2008 Chapter 17

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These notes refer to the Housing and Regeneration Act 2008 (c.17) which received Royal Assent on 22 July 2008

HOUSING AND REGENERATION ACT 2008

EXPLANATORY NOTES

INTRODUCTION

1.     These explanatory notes relate to the Housing and Regeneration Act 2008 which received Royal Assent on 22 July 2008. They have been prepared by the Department for Communities and Local Government in order to assist the reader of the Act. They do not form part of the Act and have not been endorsed by Parliament.

2.     The notes need to be read in conjunction with the Act. They are not, and are not meant to be, a comprehensive description of the Act. So where a section or part of a section does not seem to require any explanation or comment, none is given.

BACKGROUND AND SUMMARY

3.     The Housing and Regeneration Act gives effect to the Government's proposals to create the Homes and Communities Agency (HCA) and the Office for Tenants and Social Landlords (TSA). The Prime Minister's statement to Parliament of 11 July 2007 on the draft legislative programme set out the context for the Act. The Queen's Speech on 6th November 2007 confirmed that "available and affordable housing is one of my Government's main priorities. Legislation will be introduced to create a new Homes and Communities Agency that will deliver more social and affordable housing, and promote regeneration."

4.     Professor Martin Cave began an independent review of social housing regulation on 14th December 2006. Professor Cave's remit was to establish a clear set of objectives for the regulation of social housing to underpin any new regulatory system, present options for reform and make recommendations about institutional arrangements. His report Every Tenant Matters: A review of social housing regulation, was published on 19th June 2007. On the same day, the Government launched the consultation paper Delivering Housing and Regeneration: Communities England and the future of social housing regulation. This paper took forward Professor Cave's recommendations and set out proposals on the role, responsibilities and operation of Communities England, now the HCA. The then Minister for Housing and Planning, Yvette Cooper MP, made a statement to Parliament on 15th October 2007, which set out further detail on the new social housing regulator, the Office for Tenants and Social Landlords. The Government's Housing Green Paper Homes for the future: more affordable, more sustainable, published on 23rd July 2007, set out the role of the HCA in the context of the proposals set out in the Green Paper.

5.     This Act follows from these reviews, consultations and statements.

6.     Part 1 of the Act creates the HCA and sets out its objects and powers. The objects of the HCA will be to improve the supply and quality of housing in England; to secure the regeneration or development of land or infrastructure in England; to support in other ways the creation, regeneration or development of communities in England or their continued well-being; and to contribute to sustainable development and good design. The Act also abolishes the predecessor organisations of the Urban Regeneration Agency and the Commission for the New Towns, which operated under the joint name of English Partnerships. The powers of the HCA are modelled to a large extent on those of the Urban Regeneration Agency. The HCA will take on the functions of those organisations and also certain functions of the Housing Corporation, related to investment in housing.

7.     Part 2 of the Act creates the new social housing regulator, the Office for Tenants and Social Landlords, and sets out its objectives and powers. The new regulator will regulate social housing in England provided by registered providers (which will include current Registered Social Landlords (RSLs), along with other bodies who choose to register). The new regulator will take on the regulation functions of the Housing Corporation. The Act also abolishes the Housing Corporation.

8.     The Act also gives effect to other measures in relation to housing services which were proposed in or alongside the Housing Green Paper Homes for the future: more affordable, more sustainable on 23rd July 2007:

• proposals to enable certain local housing authorities, on application to the Secretary of State, to keep rental income from new supply dwellings (included in the Housing Green Paper);

• proposals to enable certain local housing authorities, on application to the Secretary of State, to opt out of the Housing Revenue Account Subsidy system (included in the Housing Green Paper); and

• proposals that a rating against prescribed sustainability standards should be introduced for new homes, indicating whether the home has been assessed and, if it has, the performance of the home against the standards (proposed in The future of the Code for Sustainable Homes - Making a rating mandatory, published on 23rd July 2007 alongside the Housing Green Paper).

9.     The Act also gives effect to a number of measures in the consultation paper Tenant Empowerment: A Consultation Paper, published on 11th July 2007, which set out proposals to increase tenant empowerment. The Act gives effect to proposals to:

• introduce a requirement for a local authority to hold a statutory ballot to ascertain tenants' views before seeking consent from the Secretary of State in relation to England or the Welsh Ministers in relation to Wales to transfer its housing stock to a private sector landlord; and

• give local authority tenants powers to consider the options for the future management of their housing stock and, if they desire, to effect a change of a landlord (subject to certain conditions).

10.     The Act also gives effect to other measures in relation to housing services:

• to allow local authorities and RSLs to offer tenancies which are not secure or assured to families referred to Family Intervention Projects;

• to reform the law relating to tolerated trespassers by preventing the creation of tolerated trespassers in the future; and restoring tenancy status to existing tolerated trespassers, as set out in Tolerated trespassers: A consultation paper, published on 20^th August 2007;

• to make changes to the requirements in the 1985 and 1987 Landlord and Tenant Acts about the information landlords will be required to supply to service charge payers and how service charges monies are held, as set out in Commonhold and Leasehold Reform Act 2002: A Consultation Paper on Regular Statements of Account and Designated Client Accounts, published on 25^th July 2007;

• to protect providers of shared ownership housing from early enfranchisement ¹ and to allow limits on the maximum equity share which shared owners can buy to keep homes available as affordable housing in areas designated as protected by the Secretary of State in relation to England and by the Welsh Ministers in relation to Wales;

¹Shared owners buying their freehold before they have acquired full ownership of their home by buying further shares under the terms of their lease

• minor amendments to the way the right to buy scheme works, as set out in Clarifying the Right to Buy rules: a consultation paper, published on 22nd August 2007;

• to enable service personnel to establish a local connection with the district in which they serve, for the purpose of applying to a local housing authority for an allocation of social housing or homelessness assistance;

• to remove the requirement on local housing authorities that they be accepted by the Secretary of State for inclusion on an annual disposals programme before seeking her consent to a large scale transfer of housing to the private sector;

• to widen the existing power for the Secretary of State in relation to England and Welsh Ministers in relation to Wales to provide financial assistance for the giving of general advice in respect of residential landlord and tenant law; information and training and for running an alternative dispute resolution service;

• to extend from six months to two years the time limit for local authorities to prosecute those who breach any provision of building regulations to which section 35 (penalty for contravening building regulations) of the Building Act 1984 applies, as set out in Longer time limits for prosecution of breaches of Building Regulations - Consultation, published on 31st July 2007;

• to provide the same security of tenure, and other rights and responsibilities, to gypsies and travellers on local authority sites as gypsies and travellers on private sites, and occupants of other types of residential caravan site, such as park home sites. This is in response to the European Court of Human Rights ruling in the case of Connors v United Kingdom in 2004. The ruling can be found on the European Court of Human Rights portal at http://cmiskp.echr.coe.int/tkp197/view.asp?action=html&documentId=699671&portal=hbkm&source=externalbydocnumber&table=F69A27FD8FB86142BF01C1166DEA398649;

• to widen the existing power for the Lord Chancellor to provide financial assistance for the giving of general advice in respect of the law relating to commonhold land relating to residential matters, information and training and an alternative dispute resolution service; and

• to remedy a declaration of incompatibility of the European Convention of Human Rights in relation to section 185(4) of the Housing Act 1996 and section 119(1) of the Immigration and Asylum Act 1999 and Article 7A(4) of the Housing (Northern Ireland) Order 1988.

STRUCTURE OF THE ACT

11.     The Act is set out as follows:

• Part 1 - The Homes and Communities Agency

•      Chapter 1 - General

•      Chapter 2 - Land and infrastructure

•      Chapter 3 - Financial provision

•      Chapter 4 - Other functions of the HCA

•      Chapter 5 - Supplementary

• Part 2 - Regulation of Social Housing

•      Chapter 1 - Introduction

•      Chapter 2 - The Social Housing Regulator<

•      Chapter 3 - Registration

•      Chapter 4 - Registered providers

•      Chapter 5 - Disposal of property

•      Chapter 6 - Regulatory powers

•      Chapter 7 - Enforcement powers

•      Chapter 8 - General

• Part 3 - Other provisions

•      Chapter 1 - Sustainability certificates

•      Chapter 2 - Landlord and tenant matters

•      Chapter 3 - Housing finance and other provisions

• Part 4 - Supplementary and final provisions

• Schedule 1 - The Homes and Communities Agency

• Schedule 2 - Acquisition of land

• Schedule 3 - Main powers in relation to land of the HCA

• Schedule 4 - Powers in relation to, and for, statutory undertakers

• Schedule 5 - Amendments to the New Towns Act 1981

• Schedule 6 - Transfer schemes

• Schedule 7 - Transfer schemes: tax

• Schedule 8 - Amendments of enactments: Part 1

• Schedule 9 - Amendments of enactments: Part 2

• Schedule 10 - Penalty charge notices

• Schedule 11 - Possession orders relating to certain tenancies

• Schedule 12- Service charges: provision of information and designated accounts

• Schedule 13 - Demolition notices

• Schedule 14 - Disposals of dwelling-houses by local authorities

• Schedule 15 - Ineligible persons from abroad: statutory disregards

• Schedule 16 - Repeals and revocations

TERRITORIAL EXTENT

12.     Parts 1 to 3 of the Act extend to England and Wales only except so far as they amend, repeal or revoke existing provisions (in which case they generally have the same extent as the provisions concerned). The repeals and revocations in Schedule 16 also generally have the same extent as the provisions repealed or revoked. Parts 1 and 2 of the Act generally apply to England only, although some consequential matters will apply to Wales and some may extend and apply to Scotland and Northern Ireland also. Part 3 of the Act generally applies to England and Wales although the amendments made to remedy the declaration of incompatibility include amendments which apply in Scotland and Northern Ireland (see Schedule 15).

13.     The Scottish Parliament has given their consent to subsection (3) of section 66, which repeals section 33A of the Housing Associations Act 1985 which provides for the Welsh Ministers in relation to Wales, the Scottish Ministers in relation to Scotland and the Secretary of State in relation to England to enter into agreements with the Housing Corporation.

TERRITORIAL APPLICATION: WALES

14.     Part 1 of the Act mainly applies to England only but consequential amendments apply to Wales. The HCA will generally operate in England only and so any functions of the Secretary of State in relation to the HCA will generally apply in England only. This Part also abolishes the Commission for the New Towns. Functions of the Commission for the New Towns in England are being transferred to the HCA. Functions of the Commission for the New Towns in Wales are being transferred to the Welsh Ministers and any residual assets of the Commission for New Towns in Wales are also being transferred to Welsh Ministers.

15.     Part 2 of the Act mainly applies to England only but consequential amendments apply to Wales. The Office for Tenants and Social Landlords will operate in England only and so any functions of the Secretary of State in relation to the regulator will apply in England only.

16.     Part 3 of the Act applies to England and Wales. Powers will be exercised by the Secretary of State in relation to England and by Welsh Ministers in relation to Wales. Further details about Part 3 are contained in Annex A.

PART 1 - THE HOMES AND COMMUNITIES AGENCY

Chapter 1 - General

Section 1 - Establishment and constitution

17.     This section establishes the Homes and Communities Agency ("HCA") and introduces Schedule 1.

Sections 2 to 4 - Objects: Principal powers: Powers: general

18.     The HCA will operate across England, with a view to meeting the needs of people in England, by:

• improving the supply and quality of housing;

• securing the regeneration or development of land or infrastructure;

• supporting in other ways the creation, regeneration or development of communities or their continued well-being; and

• contributing to the achievement of sustainable development and good design.

19.     These objects are broadly drawn to reflect the wide range of activities that the HCA will undertake at a national level. It will work to improve housing supply, including tackling housing shortages, and to improve the quality of housing including the condition of housing. It will also undertake the regeneration and development of any type of land or infrastructure; and will have a more general role supporting the overall well-being of communities, in relation to which it will be able to establish new communities or work to regenerate or develop existing communities. It will also work to contribute to the achievement of sustainable development and good design. Section 2(2) provides that "good design" includes design which has due regard to the needs of elderly and disabled persons. The HCA will also act as the residuary body for the development corporations for new towns established under the New Towns Act 1981 and for urban development corporations (which is currently the function of the Commission for the New Towns), as set out in section 52.

20.     Generally, the HCA may do anything it considers appropriate for the purposes of its objects or for purposes incidental to them and its specific powers are set out in Chapters 2 to 4 of Part 1. Many of these powers are modelled on the powers available to the Urban Regeneration Agency, the Commission for the New Towns and the Housing Corporation.

21.     The powers of the HCA are to be exercised for the purposes of the objects (or for purposes incidental to them) only. Those powers may be exercised independently of each other or together. Where the HCA is conferred with functions of the local planning authority in relation to a designated area under section 13, it will not be constrained by its objects in exercising those powers (but, in this situation, it will exercise those functions in accordance with existing planning legislation). Section 2(4) also refers to sections 19 and 44 of the Act, which make provision as to the objects of the HCA.

Chapter 2 - Land and infrastructure

General

Sections 5 to 7 - Powers to provide housing or other land; Powers for regeneration, development or effective use of land; Powers in relation to infrastructure

22.     Section 5 enables the HCA to provide or facilitate the provision of housing or other land. Subsection (3) explains the meaning of "provide" in this context.

23.     Section 6 enables the HCA, directly or indirectly, to regenerate or develop land and bring land into more effective use.

24.     Section 7 enables the HCA to provide or facilitate the provision of infrastructure. Infrastructure is defined in section 2(3) and includes, for example, utilities such as water, electricity, gas, transport facilities, retail and other business facilities. Subsection (3) explains the meaning of "provide" in this context.

Powers to deal with land etc.

Section 8 - Powers to deal with land etc.

25.     The HCA will be able to acquire, hold, improve, manage, reclaim, repair or dispose of housing or other land or property, or facilitate these activities. It will also be able to carry out building and other operations, including the demolition or conversion of buildings, or facilitate such operations. These powers are modelled on those of the Urban Regeneration Agency.

Section 9 - Acquisition of land

26.     The HCA may need to acquire land in order to achieve its objects. The HCA will therefore be able to purchase land by agreement or may, where authorised to do so by the Secretary of State, acquire land and new rights over land compulsorily. This section is modelled on the powers of the Urban Regeneration Agency under section 162 of the Leasehold Reform, Housing and Urban Development Act 1993.

27.     This section also introduces Schedule 2.

Section 10 - Restrictions on disposal of land

28.     The HCA is not permitted to dispose of land for less than the best consideration it can reasonably obtain, unless the Secretary of State consents (section 48 provides that the Secretary of State may give consent, where required under Part 1, generally or specifically). The restriction to dispose of land for less than best consideration does not apply where the HCA proposes to dispose of land by granting or assigning a short tenancy, that is to say of a term of seven years or less.

29.     Unless the Secretary of State consents, the HCA is not permitted to dispose of land that it has acquired by way of compulsory purchase. Such a disposal would also be subject to the restrictions on disposal at less than best consideration. Aside from this, the HCA may dispose of land held by it in any way it considers appropriate.

Powers in relation to acquired land

Section 11 - Main powers in relation to acquired land

30.     Section 11 introduces Schedule 3.

Section 12 - Powers in relation to, and for, statutory undertakers

31.     Section 12 introduces Schedule 4.

Planning

Sections 13 and 14 - Power of Secretary of State to make designation orders; The HCA as the local planning authority; Contents of designation orders

32.     Section 13 gives the Secretary of State power to designate an area in England where she is of the opinion that the area is suitable for development and that it is appropriate for the HCA to be the local planning authority for the whole or part of the area for particular "permitted purposes" and in relation to particular kinds of development. It will only be "appropriate" if making the designation order is likely to improve the effectiveness with which the planning functions for the area or part of the area are discharged.

33.     The designation of an area is to be made by order and before making such an order the Secretary of State is required to publish a draft of the order and her reasons for making it, and to consult a variety of bodies including every local authority or local planning authority who has an area, or part of an area, in the proposed designated area, persons representing the interests of local authorities and people who live or carry on business in the proposed designated area.

34.     The range of planning functions that can be conferred on the HCA under a designation order provide the Secretary of State with the flexibility to confer only those functions considered to be necessary for that area. Section 14 sets out the functions which may be conferred on the HCA in relation to that designated area. In particular the designation order may provide that the HCA is to be the local planning authority in relation to development control under Part 3 of the Town and Country Planning Act 1990, it may be the local planning authority in relation to applications for listed building and conservation area consent and it may be the hazardous substances authority for the designated area. A designation order may also confer certain other planning functions (those which are not conferred on a local planning authority per se) on the HCA, either instead of or concurrently with, other persons who have them. An example of such a function is that of keeping enforcement notice registers, a function of the district council planning authority, district council or London borough council.

35.     Section 14 also enables the Secretary of State to confer responsibility on the HCA for preparing and maintaining all or part of the local development framework for the designated area. Conferring such powers may be useful in instances where a designated area covers two or more local authority areas.

36.     Where the HCA is the local planning authority for a designated area, the designation order can ensure that it will be bound by the same legislation, consultation requirements and restrictions as any other local planning authority. The procedures set out in the Town and Country Planning (General Development Procedure) Order 1995 are expected to apply where the HCA is an "interested planning authority". In addition, it is expected that the HCA would also need to have regard to the same policies as any other local planning authority, whether these are development plan policies or policies of the Secretary of State.

37.     Where the functions of a local planning authority or hazardous substances authority are conferred upon the HCA in relation to a designated area, it can have the power under the applied legislation to charge fees in relation to certain applications. The Secretary of State is given the power to prescribe in regulations fees payable for certain applications, including applications for planning permission and hazardous substances consent. The power to set fees in relation to applications for planning permission is found in section 303 of the Town and Country Planning Act 1990. Regulations made under this section are subject to the affirmative resolution procedure. In relation to applications for hazardous substances consent, the power of the Secretary of State to prescribe fees is found in section 26A of the Planning (Hazardous Substances) Act 1990. The Secretary of State also has the power to prescribe for the making of reasonable charges for the provision of copies of documents required by or under Part 2 of the Planning and Compulsory Purchase Act 2004. Whilst there is no express restriction on the regulation making powers to restrict fees to cover costs, the intention is that the power will be so exercised.

Section 15 - HCA as local planning authority: local involvement

38.     Prior to exercising any function conferred upon it by a designation order, the HCA must prepare and publish a statement of local involvement. The statement will set out the HCA's policy on how it intends to involve affected local authorities, and other particular persons, in the exercise of functions conferred upon it by a designation order. This statement must be kept under review and revisions must be published. Where the HCA establishes a committee or sub-committee for the purposes of exercising those functions, every local authority within the designated area can suggest one or more candidates for membership to that committee or sub-committee