It will not be transferred—we already have the debt. We
just gave the debt to Scottish Homes, which has to pay us back.

Ms White: If Scottish Homes no longer exists, the new arm will have to pay
you back in the same way.

Geoff Huggins: Ultimately, we have to pay the Secretary of State for
Scotland for the debt, and we will still have to do so. Nothing really
changes.

Ms White: That is what I was saying. The debt transfers to the Scottish
Executive, and you are already paying it, but through Scottish
Homes—which will no longer exist.

Geoff Huggins: Effectively, yes.

Ms White: I am glad we got to the end of that one at last.

The Convener: I reiterate that it is not a question of us being unable to
"get the proper answers" from the Scottish Executive officials to some of
our questions. They have authority to answer on some matters. If, however,
they are unable to answer questions because they do not fall within their
remit, we are noting that and will pursue those questions with the
minister. We understand the constraints upon the officials.

Robert Brown (Glasgow) (LD): I am bound to say that, after his explanation
about the Scottish Homes debt, Mr Huggins has a great bureaucratic future.
[Laughter.]

I wish to make some points about commencement times and so on. The secure
tenancy is being replaced by the Scottish secure tenancy. Is there a gap?
It appears that the order to instigate the new tenancy would be made at a
later date, but that the existing secure tenancy would be repealed straight
away.

Richard Grant: There is no intention for there to be a gap. Section 101
would allow for the commencement of the act as a whole. Once it was
commenced, we would introduce orders under section 9 to allow for the
introduction of the Scottish secure tenancy. Given the way that the
order-making powers are drafted, we could bring in the Scottish secure
tenancy for all new tenants and existing tenants at the same time.
Alternatively, we could stagger its application to existing tenants. That
would mean that it was introduced in different areas and for different
individual landlords at different times. The drafting is very flexible in
that regard.

Our current preference is for all tenants to move on to Scottish secure
tenancies at the same time, if possible. It will take some time to prepare
for that, and we need further discussions with local authorities and with
the Scottish Federation of Housing Associations on that. It might be
desirable to introduce the tenancy in some local authorities before we do
so in others.

Robert Brown: I take it, then, that it is not a matter of the existing
secure tenancy ending as a result of one of the schedules, or because of
the bill being passed before the relevant order is made.

Richard Grant: That is certainly not our intention. I invite Murray
Sinclair to comment further on that.

Murray Sinclair (Scottish Executive Development Department): There is not
much that I can add, other than to underline Richard Grant's point that we
have very flexible powers for commencement of the bill's provisions. They
are flexible not only in the way that Richard indicated. They would allow
different provisions for different purposes to be commenced on different
days and, accordingly, for different areas and different types of landlord.
They also carry extensive powers to make what are known in the trade as
transitional and savings provisions, which are expedient for a proper
bridge to be built between the existing law and the law as it will stand
after the bill is passed. That should be sufficient to ensure that an
appropriate staggered commencement can be achieved.

Robert Brown: A few Scottish Homes tenants remain. They seem not to come
under the new Scottish secure tenancy. What will their status be?

Richard Grant: They will remain secure tenants. We gave some thought to
what we should do about Scottish Homes tenants. Given that ministers'
policy is to seek to transfer ownership of the remaining Scottish Homes
stock, it did not seem to be a good idea to go to the trouble of changing
all existing Scottish Homes tenancies from secure tenancies to Scottish
secure tenancies before the transfers.

In any event, the bulk of transfers may take place before the bill's
provisions are commenced—we are not sure about that at the moment. Our
current intention is that stock that is owned by Scottish Homes at the
point just prior to that organisation's being dissolved would transfer to
some form of residual body, which we might need to tidy up Scottish Homes'
procedures. As I said, the tenants concerned would retain secure
tenancies.

Robert Brown: Section 9(2) allows ministers to

"make provision for ensuring that rights of the landlord, the tenant and
any other person . . . are not adversely affected by the tenancy becoming a
Scottish secure tenancy."

To whom does that apply? Who are the other people who might require
protection, and why do they need it? It seems to be rather an unusual
subsection.

Richard Grant: That encompasses some of the flexibility that Murray
Sinclair mentioned. It is ministers' policy to keep the existing
right-to-buy provisions for existing tenants. Other provisions apply to
particular types of tenancy.

For example, housing association tenants with tenancies dating back to the
1980s are entitled to fair rents that are set by a rent officer. That
provision is not general, and other rents that are set by housing
associations and local authorities are not affected by it. However, we
would like to continue those tenants' entitlement to apply to a rent
officer to have their rent fixed.

The other issue that I should mention concerns heritable creditors. Under
the provisions relating to assured tenancies in the Housing (Scotland) Act
1988, heritable creditors have certain rights if a person to whom they have
lent money becomes insolvent. We have deliberately not included those
rights in the new tenancy, but we have conducted discussions about them
with the Council of Mortgage Lenders. There are cases in which those rights
are relevant, and we might want to protect them by using that mechanism.

Robert Brown: I have a couple of questions on the right to buy. Two
separate systems of the right to buy are proposed; the existing one and a
new one under the proposed Scottish secure tenancy. Does that undermine the
objective of achieving a single social tenancy? What is the reason for
proceeding in that way, rather than moving all tenants on to a new system?

Beverly Francis (Scottish Executive Development Department): Ministers had
to make decisions about that. In taking a view, their concern was to ensure
that existing tenants' rights were not diminished in any way, especially in
relation to the right to buy. Tenants accrue eligibility for the right to
buy and associated discounts. In taking up their tenancies, they had a
reasonable expectation that they would be able to exercise that right on
certain terms. The ministers' preference, in policy terms, was to retain
those rights. Therefore, only new tenants would take on the modernised
right to buy. Over time, as houses are re-let, uniformity will be achieved
across the sector.

Robert Brown: I have a final question on pressured areas. Under section 39,
there is provision for local authorities to apply for exemptions under the
various arrangements. I worry that, in some areas, there might be a gap
between the introduction of the new right to buy and the implementation of
an exemption—that there will be a sort of leakage from the system in
situations in which there ought not to be. Do you share that fear? If so,
how can it be countered?

Richard Grant: The intention is that the pressured area would affect new
tenancies, not existing ones. In a working group—which I chaired and
which was set up by the minister in the summer—with other interested
parties, we have considered in detail the possible procedures for
designating pressured areas. I would be happy to send a copy of that
group's report to the clerk, if the committee is interested in reading it.

We discussed whether the designation of pressured areas should be linked
into what were then called single housing plans—now called local housing
strategies—as was originally suggested in the consultation paper. Several
bodies put it to us that it would take time for those documents to be in
place and that, therefore, there would be a gap. As a result, we agreed
that there would be a separate procedure for designating pressured areas
and that local authorities would need the relevant supporting evidence,
which they may already have to hand in the form of their or Scottish
Homes's existing planning documents. I hope that local authorities that
want to designate areas will be able to make cases soon after the bill is
enacted. They could think about doing so now.

Brian Adam: The intention is to designate pressured areas geographically.
However, to attain a balance in the housing stock, has consideration been
given to basing exemptions on house type or size? For instance, there are
few large houses for large families in the housing stock.

11:00

Richard Grant: We have given that some thought. In the bill as it is
drafted, pressured areas are primarily geographical areas. If a whole area
is designated, house types in that area that are especially in demand will
also be caught by the designation. It is difficult to imagine how objective
tests of need could be carried out in the designation of specific types of
housing that are slightly more popular, in areas in which there is a
general surplus of housing. The bill already provides for exemptions for
some types of property—for example, grouped houses and houses in which
there have been significant adaptations for persons of pensionable age.

If there were a general surplus of houses, it would be possible to convert
some properties into larger or smaller houses. At the moment, the emphasis
is on pressured areas rather than specific types and sizes of house. When
we discussed the matter in the working group that I mentioned, members of
the group thought that there would initially be some difficulty in
procuring the necessary evidence to support a designation of the sort that
you describe, but that, in due course, that might be a sensible solution.

Ms White: Do you think that there will be any problems with the European
convention on human rights, regarding the policy of designating areas for
five or 10 years? Will people appeal to the European Court of Human
Rights?

Richard Grant: The short answer is no. I ask Murray Sinclair to expand on
that.

Murray Sinclair: We hope that there will be no such appeals. We take great
care in putting together legislative proposals, to ensure that they do not
infringe on the ECHR. The proposals in the bill, as it is drafted, would
not do so. We have received reports of suggestions to the contrary, based
on a Greek case involving someone called Larkos, but we do not regard that
case as directly relevant. It concerned discrimination that was based on
the man's status as a civil servant and involved an infringement on his
right to respect for his home—he was evicted.

No one will be evicted as a result of our proposals for the right to buy;
we are concerned with conferring rights, not with taking rights away.
Furthermore, we are not discriminatory in our view. Although some people
have different rights to buy, those differences apply by reference to the
time at which the right is required, not by reference to any status. They
will apply to all tenants who acquire such rights, regardless of their
status. In any event, any differential treatment can be justified on an
objective, reasonable basis. There is ample convention case law to
demonstrate that, even when an infringement of rights has been based on
discrimination, the ECHR will not have been contravened if there is
objective and reasonable justification in policy terms. Beverly Francis has
suggested that that will be so in the situation that has been described.

Karen Whitefield (Airdrie and Shotts) (Lab): I have a final question on
pressured areas. Some housing associations have suggested that the system
that would be introduced would be so burdensome and bureaucratic that local
authorities would be reluctant to apply for pressured area status. It has
also been suggested that local authorities would come under a great deal of
political pressure from people who live in those areas and who want to
exercise their right to buy, and that such pressure would be greater than
that from people who are on waiting lists. Local authorities would, for
that reason, be reluctant to apply for pressured area status. Has your
working group considered those points and what measures will it take to
ensure that the process is simple?

Richard Grant: The working group considered the first of those points very
carefully. Although we have not yet produced detailed guidance for local
authorities on the material that they will have to produce, we have agreed
a list of broad considerations and possible indicators. That work will need
to be refined further. We were particularly conscious of that issue.
However a balance needs to be struck between ensuring—before taking away
rights of tenants—that there is good and proper justification and making
it so difficult that local authorities would have to do so much work that
it would never happen. I think that the working group found the right
compromise between the two positions. I will circulate the paper and
members will be able to judge that for themselves.

It would be a matter for local authorities to judge whether they wished to
apply for a designation. The bill would require them to consult. The
working group considered in more detail what the procedures should be and
suggested that there should be consultation with RSLs and other relevant
interests in an area. At the end of the day, the local authority, in taking
a view on the housing needs in its area, must decide whether to ask for a
designation.

Karen Whitefield: Can you explain how you balanced the right of individual
tenants to participate in decisions that are taken by their landlord with
the rights that are being given to strengthen the operation of tenant
organisations?

Richard Grant: Do you mean the balance between individual rights and those
of housing associations?

Karen Whitefield: Yes.

Beverly Francis: As members might be aware, the Tenants' Information
Service was commissioned by the national tenant participation working group
to undertake a feasibility study into the statutory right to tenant
participation. One of the crucial points that came out of that study was
that it is difficult in practical terms to give an individual right to
participate. It was suggested that, to make the right to participate
meaningful, it had to be collective. The bill would introduce significant
rights to information and consultation for both individuals and collective
tenant groups. It would also place a duty on landlords to recognise what we
are calling registered tenant organisations. Those organisations would have
a right to participate and to be consulted collectively about decisions
that a landlord was taking that would affect them. We do not see that as
being a one-or-the-other situation. We want to create a framework that will
allow individual tenants who choose to become involved in the
decision-making process to participate as well as those who want to become
more active through some form of collective vehicle.

Karen Whitefield: My final question is about the regulation of social
landlords. Following an inspector's investigation into the affairs of a
registered social landlord, Scottish ministers may choose to leave things
as they are or to appoint a manager to conduct the affairs of a landlord.
Did you consider giving ministers other options, such as requiring a
landlord to produce a remedial plan, as afforded to local authorities? If
not, why not?

Tim Ellis: The provisions seek to build on the current provisions for RSLs
and the general process. The difference between provision for local
authorities and that for RSLs reflects the fact that we recognise that
local authorities have very different democratic responsibilities and may
therefore need to have alternative approaches. The bill tries to establish
one regulatory framework, but not one regulatory system; it recognises that
there are differences between different types and sizes of landlord.

Remedial plans would be another option. To date, we have not considered
that to be the most appropriate approach. However, as always, we will
listen to views on that.

The Convener: I would like to ask about the responsibilities of registered
social landlords. There is an issue in relation to homelessness. In some
cases there may be no local authority housing, but instead an agreement
between the local authority and RSLs to take on tenants who are defined as
homeless. Where there is no agreement, it has been decided that an arbiter
should be put in place. Rather than saying that the minister is allowed to
establish a timetable for that, should not the bill have identified a
reasonable amount of time for that process to be completed?

Douglas Blair: In case of disagreement between the local authority and the
RSL, the provisions in the bill would allow Scottish ministers to set a
period in which the parties would need to agree amongst themselves before
they go to arbitration. That would be left to secondary legislation, which
would to allow flexibility in the time scale. Arbitration is meant to be a
quick process. We were keen not to put a lot of detail in the legislation
about the way in which the arbiter would be appointed and whether local
authorities and RSLs would have an agreed list and so on. We want to leave
that to the guidance so that it does not become a bureaucratic and lengthy
process. Key stages of arbitration are included for the quick resolution of
disputes and that is backed up by guidance on the way in which local
authorities and RSLs may wish to proceed. We did not want to make people
jump through hoops before a dispute could be resolved.

Bill Aitken (Glasgow) (Con): I would like to explore the relationship with
local authorities. The bill is silent on the criteria that will be applied
by ministers in the award to any local authority of a strategic housing
budget. As far as I can see, there is no reference to any guidance—it
seems that things will be done on a nod and a wink. Should there be
guidance?

Richard Grant: Bill Aitken is right to say that that is not set out in the
bill. "Better Homes for Scotland's Communities" set out the broad criteria
that would be used and those remain the essential criteria. The intention
is that ministers will consider allocating funding in cases where local
authorities have transferred their stock and have demonstrated that they
are able to produce local housing strategies and have the ability to
undertake the development funding. That is the only safe route that was
identified.

In addition, there might be circumstances in which that is not taking
place, where there is agreement locally that the transfer should go ahead
and the local authority has the necessary skills and ability both to
deliver the housing strategy and to manage the programme.

Geoff Huggins: We have been working with Scottish Homes and the Convention
of Scottish Local Authorities to determine the detail of the checks and
balances so that all parties are clear at the outset. The system must be
transparent, so that housing associations and others can see how it would
work in practice and are satisfied that it would also protect their
interests. It is important that we get that work right, but it needs a
degree of flexibility that might not sit so well in legislation.

Bill Aitken: Will you issue a guidance note at some stage?

Geoff Huggins: Yes, we will.

Bill Aitken: Local authorities are required to submit their strategic
housing plans to Scottish ministers. One might question why that is
necessary when the bill includes no procedure for ministers to scrutinise
and comment on those plans.

Richard Grant: The intention is that the Scottish Executive would
scrutinise plans and comment on them. We do not have a procedure, as such,
for the formal approval of the plans, but the bill envisages that the plans
would be submitted to Scottish ministers and that they would take account
of the plans in allocating resources to local authorities under the other
provisions.

Bill Aitken: What would be the mechanics of that? Without a legislative
framework, it could be a recipe for conflict.

Richard Grant: I need to check the bill, but I think it would establish
requirements for the submission of local housing strategies. The mechanics
are that we would expect the executive agency to play an important role in
that. It would work closely with the local authority and receive the
housing strategy on behalf of the Scottish ministers. It would then assess
the strategy and it might send views back to the local authority, revise
the strategy and give the Scottish ministers views on the strategy's
implications.

11:15

Geoff Huggins: The planning process is part of a dialogue between central
and local government. The process of receiving plans allows the Executive
to find out what local housing priorities are, through the additional
information that is made available and the requirement to have an
understanding of local housing conditions and to be better informed in
making policy. A key dialogue will take place, which perhaps does not
happen as it should at the moment. Local authorities make it clear that
they want more feedback from the Executive on their housing plans. They
consider that to have the potential to be positive and to allow better
working and understanding of one another.

The Convener: We spoke about Scottish Homes and its complicated money
situation. Why was it considered necessary to create a new agency instead
of reforming Scottish Homes?

Geoff Huggins: The key change is the transfer of the key functions of
Scottish Homes, which is a non-departmental public body that is accountable
under statute, to the Scottish ministers. Henceforth, the Scottish
ministers will be accountable to the Parliament for registering and
regulating social landlords and local authorities. The Scottish ministers
will be accountable to the Parliament for the distribution of development
funding, whether through Scottish Homes or local authorities. That is a key
accountability issue.

The Executive would expect many of those functions normally to be carried
out by an agency, but the agency would be part of the Scottish Executive
and not an external office. It would be the direct responsibility of
ministers. Under current structures, that is the appropriate
relationship—to allow ministers to be accountable to the committee and
the Parliament as a whole.

Cathie Craigie: I will focus further on the right to buy and the amendments
to the scheme. Most people who work in the field and in the administration
of the right to buy welcome some of the changes. Legislation requires local
authority landlords to notify their tenants annually of the right to buy.
Would it be fair to notify tenants who are considering exercising their
right to buy that they have responsibilities as well as rights? When people
take on a property such as a flat in a block that contains four flats, they
have a responsibility to become involved in common repairs. Despite the
maximisation of grants, there are difficulties with involving owners. Is
there now an opportunity to try to modernise the legislation to take
account of experience?

Richard Grant: You are right that there are two sides to the issue. When
tenants buy, they take on responsibilities. We have tried to ensure that
local authorities make that clear to purchasers.

Beverly Francis: The bill will make extensive changes to the current
arrangements for information on the right to buy. As Cathie Craigie said,
current legislation provides that landlords must tell tenants about the
right to buy annually. The bill introduces an additional obligation on
landlords, to provide information to tenants before they take on a tenancy
about whether the right to buy applies to the property.

One concern about the extent of exemptions and suspensions in the
modernised right to buy is that tenants must receive better information
about the right to buy and how it might be exercised. More extensive
information will have to be provided. The provisions on the right to
information say that a tenant should be able at any time to request
information from their landlord about what the right to buy would mean for
them.

Cathie Craigie is correct about information on obligations. We want to
create a balance between individuals' rights to exercise the right to buy
and their obligations as joint owners. The Executive chairs a common
repairs working group, which ministers established some time ago following
the publication of the Scottish Consumer Council report "In A Fix", which
highlighted some of the issues that are involved. That working group has
drawn up a fairly extensive work plan of good practice and guidance to
allow us to consider best practice.

We are working on completing some leaflets for tenants who are considering
exercising the right to buy. One leaflet will be about not just the right
to buy scheme, but common repairs, factoring and what all that means for
tenants. We are trying to warn tenants in advance about some of the
implications of purchase, particularly if some form of common property is
involved. That leaflet will be followed by a further leaflet for those who
have bought property under the right to buy scheme or through the normal
housing market. That leaflet will go into some detail about the obligations
and the sources of support for difficulties.

The bill attempts to bring factoring within the regulator's remit for the
first time. That will make a significant difference, because it will ensure
that the regulator can take a view on practices in the registered social
landlord and local authority sectors. Research into that suggests that good
and bad practice exist. Some landlords offer a good factoring scheme and do
the work well; others do not work so well. We would like to create some
model good practice policies and procedures for people to adopt.

The committee will be aware of the work that colleagues elsewhere in the
Executive are doing on land tenure reform, the proposed bill on title deeds
and the law of the tenement. All those matters will have an impact on the
legal infrastructure. Any appropriate legislative work should be done with
those bills, rather than with the Housing (Scotland) Bill, because the law
is complex and it would be dangerous to take a quick run and jump at it.
The common repairs working group will be heavily involved in examining the
consultation documents that are produced for those future pieces of
legislation, to ensure that social landlords and housing management are
fully taken into account.

The Convener: After Bill Aitken asks his question, we will finish the
questioning. I had not realised that the previous question would open up
such a big subject.

Bill Aitken: In my experience, Scottish Homes has performed its regulatory
function extremely well. Under the new relationship whereby Scottish Homes
becomes an arm of the Executive, is not there a danger that part of the
previous body's regulatory strength will be lost? To some extent, the new
body will have to comment on and measure the effectiveness or otherwise of
the Government's housing policy. At this stage, the body is not expected to
be at arm's length. Is not there a difficulty with such a body criticising
the effectiveness or operation of the Executive's housing policy?

Richard Grant: We do not think that the new regulatory part of the
executive agency will comment on Government policy. Its responsibilities
will relate to regulating the management functions and homelessness duties
of local authorities, as well as the traditional function of regulating
housing associations and other registered social landlords. We certainly
agree that Scottish Homes has a very good track record of carrying out its
regulatory function, on which we will be able to build when the regulatory
role is extended.

Bill Aitken: Could there not be a conflict of interest, given that,
inevitably, there will be occasions on which Scottish Homes, as an
executive arm, will have to comment on a failure that could be attributed
to a flaw in policy?

Richard Grant: The regulator's primary task will be to look at the
day-to-day management, although it may want to make more general points
about how functions are carried out. There is a need to keep the day-to-day
regulatory work of the executive agency at arm's length from ministers.
That is one reason why we have opted for the executive agency model rather
than bringing Scottish Homes directly into the Executive.

There is a clear commitment in the bill to having a statutory code of
guidance to which the regulator will work. Although it is not in the bill,
there is in "Better Homes for Scotland's Communities" a proposal to appoint
non-executive directors to the management body for the executive agency,
who would have a particular interest in overseeing its regulatory work.

The Convener: We may want to pursue that point further with the minister.

Brian Adam: Geoff Huggins kindly gave us an interesting explanation of how
the debt of Scottish Homes is serviced. Perhaps we could explore further
how it was accrued. Is any of that debt due to the discount that was
offered to Scottish Homes tenants who bought their properties? If so, what
proportion of the debt is due to the sale of Scottish Special Housing
Association houses?

Geoff Huggins: I understand that the debt has diminished yearly since the
creation of Scottish Homes in 1989. The debt was wholly accrued on the
construction of the properties that became the assets of Scottish Homes. As
those assets were sold, either to tenants under the right to buy or to
other housing associations, and the receipts were used to redeem part of
the debt, I cannot answer your question, but I can certainly write to you
on that.

Richard Grant: Perhaps I can explain further. Until about 1997—I am not
sure of the precise date—the receipts from right-to-buy sales by Scottish
Homes were channelled back into its programme. The decision was then taken
that all the money from right-to-buy and large-scale voluntary transfer
sales should be used to redeem debt. There was a general change of policy
on receipts, which applied also to local authorities.

The debt originates in pre-Scottish Homes days, when the Scottish Special
Housing Association borrowed money to build houses and the Housing
Corporation borrowed money to lend on to housing associations for the
construction of houses.

The Convener: I thank the witnesses for their attendance. I think that
members have found this a useful session. I also thank the witnesses for
their offer to send a report from the committee that was chaired by Mr
Grant—I am not sure what the group was called. We would welcome that
report and any other information that is relevant to today's session.

11:30

We will now take evidence from the Chartered Institute of Housing in
Scotland. We have with us Alan Ferguson, who is the director of the
institute, Gavin Corbett, who is the policy officer, and Michael Thain, who
is the parliamentary officer. I am delighted that you are here today. You
may wish to give a brief presentation before we move to questions.

Alan Ferguson (Chartered Institute of Housing in Scotland): We are
extremely pleased to be here to give evidence on the bill. A couple of us
have given evidence to the committee on a couple of issues before, but we
are happy to be back and hope that what we have to say will be of interest
to you.

The Chartered Institute of Housing is the professional body for people
working in housing. We have more than 1,600 members in Scotland, who work
in local authorities, housing associations, Scottish Homes, educational
institutions, voluntary organisations and the private sector. We even have
a member who is an MSP. The institute is concerned to encourage the
provision and management of good quality housing for all and sustainable
communities. To that end, we promote good practice through publications,
training and seminars and we try to influence policy generally.

It is fair to say that several of the institute's broader objectives are
met by the bill, such as ensuring that tenants have the same rights through
the single tenancy; improving the standard of service delivery through the
single regulator; enhancing the local authority's strategic role through
local housing strategies and development funding; and improving the rights
of homeless people. Indeed, we have worked on a number of those objectives
for a long time and will submit to the clerks some reports that will give
background information.

We believe that the bill has the capacity to change Scottish housing.
However, it cannot be taken in isolation from other issues. For example, it
will not in itself improve the quality of housing or increase investment.
The new housing partnership programme links in here. Ensuring that the bill
leads to real change will require a culture change in organisations and
staff with skills to do the job, for example in relation to local housing
strategies.

Although we agree broadly with much of the bill, I will highlight some
important issues that it does not cover. First, there are a range of
problems in the private sector, including disrepair and a lack of
investment. We hope that, rather than parachuting anything into the bill
now, the housing improvement task force, which the minister recently
announced, will consider the whole area and propose action that the
committee will consider in future. Secondly, the housing improvement task
force may have a role on fuel poverty and energy efficiency, but if any
measures are included in the bill, the committee should consider
implications such as the need for resources.

The committee should be alert to the fact that the bill is not the end of
the story. Clearly, implementation issues arise from many parts of the
bill, such as the provisions for a single tenancy. Also, much of the bill
will result in the Executive having considerable powers and being able to
act through regulation. It is important that the committee has a role in
scrutinising those powers and the minister's proposals.

Finally, I want to highlight a couple of issues that we would like the
committee to think about. The first relates the introduction of the single
tenancy. We believe, and have always argued, that the implementation of
what is now called the Scottish secure tenancy should be from one date,
when all existing secure and assured tenancies convert to the new tenancy.
The bill allows for the phased implementation of the tenancy. We are
concerned that that route will lead to further confusion about tenancy
arrangements. We would like the committee to consider the big bang approach
to implementing the tenancy.

Secondly, it is absolutely clear that the right to buy has had damaging
effects. Most housing professionals would love to do away with it, but we
do not believe that that is a realistic option. We have tried to argue that
we need to reform the right to buy, making it more strategic and reducing
discounts so as to mitigate its effects. The bill has moved in that
direction, although there is potential for further reform.

The biggest problem with the right to buy is not the right in itself, but
the existence and level of discounts. We would like the committee to
consider further reductions to the discounts. We would also like the
committee to encourage the Executive to use the powers in the bill to vary
discounts by local area, depending on local circumstances, the strategy for
the area and the need to promote home ownership or, on the other hand, to
maintain a certain level of affordable rented housing.

I thank committee members for their attention. We will be pleased to answer
any questions.

The Convener: Thank you for the written evidence that you provided for the
committee. We look forward to seeing your further reports.

You have said that you can see that it is not now possible to introduce
into the bill an element to deal with private tenants. Would it be
appropriate to identify a time scale for the Executive for addressing the
question of private tenants?

Alan Ferguson: There is a major problem concerning the private sector. Most
organisations, including the institute, have said that we need to do
something about it. A range of issues arise—such as disrepair, owners not
taking responsibility and a lack of resources.

We hope that the housing improvement task force will discuss the issues. It
is important that a time scale is set for that, that this committee is
aware of the time scale, and that the committee then considers any
information that the task force supplies. A time scale is crucial. The
sooner the task force gets started and is given a timetable, the better.

The Convener: You will have noted that the policy memorandum says that the
bill will

"ensure that a range of decent housing options is available to all,
regardless of social, cultural or ethnic background."

As it stands, can the bill do that? Can it deliver on the equality agenda?
Are you satisfied that what is in the bill can match that claim?

Alan Ferguson: A number of things in the bill are crucial to that. For
example, it is important that the regulator sets robust standards and keeps
equality in mind when considering access issues or housing management
performance standards.

In the parts of the bill that deal with single tenancies, the introduction
of the ground of harassment is an important step in the right direction and
will be beneficial. A number of organisations have raised concerns about
that issue.

Several parts of the bill will contribute to equality of opportunity, but
we cannot consider equality on its own. Access issues are important, but
access to property is not just an issue for this bill. We need to ensure
equality of access and opportunity through the bill, but we need to keep
other things in mind as well.

Brian Adam: Does the bill offer any substantive improvements for secure
local authority tenants where the authority does not pursue housing stock
transfer?

Alan Ferguson: The institute has argued for the introduction of a single
tenancy for some time and, in 1998, we produced a report called "One for
All". Although stock transfer is an important element, the crucial thing
about the single tenancy was rights. We wanted to ensure that rights were
protected across the board. For existing tenants, or for tenants of local
authorities that are not considering transfer, the bill contains improved
rights—rights to information and consultation, for example. Those rights
will apply regardless of whether a council is considering transfer.

The bill contains important rights for homeless people. The bill is not
only about stock transfer: it is about many other things and it will lead,
I think, to improved rights across the board for tenants.

Brian Adam: What is the view of the Chartered Institute of Housing in
Scotland on the possible implications of the bill for the right of secure
tenants to choose their landlord? Has an opportunity been missed, in that
tenants in the social rented sector who are not local authority tenants do
not have the right to choose the local authority as their landlord?

Michael Thain (Chartered Institute of Housing in Scotland): Tenants choice
is often perceived as the tenant's right to choose a landlord. I think that
I am right in saying that it is actually a right that qualifying landlords
have to offer themselves to tenants of councils. The tenant's right to
choose is not actually written into the statutory rights of local authority
tenants. I think that that is what the civil servants were trying to
explain earlier. The bill does not change that. Tenants choice will remain
as it is just now for council tenants.

I do not think that many of us have given a great deal of consideration to
whether tenants choice should be extended to registered social landlords or
to housing associations, or to what the implications of that may be. That
may be because we would then be dealing with much smaller landlords where
the loss of tenancies through tenants choice may have a significant impact
on viability.

Brian Adam: Will the bill help to alleviate fuel poverty? If so, how?

Alan Ferguson: As it stands, the bill in itself will not alleviate fuel
poverty. Fuel poverty and fuel inefficiency are crucial issues that must be
tackled, but I do not think that the bill contains much that will do that.
The civil servants have, I think, already spoken about whether ministers
will lodge amendments to that effect. How we tackle fuel poverty and how we
would resource that will be issues. As I said in my introduction, the
housing improvement task force may have a role to play.

The new housing partnership programme is partly about stock transfer and
partly about improving the quality of housing. A concern that the institute
has tried to raise is that, at the moment, we have not been assured that we
will get energy efficient houses at the end of the stock transfer. The new
housing partnership advisory group has touched on that issue a number of
times, but there has not as yet been any real discussion on it. A lot of
emphasis has been put on stock transfer as a means of improving housing,
but we do not know what the result will be in terms of energy efficiency
and tackling fuel poverty.

The bill does not do an awful lot about fuel poverty. We need to consider
other things, although there are still questions over whether those other
things will do anything to alleviate fuel poverty.

Brian Adam: Has the institute a particular view on how the alleviation of
fuel poverty might be achieved? Will it be possible through this bill? What
is your advice?

Gavin Corbett (Chartered Institute of Housing in Scotland): The Home Energy
Conservation Act 1995 has been around for some time now, which suggests
that legislation alone is not especially effective in tackling fuel
poverty. It has been suggested that certain things be put in the bill—for
example targets and improvements to the tolerable standard. We are worried
that if that is done in isolation from the discussion on the funding that
would be required to make it real, we may simply go up a cul-de-sac and
have to retrace our steps.

We feel that the matter should be discussed by the housing improvement task
force. Backing up what Alan Ferguson said, I think that that should not be
an excuse for inaction. As with the homelessness task force, it would be
possible to have two phases, in the first of which we can identify what
needs to be done urgently and in the second of which we can take a
longer-term perspective. I will be very interested to see whether the
Executive's amendment at stage 2 will help matters along the road, but I do
not think that a bill itself can end fuel poverty, which is an aim that we
all share.

11:45

Cathie Craigie: As Brian Adam has already touched on some of the points
that I wanted to make, I will raise another issue. You have mentioned that
the bill does not touch on the private sector, which also faces big housing
problems. I believe that the changes to the repairs and improvement grants
can go a long way to tackling those difficulties. This morning, I asked
Scottish Executive representatives about changes to the right to buy.
Should the bill contain an element of compulsion that would make
owner-occupiers become involved in repair and improvement schemes with
local authority or registered social landlords who are the majority holder
in the stock?

Alan Ferguson: We must consider how we can encourage owners to take
responsibility—I mean owners in the traditional sense as well as people
who take up the right to buy—and how we help owners on limited incomes
carry out repairs.

Another issue is how we encourage in Scotland the kind of property
management system that exists in most other parts of the western world. I
am not sure that it is particularly helpful to consider the people who are
exercising their right to buy, as the problem is much broader than that. It
is clearly important that any tenant who wants to take up the right to buy
receives clear information on their responsibilities, but beyond that we
must find out how much disrepair there is in the owner-occupied sector and
how we encourage owners to take responsibility. That can be done partly
through a property management system.

Some of the more general discussion on how we tackle the problem will
emerge from the law of the tenement and the house and improvement task
force. The difficulty with properly regenerating many estates is that there
are now many owners as well as tenants in those areas and the owners say
that they cannot afford to make repairs and improvements. That problem must
be tackled, not least in Cathie Craigie's constituency. Although we can
take some short-term and some long-term measures, I am not sure that we can
do so through the bill on its own.

Cathie Craigie: You are right that there is a problem in my constituency.
We are trying to deal with it. Many people who have exercised the right to
buy have told me that they wish that they had been more organised when they
bought their house and that there had been a scheme that they could have
paid into so that they could carry out major repairs. Do you agree with
Beverly Francis that we should not be tackling those problems in this bill,
but in future bills or amendments to existing legislation?

Gavin Corbett: We would push a title conditions bill and a law of the
tenement bill. Perhaps we would be critical of the extent to which the
housing world—which probably includes ourselves and officials in the
development department—has engaged with those issues. We do not have the
right to be confident that those two pieces of legislation, which are
currently being progressed, will provide the solutions that housing
managers and tenants want. There is a lot of urgency to make the contents
of these bills more available for scrutiny instead of making them seem more
of a Scottish Law Commission-driven tidying-up of the process. There is a
big question about those bills and I am not at all confident that they will
provide the right framework.

Cathie Craigie: What is your view on ring-fencing?

Alan Ferguson: The institute has argued for a long time that there is a
problem with a lack of resources. When we took away the ring-fence, there
was a reduction in resources going to local authorities, which then decided
to spend the money in other ways. As a result, there has been a big
reduction in the money for improvement grants.

The issue is whether there is willingness on the part of ministers, council
leaders and council finance directors to return to ring-fencing. There are
ways to deal with that. Why not consider the money for grants as being part
of a single budget, rather than coming from the general fund? That way
there would be a pot of money that is, in reality, a single housing budget
that is used to fund council housing, development funding of RSLs or
improvement grants for owners. It would not be considered in the
traditional sense of ring-fencing.

Cathie Craigie: I am surprised to hear you say that there may be a move
back to ring-fencing by local authorities. How do you square that with the
fact that local authorities are democratically elected to take decisions at
a local level? If the Executive were to ring-fence any pot of money, in
effect that would mean that decisions were being taken more centrally on
how that money should be spent.

Alan Ferguson: There is already a ring-fenced budget in the housing revenue
account. With the proposal to move towards a single budget, that would
include development funding, but there would still be a ring-fenced budget.
What we are saying is that there would also be resources in that budget for
improvement grants for owner-occupiers.

Part of the difficulty is that there is a mindset in some local
authorities—especially among some councillors—that all owners are
well-off and do not need improvement grants. We need to change that.
Education and social work are considered to be important, but grants to
owners are not. We need to explain, in a dialogue with elected members of
councils, the importance of putting money into the owner-occupied sector.
First, it is the biggest sector; secondly, it is still a growing sector;
thirdly, there is a huge problem with disrepair. The danger is that we have
a time bomb because we are not investing now. We have to get across to
local authorities the importance of that, part of which might be to
consider it through the single housing budget.

The Convener: Thank you. I think Cathie Craigie has managed to get more
than her quota of supplementaries.

Ms White: I want to ask you about your response to the homelessness
provisions in the bill. In your response to the bill, you raise concerns
about the creation of administrative barriers that might prevent access to
the housing lists and housing for homeless people where a local authority
has transferred its stock to community ownership. Will you describe briefly
the barriers and explain what changes would be required to remove them?

Gavin Corbett: One is a general barrier, which is the practice by RSLs and
local authorities of excluding people from housing registers and waiting
lists. A welcome aspect of the bill is a provision to prevent that
happening.

Homelessness legislation grew up in the context of local authorities having
by far the most stock. Housing associations were generally quite small and
specialised; it was probably reasonable to expect them to have an
occasional or marginal role in responding to homelessness. That has changed
in the past few years. In some areas, housing associations are as
significant as local authorities in housing provision. With stock transfer,
that will accelerate.

The arrangements for nominations have been worked around 200 or 300 houses
in a housing association; that is not appropriate when there are hundreds
or—in some cases—thousands of homeless people in a local authority.
"Better Homes for Scotland's Communities" and the homelessness task force
set out a robust set of arrangements for dealing with that. The question is
whether the bill adequately develops it. It could be inferred from the bill
that a local authority has to ensure that it has exhausted the options in
its own stock before it asks the housing association to help out. That
would be unhelpful.

There is also a question about whether the arrangements for arbitration are
sufficiently backed up by the power to appoint a special manager, which was
suggested by the homelessness task force. The power is in the bill, but it
has been decoupled from the homelessness provisions. We might come back to
those issues in more detail, but they are the ones to watch at the moment.

Ms White: Housing stock transfers may lead to time gaps. I know that there
are short-term tenancies, but they are not always suitable for homeless
people. Do you see a problem there?

Gavin Corbett: There does not need to be a problem. As many people have
said, much of this will depend on how robust the guidance is; that is an
implementation issue. The framework that is in the bill could be sufficient
to ensure that homeless people do not lose out in transfers, but the devil
will be in the detail.

Robert Brown: On the Scottish secure tenancy, you point out—in relation
to section 10—that tenants of local housing co-operatives are excluded
from the new tenancy. Am I right that that leaves them as assured tenants?
Is that not a bit of an oddity? Are there any problems in connection with
that?

Alan Ferguson: The co-operatives you mention are the fully mutual ones; the
tenancies are neither assured nor secure because to be a tenant you have to
be a member and every member is a tenant. It is an anomaly, but it has
always existed. They have never had either secure or assured tenancies;
tenancies have been based on a tenancy agreement. That is why it is
proposed that they should be excluded from the new tenancy. I understand
that there are discussions between the Executive and the SFHA about whether
there should be any change to that and whether, at stage 2, an amendment
could be lodged to change it. At the moment, housing co-operatives are
excluded because the tenancies are different, in that they are neither
assured nor secure.

Robert Brown: I want to return to Cathie Craigie's points about
maintenance. You expressed reservations about the right to buy. Do you have
a view on the extent to which the right to buy should be extended before a
regime for adequate maintenance and sinking funds is in place? Is the right
to buy making the situation in multi-ownership buildings worse? There might
be a link there between the discount people get through exercising the
right to buy and adequate arrangements for paying into a fund to help
people, who tend to buy at the limits of what they can afford, with the
problems that that causes. Do you have any observations on that?

Alan Ferguson: There are a number of points I can make in the first
instance. If we do not tackle how we resource the problems in the
owner-occupied sector, there is a danger that we will add to the problem.
To go back to the convener's point, a time scale must be set. We need to
consider those issues and try to introduce further legislation—or
whatever other guidance is required—as soon as possible. There is a
danger that any extension of the right to buy could add to the existing
problems because no other system is in place.

I hope, however, that the proposals in the bill on designating pressured
areas and exempting associations for 10 years—and the possibility of that
period being extended—will lessen the problems that could arise if
nothing else to fund the problem is in place. There are several steps that
might reduce that problem.

Robert Brown: Those other steps have a different purpose, as their effect
may be to reduce the number the sales.

You touched on the right to buy in pressured areas without expressing any
particular observation. The whip hand on approving proposals seems to be
with the Scottish ministers, although there is a tiny gap. Are you
concerned that that provision will lead to a restricted and niggardly
application of the exemption? That would create major problems in areas
such as the west end of Glasgow and East Kilbride, where there has been
considerable demand and a large number of sales in the social rented
sector.

12:00

Gavin Corbett: Yes. The point that came up earlier was that we should be
trying to get the right balance between making the process useable,
particularly in the short term when local authorities will be gearing up
for, or developing, their new strategic role, and ensuring that people are
not unfairly discriminated against. In the short term, transitional
arrangements should be considered, to make it relatively easy for an
authority that hitherto has not gathered evidence or provided
information—such as a smaller, rural authority—to do so for legitimate
reasons without compromising the interests of new tenants. In the long
term, it is right to fit that into the strategic planning process. You
identified the short-term problem earlier.

Robert Brown: Do you think that there might be scope for what might be
described as an interim designation of pressured area—that is, an area
where it might take a year for someone who has applied for housing to go
through the procedures? If such a designation were applied straight away,
the position would be held until an area had been properly designated.
Would that be a useful addition to the bill?

Gavin Corbett: Yes.

The Convener: That is the sort of answer we like.

Brian Adam: One of the consequences of the right to buy is a distortion in
the balance of the housing stock that is left in the social rented sector.
Is there any merit in extending the exemptions in pressured areas, in
relation not only to geographical spread but to house type or size? I am
thinking in particular of the lack of large houses for large families.

Gavin Corbett: I get to deal with these questions because I was on the
working group that Richard Grant alluded to earlier. As he said, the
working group discussed the extension that you mentioned.

The problem lies in identifying particular house types and in gathering
evidence. We would like the guidance to make it clear that if pressure is
applied to particular house types—such as the example you gave—that
will be taken into account by the minister when he or she decides whether
to exempt a whole area. That short-term measure would have to be balanced
against the interests of other new tenants.

In the long term, it would be useful to consider whether we could refine
the system to take account of house type or size. A crucial aspect of the
new right to buy is that we should not simply unleash it and walk away,
coming back to it in five years' time to see how it has worked. Its impact
should be monitored continuously, refinements that can be made must be made
and ministers must use their powers actively to refine it.

Brian Adam: Some housing associations have schemes where tenants can buy
part of the house and rent part of the house. What consideration has been
given to the bill's implications, if there are any, for the folk who are in
that sort of arrangement?

Alan Ferguson: You are describing shared ownership, which a range of
housing associations developed and provide. I am not aware of any
difficulty for shared ownership, nor have difficulties been raised through
our members. We could think about that and come back to the committee.

The Convener: That would be helpful.

Karen Whitefield: I will ask Gavin Corbett the same question on pressured
areas that I put to the Executive witnesses, given that he sat on the
working party.

Are you aware of concerns that might exist among those who work in this
area about a reluctance to apply for pressured area status? What would you
like to be done to ensure that the criteria for such designation are not
too complicated?

Gavin Corbett: Robert Brown's suggestion on the interim arrangements is
quite good and worth exploring.

Two issues were raised in the working group. One was to do with political
reluctance, although that did not put us off. The working group discussed
whether housing associations should be able to apply to ministers
separately from local authorities when there is a problem with a particular
pressured area. The decision was that that would be inconsistent with the
new strategic role for local authorities and I think that that was probably
the right decision.

The second issue was about the short-term capacity of local authorities,
which presumably will be faced with a huge amount of new guidance and
regulations to implement, and whether seeking designation for pressured
areas will be a priority. Related to that genuine concern are issues to do
with resourcing the new strategic function, but those issues have not been
covered in full in the financial memorandum. The financial memorandum says
something about the homelessness function of local authorities, but there
are major questions about their capacity to deliver the local housing
strategy, particularly with regard to evidence and the right to buy, in at
least the first three or four years of the new system. Perhaps we could
come back to that issue.

Karen Whitefield: In your written evidence, you state that the ability of
Scottish Homes to regulate new forms of landlord has become strained due to
current legislation. Why do you believe that? Why do you think it is better
to create a new agency than to reform Scottish Homes?

Michael Thain: The advent of new housing partnerships in particular
strained the current regulatory framework as there was a move to develop
and introduce innovative forms of landlord that are not covered by the
definition of the sort of organisation that can register as a housing
association. Scottish Homes had therefore to introduce a form of
contractual regulation and everyone agrees that regulating by contract
rather than by statute is not the perfect way in which to regulate a body.

This is a difficult area and while we could take the approach that the bill
takes and define particular types of landlord, that would not take account
of the potential for developing new forms of landlord and the innovation
that may be thrown up in future. The other approach would be to suggest
that the executive agency, or Scottish Homes, should regulate all landlords
that provide social housing, but that would give us the problem of finding
a precise definition for social housing, given that many landlords are
involved in different activities.

We have not come to a conclusion on how to resolve those issues, but it is
worth looking into them. For example, there are landlords that are not
regulated by statute, such as Weslo Housing Management or Waverley Housing,
which are outwith the forms of regulation and may even be outwith the
definition of who can register under the bill.

The imperative that drives us within the single framework of regulation is
getting some sort of equality of protection for tenants, irrespective of
landlord. To a certain extent, that has been achieved across local
authorities, housing associations and the other bodies that fall within the
definition of registered social landlord. It would be useful for the
committee to consider that area as you take evidence from other
organisations.

Karen Whitefield: Despite the repeal of the secure tenancy, tenants who
live in the residual stock of Scottish Homes will not qualify for the new
tenancy. What does that mean for those tenants?

Michael Thain: It means that they will be left with a potentially inferior
tenancy.

We make a suggestion in our written evidence. If the committee believes
that it is right for Scottish Homes tenants to benefit from the new
tenancy—no matter how short a time they remain tenants of Scottish
Homes—depending how the transfer goes, it would be fairly straightforward
to insert Scottish Homes, for as long as it exists, into section 9, which
mentions local authorities, registered social landlords and water and
sewerage authorities. Perhaps such an amendment should be considered, as
our initial reading of the bill threw up that obvious gap of a group of
tenants who will not become Scottish secure tenants.

Bill Aitken: Will the requirement for local authorities to draft, implement
and review strategic housing plans result in plans that are relevant,
achievable and contemporary? If not, what action should be taken to ensure
that those objectives are achieved?

Alan Ferguson: I hope that the plans will be robust and that local
authorities will produce plans on which they consult and that are based on
proper assessments. However, we must have checks and balances. Not only
should the plans be submitted to ministers, there is a need to monitor the
plans to ensure that local authorities do what they say they will do or are
able to justify why they are digressing from the plans.

Bill Aitken: Is it significant that, in your response to the bill, you make
no comment about the strategic housing budgets? Do you have any comments to
make on the proposal to create such budgets?

Alan Ferguson: We supported the idea of a single housing budget, which is a
positive measure. In our written evidence, we say that the Executive should
also consider making the resources for improvement and repair grants part
of that budget. We argued that there is a need for a single budget. If the
local authority is the strategic body and if we are to enhance the powers
of that body, it makes sense for it to have a single budget and to carry
out the strategy. However, that is where the checks and balances are
needed, as they will ensure that local authorities deliver.

Bill Aitken: What about ring-fencing in the single housing budgets?

Alan Ferguson: That goes back to our earlier discussion about whether we
can say to local authorities, "Even within the single housing budget you
have to ring-fence some money to go on this area and not on that area."

There is an issue around the development funding for housing for RSLs. It
is clear that many RSLs are concerned that the local authority could either
skew that funding against them or not provide them with resources. The
committee must consider whether there is a need to ring-fence that
development funding and use it only for housing for RSLs. The committee
will be made aware of those concerns and will have to consider them.

The Convener: As there are no further questions from members, I thank the
witnesses for attending today and for their evidence, which we found
useful. I am aware that today was not their first visit to the committee,
but we have had a change of membership since their previous visit. I
suspect that it will not be their last visit, given the important
continuing work that is not covered in the bill, particularly on private
tenants.

We now move into private session.

12:13

Meeting continued in private until 12:36.


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