Consumers, Estate Agents and Redress Bill [HL]

My Lords, Amendment No. 88, tabled by the noble Earl, Lord Caithness, introduces minimum standards of competence for estate agents. I am grateful to the noble Earl for his explanation of his intent behind the amendment. As he mentioned, we discussed this before. The amended Section 22 would require the Secretary of State to designate certain approved bodies that estate agents must belong to. Membership of those bodies would be conditional on agents signing up to the rules andcode of conduct of the body concerned, whichmust include certain competency standards and requirements. I appreciate the points made by the noble Lords, Lord Lee of Trafford and Lord Dubs, but as I have explained before, positive licensing was looked at in detail by the OFT, which concluded that its benefits are not justified by its costs. The Government share this view. Giving trading and professional bodies control of access to the market could reduce competition and result in rising prices, to the detriment of consumers. There is little evidence that such controls would prevent rogue agents entering the market or remove those agents whose misconduct is predominantly the result of a lack of integrity, rather than a lack of qualifications. However, the Government support moves to develop national quality standards for residential estate agents in the UK. We see merit in that as, properly done, it can provide an incentive to raise standards. But this is a matter primarily for the industry. We do not support the imposition of compulsory qualifications and standards, which would amount to positive licensing. I recognise that the noble Earl feels passionately about this issue, which he has raised on a number of occasions over many years. I reassert the Government’s intention, which is to improve the current negative licensing regime. The fact that we are setting up redress schemes has been widely welcomed. Requiring agents to join approved redress schemes and making it easier for enforcers to prove misconduct and take enforcement action is the most effective way of tackling problems in the industry without driving up costs for consumers. The noble Earl mentioned the European issue. At the moment, no decision has yet been taken on whether an EU directive is needed in this area.