I had to read up on Home Information Packs last week and then write about them. The context, a law firm clients’ web site and Blog, was such that I could not be too rude about HIPs, so I simply described them as a useless waste of time and money and copied the requirements from the Government’s web site.
It set me wondering, though, how such stupidity originates and moves from being the spawn of under-nourished brain and under-employed hand to become legislation passed by a majority of the Mother of Parliaments.
I suspect it began with one of those justifiably anonymous back-benchers with a name to make and no talent to make it with. Perhaps a constituent came whining to him that he had spent money investigating the purchase of a house which proved unsuitable, and that someone else should pay for it.
The idea that the property vendor should prepare a detailed report gives us a double-dose of bastardised socialism in one. Where previously a few people wasted a few hundred pounds occasionally, now everyone does every time – such equality of outcome is what socialism means is it not? Furthermore, the loss was transferred from the buyer (deserving aspirant seeking to better himself) to the seller (capitalist pig gloating over his undeserved profits). Logical – no. Typical – alas yes.
The idea reached John Prescott’s vast department, in its long “all initiative no brain” phase. There it met the requirements of all concerned. Civil servants had a new project to keep them occupied, one with no time-scale, no risk, no difficult decisions and no pressure while they clocked up a few more years towards retirement and their pensions. Two-planks Prescott had something new to announce. For him, the fact that the idea would upset at least as many people as it pleased gave it a particular edge.
And so was born the Home Information Pack. The flagship element was the wholly new Home Condition Report which tried to shift onto the seller the burden of paying for a survey report. Most of the rest, frankly, is what any competent conveyancer would expect to give and receive. The Home Condition Report was the only novelty.
The howls of protest were at first music to the government’s ears – estate agents and home-owners predicting a depressed housing market always plays well with the groundlings, or so the Labour strategists think. Does it though? Every would-be house buyer is an actual or potential house seller for whom the HIPs are just another tax on moving home. A burden which discourages people from selling reduces the number of properties on the market which in turn drives prices up. The real losers would be the first-time buyers for whom New Labour professes such concern.
The Government ignored the protests. But there was a more forceful opponent to reckon with and one who could not be bullied or ignored. Mortgage lenders made it clear that they would not accept a Home Condition Report prepared by the vendor as evidence of either value or condition. Every such report would be duplicated.
It is hard to see how Labour missed this one. Prescott, of course, would miss anything which could not be groped, but you would think that someone would have realised that the primary principle of the law of negligence – the scope of the duty of care owed to one who was not party to the valuation – would cause this idea to founder, quite apart from the lenders’ right to choose their own valuers.
The Government soldiered on with attempts to persuade the lending industry to back its proposals, and then abruptly caved in. The Home Condition Report became optional or, in Government-speak, “authorised” as opposed to “required”. “Authorised” by whom, incidentally – if it is not compulsory then parties may choose to do as they wish; the antonym of “authorised” is “forbidden” and it is characteristic of New Labour that it must choose a word which implies a power which does not exist.
So the Government is left with egg on its face, and sellers are faced with a statutory code which, with one exception, says no more than common-sense and good conveyancing practice has always required. The exception is an Energy Performance Certificate, a superfluous bit of paper whose main purpose seems to be a fig-leaf to preserve the decency of the original and now emasculated proposals, and to provide job opportunities for failed surveyors.
The rules come into force on 1 June. A “consultation” was launched as late as 25 January to cover elements which are still contentious, such as searches and leaseholds.
There are many elements here which fit the New Labour pattern: –
- Interference in private contracts
- Unintentional destabilisation of the market to the disadvantage of those most in need of stability
- Ignorance of the relevant law and practice
- Lots of work primarily designed to keep civil servants in employment
- A career opportunity for an ambitious minister – Yvette Cooper, wife of the cerebral but impractical Ed Balls, the inventor of Tax Credits and other expensive disasters.
- Vast expense both within Government and for those affected by the change
- An arrogant assumption that the market can be bent to government will
- A training programme for Home Condition Report Inspectors which cost a fortune to set up, attracted few applicants and is made redundant by the change of tack
- Consultation premised on the assumption that Government would simply ride over objections
- Disarray and uncertainty in the closing stages of a an expensive three-year programme whose victims will not be ministers or the nodding dogs at the ministry but property sellers and buyers and their conveyancers
- Few if any winners in real terms – the answer to the question no-one asked