Consumers, Estate Agents and Redress Bill [Lords]

I welcome the Minister to his new post. We had a brief word earlier; he has previously covered many of the duties involved, and it is a pleasure to have dealings with him again. I also apologise on behalf of my hon. Friend the Member for Hertford and Stortford (Mr. Prisk). He is abroad on long-standing European business and cannot be present, so I am dealing with this Bill in his place, although I did not take it through Committee. One of the matters that received a lot of attention in Committee was part 3 of the Bill, which deals with the regulation of estate agency. New clause 1 and the Liberal Democrats’ new clause 2 give us a very good opportunity to have a real discussion on Report today about what the Bill does and does not cover in terms of regulation of the residential market. There are indeed some grey areas, which I shall come to in due course. The purpose of our new clause is to permit the Secretary of State to amend the definition of estate agency work by statutory instrument, subject to affirmation by both Houses. This follows the amendments that we tabled in Committee to amend the definition of estate agency work in the Estate Agents Act 1979. Clearly, 1979 was a long time ago, and the residential market has moved on a great deal since that legislation was enacted. Indeed, residential lettings, which are not covered by the Bill, have increased by at least a third since then. The purpose of the new clause is therefore to amend the definition of estate agency work in the 1979 Act to take into account direct and off-plan sales by house builders, and to bring residential lettings within its scope. As a result, all those activities would be subject to the new redress and other procedures in the Bill—we welcome them—which would aid consumers. The Government rejected the Conservative amendments, claiming that they wanted to consult consumers and the industry before deciding whether the law needed amending, and I have no doubt that the Minister will say that today. The idea is that Ministers would in future introduce legislation to deal with that subject. However, the Government have had more than enough time to consider these matters, and there has been more than enough in the way of studies and lobbying from the various groups involved to be able to consider how the residential market should be regulated. The new clause allows us, as I said, to debate the need to update the definition of estate agency work to take into account the rising number of direct sales of houses and the need to include residential lettings so that everyone is covered under the improved redress scheme. Estate agents are already regulated by a number of Acts. The 1979 Act contains a negative licensing provision whereby an estate agent who has breached the Act’s provisions and/or been convicted of certain criminal offences may be banned. However, that is a negative, after-the-event licensing regime. Section 22 of the 1979 Act contains a provision to regulate the standards of competence for estate agency, but it was never enacted. The Earl of Caithness tried to move an amendment on Third Reading in that regard, but it was not carried. The Property Misdescriptions Act 1991 made provision for it to be a criminal offence to make false or misleading statements, in written or oral form, about certain matters relating to property. Estate agents were further regulated by the Enterprise Act 2002, which enabled the Office of Fair Trading and trading standards to obtain injunctions to stop estate agents breaching protective legislation, so there is already a considerable amount of legislation surrounding estate agents, who were of course further regulated by the Housing Act 2004. Some 10,000 estate agents are members of the National Association of Estate Agents, but it is estimated that only 66 per cent. of all estate agents are members of that professional body. At this point, I should declare an interest as one of only four chartered surveyors in the House.