Government spin machine working overtime on HIPs
Posted on 23 May 2007 by
The Government finally backed down on HIPs on Tuesday afternoon and announced that the start date will be deferred by 2 months to 1 August this year and even then only for properties with at least 4 bedrooms.
The judicial review sought by RICS was the catalyst for this and the Government stated that nearly a week ago, last Wednesday, the judge issued an interim order which would have effectively prevented the introduction of Energy Performance Certificates (EPCs) on 1 June, while the case was being considered. In the interests of Open Government perhaps they might have told us about this earlier, particularly as we are so close to the previous 1 June start date.
The Government stated that "We did not consider it to be acceptable or practical to delay the introduction of EPCs in this way." So much for respecting decisions of the Courts when it goes against you!
Communities Secretary Ruth Kelly then claimed that the Government had reached an agreement with the Royal Institution of Chartered Surveyors (RICS) on their judicial review of Energy Performance Certificates.
She claimed that the majority of the new energy assessors who had been fully accredited, all 520 of them compared with the 2,500 the Government admits are needed, (see my blog post earlier today) expect to start work in June. No doubt they did but most won't be able to now and so this is rather an odd claim.
She also claimed the issue of the judicial review was now resolved as The Government had today reached agreement with RICS over the Judicial Review and potentially avoided a lengthy court case and months of delays.
However, RICS issued a statement which refuted this. Their spokesman, Jeremy Leaf said: "RICS has not withdrawn the Judicial Review – it has been ‘stayed’ and can be reactivated if the Government fails to deliver on its obligations.
"RICS has not agreed to what the Minister outlined in Parliament today.
"RICS has only agreed to the stay of the Judicial Review on the following terms:
The Government provide a 12 week consultation period on EPCs.
The Government publish a Regulatory Impact Assessment (including a full cost-benefit analysis).
The Government pay RICS' legal costs.
"We will be examining the new proposals in detail, and will continue to work in the public interest on home buying reform and climate change."
I think I would rather believe RICS than the Government on this topic. Thus, even the new 1 August start date could be deferred as clearly this date doesn't allow enough time for a 12 week consultation period. As the Government is clearly not prepared to be magnanimous in defeat they appear to prefer HIPs to be subject to death by a thousand cuts.
And don't forget David Cameron has promised to abort HIPs if he wins the next election, although he will keep the energy performance certificate. Thus potential home inspectors need to give very serious consideration before spending around £8,000 getting accredited, although energy assessors will still have a job.
The Council of Mortgage Lenders (CML) has stated that their data indicates that 17% of homes have 4 or more bedrooms. 70% of homes are owner occupied (The Government's target of 75% by the end of this Parliament will clearly not be met) and so the requirement that initially HIPs will only be required for properties with at least 4 bedrooms means that only 12% of the housing stock will initially be caught by the HIP legislation. I have a 4 bedroom house but most of the time one room is used for storage and I can see a lot of 4 bedroom houses being marketed as 3 bedrooms with another room which could be used as a bedroom! I am sure estate agents will be able to find an innovative way of letting prospective buyers know which 3 bedroom houses are really 4 bedrooms!
Alan Dring, sales director at eConveyancer, is understandably unhappy about the situation. He was quoted on the Mortgage Strategy website as saying: "What a farce - with just over a week to go, the government decides to put the brakes on HIPs for two months.
"Never again should a piece of legislation be allowed to be introduced in such a shambolic way.
"In future, business should refuse to co-operate with any legislative proposals unless it is given a minimum guaranteed breathing space of six months between legislation being passed and implemented, in which the government is not allowed to make any further changes."
"If a lender had made such a mess of a new business or product launch, heads would most certainly roll.
"Will housing minister Yvette Cooper do the honourable thing and fall on her sword? Not likely.
"She'll wait for Gordon Brown to become Prime Minister and will probably be rewarded with a post at his top table. How the life of politicians differs to those of us who have to live in the real world."
Robert Bryant-Pearson, chief executive of Allied Surveyors, said:
"This is the second time we have been jilted at the altar."
"The problem that we are faced with when the government appoints people without any business experience or acumen to ministerial posts is that we have little option but to go along with draft regulations and to trust that ministers will deliver somewhere near what they promise."
"Judging from past experience, Yvette Cooper and Ruth Kelly are both too churlish to resign gracefully and, having destroyed their credibility, will merely wait to be sacked."
Categories: Property market, HIPs
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