Grand Committee

Wednesday 10th September 2025

(1 day, 19 hours ago)

Grand Committee
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Wednesday 10 September 2025

Hovercraft (Application of Enactments) (Amendment) Order 2025

Wednesday 10th September 2025

(1 day, 19 hours ago)

Grand Committee
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Considered in Grand Committee
16:15
Moved by
Lord Hendy of Richmond Hill Portrait Lord Hendy of Richmond Hill
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That the Grand Committee do consider the Hovercraft (Application of Enactments) (Amendment) Order 2025.

Lord Hendy of Richmond Hill Portrait The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
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My Lords, the purpose of this draft order is to amend the Hovercraft (Application of Enactments) Order 1989 and thus to ensure that the full suite of maritime legal powers currently available in relation to ships is also available, where applicable, to regulate hovercraft operating in the United Kingdom.

Noble Lords will wish to know that the Joint Committee on Statutory Instruments considered a draft of the order before it was laid and then gave informal pre-laying approval. After the draft order was laid on 1 July, it was formally cleared by the Joint Committee in its Thirty-second Report of Session 2024-25. Likewise, the Secondary Legislation Scrutiny Committee formally cleared the draft order as an instrument not drawn to the special attention of the House in its 32nd Report of Session 2024–25. Prior to this, the MCA responded to preliminary enquiries from the committee’s clerk to the satisfaction of the committee.

The background to the order is that the United Kingdom currently has one commercial hovercraft operation comprising two hovercraft which operate in in-shore waters between Portsmouth and the Isle of Wight. Those hovercraft are regulated as high-speed craft and comply fully with the existing relevant legislation.

The principal piece of legislation governing hovercraft is the Hovercraft Act 1968. The Act enables Orders in Council to be made to bring hovercraft within the scope of any relevant corresponding ship requirements under the Merchant Shipping Act 1995. This is because hovercraft operate at sea in the same way as ships.

Using the powers in the 1968 Act, an order was originally made in 1989—the Hovercraft (Application of Enactments) Order 1989—and this is the basis on which current relevant ship requirements are applied to hovercraft. This new order, if approved, will amend the 1989 order to make it possible in future to apply relevant legislation made in or under the 1995 Act to hovercraft as it already applies to ships.

We intend to make this order now because, for the purpose of extending the current Merchant Shipping (Fees) Regulations in November 2025, it is necessary to ensure that, in relation to all possible future hovercraft operations, the department will be able to charge fees for regulating hovercraft in the same way that it charges fees for regulating other types of ships. The statutory instrument will contain powers, through the use of provision for ambulatory reference, to ensure that, where necessary, legislation for hovercraft can keep pace with changes to the corresponding legislation covering ships.

This order includes provision relating to safety requirements, pollution prevention measures and inquiries and investigations into ship casualties, ensuring that hovercraft will remain subject to the same modern regulatory standards as ships where this is necessary. This supports consistency, safety, the protection of the marine environment and growth across maritime operations. The order also updates some provision in the existing 1989 order to bring it up to current drafting standards.

Although the department considers that there is no gap in legal powers in respect of the existing hovercraft operation in the United Kingdom because that operation is regulated under the legislation governing high-speed craft, the department nevertheless acknowledges that the existing 1989 order has fallen behind in its alignment with current regulations for ships and considers it appropriate to take steps to resolve this. This order will ensure that the department’s ability properly to regulate future hovercraft operations in the United Kingdom is not impeded by regulations designed for a previous generation of craft.

Since the existing 1989 order was made, it has been amended twice to align it more closely with requirements for ships. As well as introducing the power to enable the department to charge fees fully in line with the fees structure for ships, this order, if approved, will also update provisions for safety regulations and casualty investigations. Notably, the order will also update the pollution prevention provisions when it comes to the availability of powers for the prevention of pollution of the marine environment by sewage and garbage, oil, liquid chemicals, dangerous goods, harmful substances and air emissions.

The order also makes specific provision to apply the ambulatory reference powers in the Merchant Shipping Act 1995. This will mean that, where there is provision in regulations for ambulatory reference to ship requirements, and where those ship requirements are applied to hovercraft by this order, the ambulatory reference provision will also cover those requirements as they apply to hovercraft. This will, in turn, ensure that the relevant legislation for hovercraft will keep pace with international standards in the same way as it does for ships, ensuring that safety and pollution prevention standards are maintained and that there is a level playing field for UK industry and international competitors.

Before concluding, I would like to mention two further points. There was no public consultation, simply because this order does not by itself impose requirements on the public or businesses. Similarly, this order does not represent a change in policy but merely ensures that all relevant existing maritime powers for ships are also available for hovercraft in future.

In conclusion, I have highlighted the importance of this Order in Council in ensuring that hovercraft operating in the United Kingdom are subject to the same regulatory regime as ships and that the department has appropriate powers to ensure compliance with relevant safety and pollution prevention standards. I therefore beg to move.

Lord Kirkhope of Harrogate Portrait Lord Kirkhope of Harrogate (Con)
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My Lords, I shall intervene reasonably briefly on this matter and, in doing so, I declare my interest not as someone who has captained or flown a hovercraft but as a holder of a private pilot’s licence in aviation. In probing this matter, I first refer to the definition of a hovercraft, not from a maritime document but from Aviation World, which says:

“A hovercraft is a type of vehicle that is designed to travel over a variety of surfaces, including land, water, and ice, using a cushion of air. The vehicle is propelled by one or more fans, which create an air flow that lifts the hovercraft off the ground and allows it to ‘float’ on the surface”.


“One of the key features of a hovercraft is its versatility. Unlike boats, which are limited to water, and cars, which are limited to roads, a hovercraft can travel over a wide range of terrains”—


this is getting to my point—

“including mud, sand, grass, and even shallow water. This makes them ideal for rescue operations, transportation in marshy or wetland areas and for military uses”.

The Minister has rightly mentioned that, at the present time, there is very limited commercial use of hovercraft in this country. He referred to the Solent, where hovercraft are in use, but I point out to him that there is considerable and increasing use of hovercraft on the land and in the military, and their uses are always being looked at and developed. I am proud to say that this was a design patented by a UK citizen, Christopher Cockerell, in 1955. For a long time, we developed the commercial use of these craft, particularly in the channel and elsewhere. The world did not directly follow us in that way, but it then started to look at alternative uses.

I come to the points of probing that I would like to make to the Minister. First, these are inevitably maritime regulations. In fact, looking at the commercial use of hovercraft, I assume that they are always of the feminine gender, because they follow ships and boats, which tend to have that designation—it is not quite the same with the Army, which I do not think would do that. I would like a little explanation on the following. We are making maritime law apply to the use of hovercraft, yet the use of hovercraft in a maritime setting is diminishing while their use across land and other surfaces is increasing. Can the Minister help me understand how the regulations apply to hovercraft that are not on the sea or water?

Also, in relation to the issues he mentioned of pollution, casualties and safety requirements, what measures are there to protect people? What measures are there in relation to pollution in the environmental setting as they relate to these vehicles or crafts?

Finally, on insurance, it is interesting that in the maritime setting ships tend to be insured through Lloyd’s Register and tend to be insured specifically on a maritime basis. Is the insurance of hovercraft required to fit in with maritime law in this way, or is it covered in some other manner?

I hope that my short contribution has not confused anybody, but it seems to me that these narrower provisions before us today, which are drafted on a maritime basis, do not necessarily reflect the reality of the use of this wonderful invention of Christoper Cockerell.

Lord Greenway Portrait Lord Greenway (CB)
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My Lords, I thank the Minister for introducing this order, on which I have no complaint— I think it is all very sensible, but I would say that, as a mariner. Following on from what the noble Lord who has just spoken said, I shall be interested to hear what the Minister has to say about this movement of hovercraft from sea to land. The RNLI already uses small hovercraft for dealing with waters where the tide goes out a long way and there are a lot of mudflats, where they find them very useful.

However, in terms of general passenger carriage, as the Minister referred to, the service between Southsea and Ryde is in fact the last all-year-round service in the world that uses hovercraft for carrying passengers. In some ways, it is very welcome that it uses hovercraft—as we have heard, invented by Christopher Cockerell—but it is also rather sad because, in many ways, the hovercraft was a brief flash in the pan in maritime history. It developed quite considerably from small hovercraft, such as the SRN6, up to the SRN4, which was quite a large hovercraft—in fact, it was even lengthened for service across the channel from Dover to Calais.

However, hovercraft were not without their problems, and in fact there were at least two fatal accidents. One of the smaller SRN hovercraft flipped over in a gale just off Southsea and nine people were drowned. One of the larger ones, also in a gale, hit the breakwater coming into Dover, which put a 60-foot gash in its side, and a number of people fell out, four of whom, sadly, were pronounced dead.

The hovercraft was, in many ways, an interesting and wonderful invention, but I am afraid that it was overtaken, first, by the huge fuel-price hikes in the 1960s and 1970s and, then, of course, by the introduction of the Channel Tunnel, which really killed off the larger hovercraft that crossed the channel. They went out of action in the year 2000.

As I said, I have no complaints about this order, and I look forward to hearing the Minister’s reply.

Lord Moylan Portrait Lord Moylan (Con)
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My Lords, first, I congratulate the Minister on retaining his place in the recent reshuffle.

Following my noble friend Lord Kirkhope of Harrogate’s speech, which I thought was fascinating, it may be that, as a result of that speech and the points made by him and, to some extent, by the noble Lord, Lord Greenway, the Minister might now prefer to withdraw this statutory instrument on the grounds that the department has probably miscategorised hovercraft as properly falling under maritime law and come back with an instrument that acknowledges the richer context in which hovercraft are increasingly used and—if we are to believe my noble friend and the noble Lord, who have some expertise—are likely to be increasingly used, so that the statutory instrument can be pertinent, robust and what is called future-proof. If so, we would completely understand why the Minister would wish to withdraw the instrument and we would not object to its withdrawal.

16:30
The updates in the instrument are largely technical, it must be said, but there are a few points I should raise. First, on fees, we must be anxious that fees are not set at levels that are prohibitive for operators of hovercraft. I ask the Minister whether there is some limitation on fees—for example, one that requires that, taken together over a period of, say, a year, the fees do not in total exceed the costs of delivering the regulatory service for the department or the Maritime and Coastguard Agency—so that at least they cannot be used in a way that interferes excessively with the operation of any services that are proposed.
Although the Minister has said there was no public consultation and he has given a reason for that, which is that the instrument does not impose any new requirements, I wonder whether the sector—which is, of course, one company—was consulted on this question of fees. Although it is not a requirement, it is an expanded power and therefore exposes the sector potentially to a greater range of fees than exists at the moment. Perhaps he can explain whether the sector was consulted on the fees provisions and whether there was any response. If it was not consulted, again, he might prefer to consider doing so before pressing ahead with the instrument today.
The next issue is the use of ambulatory references under Section 306A. I have to confess that I had never before come across the concept of ambulatory references. I had to make some inquiries. In fact, in my original query to those whom I consulted, I was not sure whether the ambulatory power related to the hovercraft itself or to the regulations—was it the hovercraft that was ambulating about, so to speak? Apparently not; it is what we would know in a different context as dynamic alignment. It is troubling because we have got rid of dynamic alignment from the regulatory regime of this country, mercifully, but here we are apparently embracing it.
It appears that ambulatory references, or dynamic alignment, relate to the regulations made by the International Maritime Organization. The purpose of this provision is that those regulations would apply directly in UK law without further reference to Parliament or further law-making; there would be neither a statute, in primary legislation, nor a statutory instrument for those regulations to apply. I find this slightly concerning because we are in this House keen to ensure that parliamentary oversight of the making of new law and regulation should be crucial. That is something I should like to know. I think I am right in saying that this is the only example of ambulatory reference in UK regulatory law. If I am wrong about that, the Minister can tell me and I am happy to be corrected about it.
That is significant, as a matter of principle, in relation to the whole question of parliamentary scrutiny and accountability. I remind the Minister—I know that he does not need reminding of this—that parliamentary scrutiny is the Government’s friend, because it keeps everybody on their toes when they know that they are subject to questions and examination by Members of this House and the other place. The Government should not worry about parliamentary scrutiny in the slightest; it is their friend.
I think therefore that the Government have probably come at this issue—I say this especially in the light of the comments by the two preceding speakers—on a very narrow basis, possibly a flawed basis. It may be the case that, if the order is not withdrawn, it will have to be rewritten again quite soon in any event to take account of the expanded use of hovercraft away from a maritime setting. In the meantime, providing the implementation in relation to the one existing operator is proportionate and involves an appropriate level of consultation, we do not object to the Government’s intention at the moment.
Lord Hendy of Richmond Hill Portrait Lord Hendy of Richmond Hill (Lab)
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My Lords, I thank all noble Lords for their consideration of this draft order. I am grateful for the scrutiny and interest shown in ensuring our maritime legislation remains coherent and fit for purpose.

The noble Lord, Lord Kirkhope of Harrogate, spoke eloquently about the varied use of hovercraft other than in the circumstances in which they are currently principally used for marine purposes. My assurance is that these regulations cover the use of hovercraft in the sea and near the sea; the use of them on land is outside the scope of this legislation. I will write to him further about what I can tell him about the use of hovercraft on land. Of course, we have to, and should, take proper account of their use in commercial service in the remaining service within which they operate. It is important, therefore, that the regulations are up to date. The intention is to keep them up to date in order that that service can continue for as long as possible.

I note that the noble Lord, Lord Greenway, like the noble Lord, Lord Kirkhope, gave us a very clear understanding of the history of hovercraft. He referred to two serious accidents, which is, of course, the reason why these regulations should be kept up to date and that the hovercraft in service that the public are currently using are properly regulated.

We do not intend to withdraw the order, because it is necessary to ensure that we have continuous and proper regulation of hovercraft. This order is the means of doing that.

The noble Lord, Lord Moylan, asked about the fee calculation. The fees are calculated at a cost recovery level. There are no new fees or increases to fees. There would be full consultation before there were to be any new or increased fees. I believe that answers the point raised by the noble Lord.

As I said, there was no consultation because there was no material difference, but the department is in constant discussion with the operators of the remaining hovercraft service—principally, as noble Lords may know, about the controversy over the level and quality of all services to the Isle of Wight.

Lord Kirkhope of Harrogate Portrait Lord Kirkhope of Harrogate (Con)
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I am sorry to interrupt the Minister mid flow. He very kindly suggested that he would write to me. I know that the maritime regulations are narrow, as he said, in that, according to this, they cover the operation of the hovercraft only on the sea or, presumably, on water. But a lot of the hovercraft now deployed, particularly military and others, combine running on water, land, across mud and across ice. That is the whole joy of the air cushion. They do not run on roads, so we cannot talk about Road Traffic Acts or anything like that. It is of great interest to me to know how these regulations are applied, particularly in a multi-use case such as that or, indeed, where they never go near water. That is what I am puzzled about. I realise that this measure is not about that, and I do not want to spoil it like that, but if the Minister could ask officials and so on to write to me about that, I would be so grateful.

Lord Hendy of Richmond Hill Portrait Lord Hendy of Richmond Hill (Lab)
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The noble Lord raises a valued point, and I will write to him fully. The intention of this order is only to cope with their maritime use and the marginal use of the slipway at each side of the Solent. I will write to the noble Lord separately about his valuable point, because it is clear that some regulation ought to apply. But I am assured that the intention of the order is to regulate these craft in respect of their use on and absolutely near the sea, on the slipways. So I completely understand his point. I will write to him as fully as I am able about what applies in the circumstances in which those craft are used on land.

Suffice it to say that, although safety and other environmental protections are absolutely needed, the primary intention of the order is to continue to regulate hovercraft in public service—on the remaining public service in which they are used—in an up-to-date manner. The noble Lord, Lord Greenway, referred to two serious incidents over the course of the years, and I am sure that noble Lords would agree with me that it is absolutely essential that the regulations are kept in order so that, were there to be any such incident, it would be properly dealt with.

The noble Lord, Lord Moylan, raised the question of ambulatory reference. I am not able to tell him whether this applies anywhere else, but I handily have some remarks about ambulatory reference in this particular circumstance. It is a reference in domestic legislation to an international instrument that is interpreted as a reference to the international instrument as modified from time to time and not simply the version of the instrument that exists at the time that the domestic legislation is made.

The Deregulation Act 2015 gave a power, through an amendment to the Merchant Shipping Act 1995 by inserting new Section 306A, to include ambulatory references in domestic maritime legislation implementing international agreements—namely, ones not derived from the European Union. Using ambulatory references in merchant shipping legislation is a useful means of ensuring that secondary legislation gives full effect to future technical amendments to existing international maritime conventions that are adopted by the International Maritime Organization—IMO—and that the UK has already implemented. These include, but are not limited to, the International Convention for the Safety of Life at Sea of 1974 and the International Convention for the Prevention of Pollution from Ships of 1973. These conventions are regularly updated.

It is to the benefit of the UK shipping industry to have a mechanism whereby domestic shipping legislation can remain up to date with the international standards. It maintains an international level playing field and ensures that UK shipping complies with the requirements of any other International Maritime Organization member state to which that UK shipping travels.

Although ambulatory reference provision in domestic law allows future amendments to international conventions to be incorporated automatically into domestic law, the United Kingdom will nevertheless be able to continue to scrutinise and, if necessary, object to proposed changes in the international arena in the International Maritime Organization and assess their impact well before any amendment is due to come into force, which will inform decision-making.

United Kingdom industry and worker stakeholders will also be involved at the stage that the United Kingdom negotiating strategy is formulated, and they will be able to influence it. Some principal stakeholders representing industry and workers are affiliated to non-government international organisations, which have been granted consultative status at the IMO and make substantial contributions to the work of the IMO, contributing sector knowledge, insight and expertise.

If an amendment is objected to by the United Kingdom, it will come into force internationally. The Secretary of State will make amending secondary legislation to prevent that amendment coming into force domestically. An amendment that is accepted will, before coming into force in UK law, be publicised by means of a parliamentary Statement to both Houses of Parliament and the subject of guidance issued by the Maritime and Coastguard Agency.

I am sure the noble Lord, Lord Moylan, would not want the UK’s shipping industry to be burdened by the failure to comply with the IMO. I believe that the statement I made in respect of ambulatory reference deals with the necessary scrutiny, both to amendments that are objected to by the United Kingdom and to those that are accepted.

I have attempted, at least, to deal with the points raised by noble Lords this afternoon. This order is necessary to ensure that hovercraft remain subject to the same safety and pollution prevention requirements as ships, where applicable. It strengthens our maritime regulatory regime and ensures consistency across vessel types. I will write to the noble Lord on the subject that he requests further information on—I am very happy to do so. I hope that noble Lords have found this informative and that they will join me in supporting these measures.

Motion agreed.

Free-Range Poultrymeat Marketing Standards (Amendment) (England) Regulations 2025

Wednesday 10th September 2025

(1 day, 19 hours ago)

Grand Committee
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Considered in Grand Committee
16:47
Moved by
Baroness Hayman of Ullock Portrait Baroness Hayman of Ullock
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That the Grand Committee do consider the Free-Range Poultrymeat Marketing Standards (Amendment) (England) Regulations 2025.

Baroness Hayman of Ullock Portrait The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
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My Lords, these regulations were laid before this House on 1 July 2025.

Today is Back British Farming Day, and this instrument seeks to do just that: back our free-range poultry meat producers. This instrument has been laid to amend existing legislation governing poultry meat marketing standards to enable free-range poultry meat to be marketed as such for the duration of mandatory housing measures introduced during outbreaks of disease, such as avian influenza, which restrict the access of birds to open-air runs. All other criteria upon which the “free range” marketing term relies, such as stocking density, age at slaughter, feed formula and poultry house pop-holes, must continue to be met.

Outbreaks of avian influenza usually occur during the winter months, as was the case in 2021-22, 2022-23 and 2024-25, resulting in the introduction of mandatory housing measures for poultry that, in all cases, lasted longer than the 12-week labelling derogation period. This was for an additional 10 weeks in 2021-22, 11 weeks in 2022-23 and, most recently, eight weeks in 2024-25. So it will be important for the industry that this statutory instrument is in place for the upcoming winter period and beyond, in the event that we experience another avian influenza outbreak.

Currently, when free-range birds are placed under mandatory housing measures due to outbreaks of disease such as avian influenza, the poultry meat marketing standards regulations allow poultry meat to continue to be labelled as “free range” for a maximum period of 12 weeks, known as the 12-week derogation period. After this, poultry meat from those birds has to be marketed as indoor reared.

In 2024, Defra held a joint consultation on these proposed changes together with the Scottish Government. Some 79% of respondents supported the removal of the derogation. A separate consultation was conducted by the Welsh Government. The European Commission also consulted on plans to remove the 12-week derogation period from its legislation. In line with the Windsor Framework, any changes to EU legislation will also apply to Northern Ireland, when introduced.

When a mandatory housing measure is imposed on poultry producers, this is to safeguard the welfare of the birds, which must be our primary concern. However, we also recognise that the current requirement for poultry meat producers and processors to re-label free-range poultry meat once the derogation period is exceeded represents a financial burden on producers. This is primarily related to the higher operating costs that continue to be incurred to maintain their free-range system, with the additional cost of having to ensure that birds are temporarily housed indoors. This is also combined with the loss of income from the premium price that free-range products attract.

This statutory instrument will remove the 12-week derogation period so that free-range poultry meat producers and processors can market poultry meat as free range for the duration of a mandatory housing measure, however long that may last. With the European Union introducing a similar change to its legislation, the introduction of this statutory instrument will enable English free-range producers and processors to continue to operate on a level playing field commercially with producers in the European Union and Northern Ireland. As broiler chickens are generally slaughtered before reaching 12 weeks of age, the removal of this derogation will apply primarily to higher-value free-range birds with longer production cycles, such as turkeys, ducks and geese.

We are working closely with devolved Governments to align the introduction of the planned changes. A statutory instrument was laid in the Scottish Parliament on 3 September 2025 to amend its domestic regulations in relation to the removal of the 12-week derogation period. We anticipate that the Welsh Government will make an announcement shortly regarding the removal of the 12-week derogation period within their legislation.

The change to be introduced by this statutory instrument will safeguard our Great British poultry meat industry by reducing costs, continuing to ensure it is competitive against imports and by protecting the value of its products without compromising the high welfare and food safety standards expected by UK consumers and our trading partners. I beg to move.

Baroness Grender Portrait Baroness Grender (LD)
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My Lords, this is the 10th annual Back British Farming Day—a moment to celebrate our farmers and the vital contribution they make to our economy, countryside and food security. I thank the Minister for giving us the opportunity to discuss this important statutory instrument with significant implications for producers and consumers who value high food standards.

We welcome this proposal, which, after consultation, seeks to resolve a persistent challenge balancing disease protection with honest and transparent labelling. This amendment rightly removes the 12-week limit for how long poultry can be kept indoors under mandatory housing measures while retaining the free-range label. The change, as I understand it, has the greatest effect on turkey, duck and goose producers, as chickens are generally slaughtered before the time limit expires.

On this day dedicated to British farming, it is fitting to recognise the immense pressures faced by our producers, especially after the impacts of avian influenza, and the need for legislation that is fair and practical. Mass culls, supply-chain issues and uncertainty have taken their toll on our rural communities, and that is why the priority must be a regulatory system that protects producers from circumstances that are often beyond their control, without undermining their hard-won reputations, of which so many of our UK food producers can be rightly proud.

The Liberal Democrats have consistently championed high animal welfare standards. When in government, we introduced the all-out ban on caged hens. Consumers expect clarity and integrity in their food labelling, and the free-range label stands for quality, welfare and trust, and it is important that those values must not be diluted or diminished.

Support for producers should never mean weaker animal welfare or compromised consumer trust, so I urge the Minister to confirm, or respond with reassurances, that the statutory instrument will not do any of the following. First, will she confirm that it will not exclude British free-range eggs or poultry from EU markets due to regulatory divergence, risking essential exports? After the trading challenges of bad post-Brexit deals, this is a pressure that our farming communities cannot continue to bear. Secondly, will she confirm that it will not dilute the high welfare expectations associated with the “free range” label, which our producers and customers depend on?

Finally, will the Minister confirm that the statutory instrument will not lead to confusion or reduce confidence in what “free range” genuinely means—I note the examples from the polling that the Minister used in her introductory remarks—for so many of our consumers who today wish, in increasing numbers, to make ethical choices? Meeting public expectations and reflecting farm realities requires transparency. The reputation of “free range” must remain as a guarantee of higher welfare, not merely a technicality. Also, how will the Government audit compliance, ensure that labelling reflects actual living standards and work with producers and consumer groups to uphold these robust standards?

We support these regulations; we are looking at the small print, but we are very much in support of this statutory instrument when it comes to providing detailed reassurances on animal welfare and consumer confidence. On Back British Farming Day, we stand with our farmers while demanding the highest standards for animals, rural communities and our food security system. I look forward to hearing the Minister’s response.

Lord Blencathra Portrait Lord Blencathra (Con)
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My Lords, I begin by saying how delighted I am—indeed, the whole Committee will be delighted—that the noble Baroness is still in her place as a Defra Minister. We have continuity Defra, and that needs to be said.

But may I also say how sad I was to see that Daniel Zeichner has been brutally chopped? He was a good Minister doing a good job. He had been shadow Minister since 2020 and was a Minister for a year, and then was chopped for no good reason. One idiotic report in the press said that he had been chopped because of the tax on farmers. I think they got the wrong target there, since the Secretary of State’s replacement was in the Treasury, which imposed the tax. The reports said that the Secretary of State had been “promoted” away from Defra, diminishing its importance. What does Defra do? It is the only the department that looks after our food, farming, fishing and trees, and looks after the quality of our water, rivers, streams and the air we breathe. Yet the media regard that as less important than going to a department that cannot build houses unless it deals with ghastly local government.

I will not waste the Committee’s time by repeating the necessity of this SI. The Official Opposition wholeheartedly support it for the same reasons set out fully by the Minister. So long as avian influenza is a threat to all flocks in the UK, in addition to the devastation among wild birds, the only precaution is to keep poultry inside. That is unfortunate, but there is no other way.

As the Minister explained, that means that free-range poultry would be kept inside as well and lose the designation “free range” if it is kept inside for more than 12 weeks. However, that would not apply to Europe, which operates under different rules at the moment. Thus, without this SI change, English producers would find their poultry meat marketed as “indoor bred” but similar meat from Europe could be labelled “free range”. Clearly, that would be damaging to the UK poultry sector, so this is necessary to maintain a level playing field.

As the Defra Explanatory Note points out, there is very little free-range chicken meat at the moment. At this time of year, the main free-range poultry are turkeys, geese and ducks, and it would be wrong to damage our producers by labelling them “indoor bred” while letting foreign imports be classed as “free range”. For those reasons, we will support the SI.

However, I flag up the same point that I made in the debate on free-range eggs: we cannot go on like this indefinitely. For impeccable reasons, we are misleading consumers, even though I think the products need a label stating that they have been kept inside. I am not sure about that, so perhaps the Minister will clarify in her winding-up speech whether, in relation to products that have been kept inside, there is an explanation for how they comply with “free range”. I repeat that, ever since my time in the Ministry of Agriculture, Fisheries and Food in 1990, I have felt that the definition of “free range” is misleading. Yes, chickens must have access to outdoors for half their lives, but they rarely go out of the little hatch and stay inside most of the time. However, now is not the time or occasion for me to start a war with the British poultry producers.

17:00
I have one other query for the Minister, on which I realise that I neglected to tip her or her department off; perhaps she might write to me and the noble Baroness, Lady Grender, about it. I have seen reports recently that breeders of rare birds are killing their birds because of avian flu restrictions. In the poultry tent at the Appleby Show in Cumbria, I have seen chickens of all sizes and extraordinary plumage—I am sure the Minister has seen them as well at shows in west Cumbria. I can understand why rare breeders from all around the country cannot bring them together at poultry shows, but why do they need to kill them? There have been fairly long-standing restrictions, and surely the breeders would have curtailed the number of hatchlings to match supply. I assume that is why there is decreased demand.
I am happy to admit that I do not know what is happening within this sector. I look forward to some elucidation from the Minister—if not today, then perhaps in writing. I think we all agree that we need to keep a thriving rare-breeds sector, because some of them will have genes that we may need to edit in future for wider use.
With those few remarks, I repeat again that we totally support this SI, and we look forward to a happy Christmas with some good turkeys, ducks and geese for consumption—properly labelled, of course.
Baroness Hayman of Ullock Portrait Baroness Hayman of Ullock (Lab)
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I thank noble Lords who have taken part in this debate. I know it has not been a very long debate, but I thank noble Lords for their support, because this is an important instrument.

The noble Baroness, Lady Grender, asked whether or not animal welfare would be diluted by it. The answer is: absolutely not. Animal welfare legislation continues to apply even though the birds are being housed. Keepers are ultimately responsible for the welfare of their birds, but we have good legislation in this country to ensure high animal welfare standards. Guidance for all bird-keepers on biosecurity and preventing welfare impacts on poultry has been published by Defra and is available on the avian influenza pages on the Government’s website.

On the free-range criteria, the criteria on which designation of the “free range” special marketing term is granted are outlined in Article 11 and Annexe V of the poultry meat market standards regulations. In summary, for poultry to be regarded as “free range”, the stocking rate in the house and the age at slaughter have to follow detailed requirements. To take chickens for example, the stocking rate per square metre of floor space must not exceed 15 birds and a live weight of 25 kilograms or less, and the age of slaughter must be 56 days or later. Continuous daytime access must also be provided to open-air runs that are covered by certain amounts of vegetation—for example, 4 square metres per turkey or goose. During mandatory housing measures, access to the open-air runs only will be restricted; all the other free-range criteria will continue to apply.

The noble Baroness, Lady Grender, asked about enforcement. Animal and Plant Health Agency inspectors conduct risk-based and random checks on free-range poultry producers. Local authorities also conduct checks at retail level. These inspections will ensure that only free-range poultry meat is labelled as free range during mandatory housing measures. Previously, retailers have put up clear signage to explain the conditions that are being met under the new arrangements.

Regarding consumer information and consumer confidence, we issue national, local and trade press releases to make sure that the latest information is communicated through the media. We also post the latest advice, key messages and situational updates on both the Defra and APHA social media channels. Working with different industry groups, the information is then distributed through those industry group members. In addition, you can also subscribe to APHA’s free animal disease alert service for any latest information on situations in Great Britain.

On the EU, there should not be a problem. As I mentioned in my introductory speech, the EU has confirmed that it is also intending to proceed with the removal of the 12-week derogation. Once Scotland and Wales have also come into line, because Northern Ireland is impacted by EU legislation, that should mean that we are all on the same page, which would be very helpful for trade.

The noble Lord, Lord Blencathra, asked about the avian influenza aspect and the impact on birds. I am sure he is aware that the housing measures are brought in to reduce the risk that poultry and captive birds will come into contact with wild birds, because avian influenza is often passed on through wild bird populations. It is also not just about the bird itself but the wild bird faeces as well, which can also transmit the disease. Then, even when the birds are housed there is also a risk of infection, so this must be coupled with good biosecurity.

We do not want to see birds slaughtered so we are working with producers, the NFU and others on the importance of biosecurity. Good biosecurity—disinfecting clothing and equipment after use, repairing building defects such as holes in the roof, which unfortunately is often one way that wild birds can get in, and keeping good records, and so on and so forth—is one way that producers can reduce the impact. Obviously, we do not want to slaughter birds. I think we have a better understanding of avian influenza now than we did a few years ago; it is not going to go away.

It is also worth noting that, although the vaccination of poultry and captive birds against avian influenza is not currently permitted, and currently it is unlikely to provide full protection because of the kind of strains that we have at the moment, we are still looking at this issue. We are not there yet. We know that vaccination can help reduce mortality, but we are also concerned that despite that, they could still transmit the disease to other birds. So we are looking at that. There is more work happening on the longer-term view on tackling avian influenza but currently we are not there. Coming back to consumers and trading, we also know that some of our trading partners will not accept vaccination at present.

In conclusion, I thank noble Lords for their support of the need for this instrument. As I outlined in my opening speech, the introduction of the mandatory housing measure is to protect the welfare of our poultry. Removing the derogation will support industry by reducing those financial pressures and will get a level playing field with trading partners, including the European Union, as they also move in the same direction. We have to do our part to support our poultry industry. I think I have answered all the questions, but I will check Hansard just to make sure. I beg to move.

Motion agreed.

Limited Liability Partnerships (Application and Modification of Company Law) Regulations 2025

Wednesday 10th September 2025

(1 day, 19 hours ago)

Grand Committee
Read Hansard Text Read Debate Ministerial Extracts
Considered in Grand Committee
17:10
Moved by
Lord Leong Portrait Lord Leong
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That the Grand Committee do consider the Limited Liability Partnerships (Application and Modification of Company Law) Regulations 2025.

Lord Leong Portrait Lord in Waiting/Government Whip (Lord Leong) (Lab)
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My Lords, in speaking to these amendments I will also speak to the Economic Crime and Corporate Transparency Act 2023 (Consequential, Incidental and Miscellaneous Provisions) Regulations 2025 and the Register of People with Significant Control (Amendment) Regulations 2025.

These instruments form part of the Government’s secondary legislation programme to implement the Economic Crime and Corporate Transparency Act 2023, which I will refer to as the 2023 Act. The 2023 Act delivers the most significant reform to Companies House in over 180 years. It is central to the Government’s efforts to combat economic crime, improve corporate transparency and increase trust in the UK’s business environment. Since the 2023 Act, Companies House has made great progress in implementing the reforms, including removing false and misleading data. For example, from 4 March 2024 to 31 July 2025, Companies House removed something like 113,300 registered office addresses, 88,000 officer addresses and 71,000 PSC addresses.

In April this year, Companies House launched its identity verification service. Hundreds of thousands of individuals have successfully verified their identities. This is a major milestone and ensures that customers and Companies House are ready for mandatory identity verification in November this year, a central pillar of our reforms. These regulations will support the delivery of identity verification, as well as other technical reforms relating to the people with significant control—PSC—framework.

I will briefly speak to each instrument in turn. The Limited Liability Partnerships (Application and Modification of Company Law) Regulations 2025 apply many of the reforms to companies contained in the 2023 Act to limited liability partnerships, also known as LLPs. Specifically, they introduce identity verification for LLP members and PSCs, prohibit disqualified directors from acting as an LLP member, and remove the requirement for LLPs to keep their own “local” registers of members and PSCs. Extending company reforms to LLPs will align requirements across corporate entities. This will reduce opportunities for misuse by criminals and ensure that LLPs, and those doing business with LLPs, benefit from a more transparent and reliable business environment.

The Economic Crime and Corporate Transparency Act 2023 (Consequential, Incidental and Miscellaneous Provisions) Regulations 2025 is a largely technical instrument that helps to underpin the smooth implementation of key elements of the 2023 Act. It makes necessary consequential amendments to primary and secondary legislation following the removal of the requirement for companies and other entities to retain their own local registers of directors, secretaries and PSCs. Instead, there will be one central register at Companies House. This will make life easier for users of the register, as they will know that the centralised register held by Companies House is the definitive version.

The instrument also introduces provision to support the rollout of identity verification through the mandation of unique identifiers. These codes are generated for each verified individual and will be used to prove an individual’s verified identity status. Without this instrument, crucial parts of the Companies House reform package would not be able to operate as needed. This instrument ensures consistency across the legislative framework and prevents references to repealed provisions from persisting in law.

17:15
The final set of regulations before us today is the Register of People with Significant Control (Amendment) Regulations 2025. These make technical amendments to the PSC regime in the Companies Act 2006 and the Register of People with Significant Control Regulations 2016. This ensures that certain important information relating to PSCs, including “additional matters” that were previously recorded in local registers, is still reported to Companies House. This will maintain the completeness and accuracy of the PSC information on the register.
I should like to point out that the Explanatory Memorandum to this instrument contained a small error when it was initially published alongside the regulations. In paragraph 5.3, it referred to the Limited Liability Partnerships (Application and Modification of Company Law) Regulations 2025 by the wrong title. This has now been corrected.
These regulations are necessary to make the UK a safer and more transparent place to do business and I hope they will be welcomed.
Lord Sikka Portrait Lord Sikka (Lab)
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My Lords, I congratulate the Minister on retaining his position after the recent reshuffle of the Cabinet.

Despite recent reforms of Companies House, several issues remain unaddressed and the legislation in front of us does not really deal with them. I will illustrate my concerns with three pieces of empirical evidence. I can do more, but I do not have time.

The first concern is exemplified by a company called Herran Finance plc, which is company number 12370122 at Companies House. It was incorporated on 18 December 2019, with issued share capital, so its accounts claim, of £59,892,205. Its purpose is to provide financial services. This is a dormant company. It has never traded. The rudimentary accounts filed at Companies House show that it had cash in hand and at bank on 31 December of—guess what—£59,892,205. Amazingly, exactly the same amount was held a year later when the accounts for the following year were filed on 12 August 2022.

The company is engaged in banking, though it does not have the word “bank” in its name, which, as we know, is reserved for certain types of organisations. Its name does not appear on the FCA list of authorised firms. None of its directors is on the FCA list of authorised individuals. No person of significant control statement could be found at Companies House. The company’s page at Companies House noted on 10 October 2023:

“Compulsory strike-off action has been suspended”.


There has been no update since then. That is, nearly two years have elapsed.

This is a fake company that may have duped people. It actually has a website and its address is herran.co.uk, which has all the hallmarks of a scam. It describes itself as

“the 10th oldest bank in the country”

and says that deposits with it are safe because they are insured with the Federal Deposit Insurance Corporation —yes, a UK-based bank covered by US depositor protection. If anyone needed a sign of fraud, there it is. The website is an exact clone of a genuine bank.

Some five years after the incorporation of this organisation, no attempt has been made by Companies House to see that the accounts are genuine or that the company is licensed to carry out the described activities. Can the Minister explain who checks whether a fake bank has been incorporated at Companies House and how often these checks are made? Who are they reported to?

Directors of Herran provide a UK address but do not appear to live there. Companies House does not require proof of address when you first create a company. Anybody’s address can be used and, paradoxically, the injured party must provide evidence of the proof of address to correct data held at Companies House—but crooks do not have to. Can the Minister explain why no authentic proof of address is needed to register a company at Companies House?

Does the Minister agree that the filing of false information at Companies House should be a criminal offence? Why is that not already the case? What is the Government’s plan to deal with this? We have a lot of debates around immigration, but fake companies can be used to secure work visas. Can the Minister tell the House how many work visas have been secured by false companies? How do the Government know how many have been issued? Is there any check at any time? That is my first piece of evidence.

My second piece of evidence is that numerous fake banks are routinely registered at Companies House. Examples include “CITIC Limited”, “The Toronto Dominion Ltd”, “JPMorgan Chase Ltd” and “Goldman Sachs Finance Ltd”, and all these had a common director: a person named Barbarat Giuseppee, who claims to be an Italian living in France. The address given is probably non-existent, and the person probably does not exist either. The same Giuseppee currently holds seven company directorships according to Companies House. Yet nobody has bothered or cross-checked; nobody seems to be doing any job in tackling the crooks.

No amount of identity verification can confirm that a foreign national forming a UK company is genuine, as the UK does not have access to the passport or birth certificate databases of other countries. Even if a genuine foreign national is caught in illicit practices, UK law cannot be enforced on any person living in another country. Around 900,000 UK-registered companies do not have a UK director. Evidence shows that a company with only foreign directors is 17 times more likely to show signs of fraud, yet nobody has bothered to deal with this particular problem.

Genuine companies are not informed by Companies House or anybody else of the existence of fake companies abusing their name. As and when they discover this, they are left to incur legal costs out of their own pocket to fight fraudsters. Can the Minister explain why Companies House registers blatantly fake companies? Does he agree that we need a law requiring all UK-registered companies to have at least one UK citizen as a director? That way, at least we would know whom exactly to hold to account.

My third piece of evidence relates to a law firm that was shut down in October 2023. The name of the firm is Axiom Ince Ltd and it was closed by the Solicitors Regulation Authority. Some £64 million of clients’ money was missing. Unaudited accounts for the year to 31 March 2022 were filed at Companies House on 7 February 2023. They were not audited because directors claimed that the company was a small company. It was not, because it did not satisfy the requirements of the Companies Act definition.

An accountancy firm named Adrian C Mansbridge & Co. issued an accountants’ report and went along with the directors’ fiction—for a fee, of course. Subsequently, the Institute of Chartered Accountants in England and Wales fined the firm the puny sum of £2,100 and recovered the disciplinary costs of £2,200. The ICAEW keeps the fines to swell its coffers. The whole thing is a racket. Accountancy trade associations make money by licensing accountants and auditors and then profit again from their misdemeanours.

Companies House never checks accounts to see whether any of the audit exemptions claimed are appropriate. Can the Minister explain who checks to ensure that the accounting and auditing exemption requirements are not abused? He cannot say that it is up to the directors, because they are party to the wrongdoing, and he cannot say it is up to the auditors and accountants, because they are party to the wrongdoing as well.

So, currently, there is no central enforcer of company law, and the deregulatory zeal in political circles at the moment is unlikely to deliver the required transparency or freedom regarding economic crime, which is what the Minister said the legislation in front of us will deliver. I look forward to his response.

Lord Vaux of Harrowden Portrait Lord Vaux of Harrowden (CB)
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My Lords, I thank the Minister for introducing these regulations. It is good to hear from him on the progress Companies House is making in cleaning up the register and the process of verification, although, as the noble Lord, Lord Sikka, has just demonstrated so clearly, it is a work in progress.

The Register of People with Significant Control (Amendment) Regulations 2025 are fine so far as they go, but they still leave it far too easy for persons with significant control to disguise themselves and, therefore, not be disclosed on the register as they should be. We discussed this loophole at some length during the passing of what the noble Lord called the 2023 Act. It relates to the use of undisclosed nominee share- holders.

During the process of passing the Act, this House passed an amendment on Report that would have required shareholders holding 5% or more to declare whether they are holding those shares on behalf of another person. That amendment was ultimately dropped during ping-pong after a compromise was reached with the then Government that inserted into the Bill a power for the Secretary of State to regulate to strengthen the rules around nominees’ shareholdings.

A PSC has an obligation to state that they are a PSC, but a dishonest actor would not do so. The problem we have is that the onus on reporting PSCs falls to the company, and the obligations on the company under the statutory guidance are quite weak. The statutory guidance says that the company should simply scan its share register and identify any shareholders who hold 25% or more. It is easy therefore for a PSC who wishes to hide their identity to structure their holdings via a number of shareholdings below that 25% threshold. For example, five holdings at 20% would give 100% control.

All the dishonest actor has to do to hide that control is find five willing people who are prepared to have their name on the shareholder register and hold shares on behalf of the dishonest actor as nominees. There is no comeback for those nominees. They have no obligation to disclose the nominee arrangement unless the company actively asks them to, which it does not have to do if the shareholding is below 25%. So the company could quite legitimately say that it had followed the guidelines and state that it does not have a PSC because it could not see any shareholders above the 25% threshold.

A whole industry of nominee companies has grown up, as you can see if you google “nominee shareholders”. If the Minister has not done that, I urge him to take a look. Although there are perfectly reasonable uses for nominee shareholdings, it is fair to say that most of the nominee companies make it pretty clear on their websites that the primary purpose is simply to hide the beneficial ownership of the shareholding, which they will do for just £200 a year. Very few of them point out the PSC rules. Forcing those nominees to lie on the record to hide the identity of the beneficial owner would, at the very least, concentrate their minds and make it much harder for a dishonest PSC to find nominees prepared to hide their identity.

My questions for the Minister are as follows. What analysis have the Government done on this since the Act was passed? Does he recognise the issue? Is there any plan to use the powers that were inserted into the Act during ping-pong to deal with it?

Lord Sharpe of Epsom Portrait Lord Sharpe of Epsom (Con)
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My Lords, I, too, am delighted to be able to welcome the Minister back to his place. I should have done so earlier, in the Chamber, but I am very pleased to see him there. I am grateful to him for introducing these three important instruments and for so clearly setting out the Government’s rationale. For the record, I should probably declare that I have been a member of an LLP, but I am not any more. Together, these instruments continue the implementation of the Economic Crime and Corporate Transparency Act 2023, with the shared objective of enhancing transparency, reducing fraud and strengthening the integrity of the UK’s corporate environment. For the record, I should say that I agree very much with the noble Lord, Lord Vaux. It is very good to hear the progress being made with regard to Companies House. We will come back to that.

17:30
I begin with the Limited Liability Partnerships (Application and Modification of Company Law) Regulations 2025, which rightly extend key transparency and verification measures to LLPs. By bringing LLPs more closely in line with traditional company structures, especially in terms of identity verification and reporting requirements, this instrument closes off another avenue through which bad actors could exploit corporate law. The provisions that the Conservative Government made delivered great strides in introducing identity verification for directors and those with significant control in standard companies. Extending those requirements to LLPs is a logical and welcome next step. It is encouraging to see the Government now acting in the same spirit of those reforms.
One area I would like to investigate a little more is to do with clarification, particularly in the definition of what it means to be acting as a member. I am grateful to the law firm, Macfarlanes, which raised this point. It is worth quoting it at some length. It said:
“We can assume this means that the member in question cannot represent the LLP in discussions with third parties or bind it to legal commitments. What is less certain is whether the member can participate in internal management decisions (akin to a director), or even vote on fundamental matters or receive profits (akin to a shareholder)”.
I do not expect the Minister to have the answer to that to hand but I would be more than happy if he were willing to write and provide a clarification, not least because, if the law firms are questioning this, obviously that will hamper the way they are able to advise future start-ups and new LLPs that are forming—of which I hope there will be very many.
Macfarlanes raised another point about the Government’s future plans with regard to LLP members who are not individuals but legal entities. Again, I would be grateful to hear whether the Government have any plans to do anything on that subject any time soon. Once again, I apologise for springing that on the Minister.
I would welcome guidance for LLPs, particularly smaller partnerships, on navigating these new requirements. Although the measures are important, we have to bear in mind that they place additional compliance burdens on already busy enterprises, which is why it is so important that their advisers are as well informed as they can be.
I turn to the register of people regulations. This SI ensures that information relating to an important person with significant control continues to reach Companies House under the new regime. As I said earlier, I am grateful to the noble Lord, Lord Vaux, for asking a number of the questions that I would have asked, so I will not bother to repeat them. The SI streamlines the reporting process by shifting from local registers to a centralised model, and it reduces administrative duplication while improving the accessibility and timeliness of data, which is very welcome. It is clear that transparency of ownership and control is essential to maintaining the UK’s reputation as a safe and trusted place to do business, as the Minister pointed out. We on these Benches believe that the reforms to this regime, first introduced in 2016, are being enhanced and future-proofed by this instrument.
Finally, the Economic Crime and Corporate Transparency Act 2023 regulations introduce necessary technical changes to ensure that the wider regime operates effectively. We are quite content with them; I will not rehearse all the various provisions, but I would be grateful if the Minister committed to keeping the House as informed as possible on the progress being made. We live in an increasingly challenging economic climate, and trust in business is vital. A robust and transparent corporate framework is not just an anti-fraud tool but a foundation for growth. When businesses know that the playing field is level and bad actors cannot hide behind shell companies, entities or anonymity, the market system can function more efficiently. The noble Lord, Lord Sikka, went into that in forensic detail, and I am sure that the Minister will answer in equally forensic detail.
We on these Benches support these measures and hope that the Minister will provide the further clarification that I have asked for, particularly around the definitions and the practical guidance for small businesses navigating these various measures.
Lord Leong Portrait Lord Leong (Lab)
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My Lords, I thank all noble Lords who contributed to this short debate: my noble friend Lord Sikka, and the noble Lords, Lord Vaux and Lord Sharpe. These regulations are another step in the delivery of the Companies House reform programme and are critical in ensuring that it operates effectively. So I really do thank all noble Lords for their questions. I will respond to as many as possible and I will check Hansard to see whether I have answered all of them. If I have not, I will obviously write to noble Lords.

I will address my noble friend Lord Sikka’s forensic look at fake banks, late filing offences and all that. I will try to answer as many of his questions as possible. Regarding fake banks and fake filing offences, Companies House has new powers to query and remove false information. As I said earlier, from March 2024 to June 2025 it prevented some 14,000 suspicious filings. The regulation of banks is for the Financial Conduct Authority, as the noble Lord knows. Companies House has implemented checks on incorporation to prevent companies forming where they do not have regulatory approval to operate as a bank. It continues to work with the FCA on this issue. The filing of false information with Companies House is a serious criminal offence, and those who have done so will have the full weight of the law thrown at them. There is a basic offence of filing without reasonable excuse and an aggravated offence of filing knowingly, so it is a very serious thing.

My noble friend Lord Sikka asked about overseas persons and whether there are any identification checks. Companies House will be able to perform robust ID checks on overseas individuals via the Government’s One Login system, which is now operating. If noble Lords have not had a chance to look at it, I encourage them to do so. Before I was in government, I personally managed to get a One Login set up—it is very easy to register and does not take more than 10 minutes to verify yourself.

If an individual cannot verify their identity, they will not be able to incorporate a company or act as a director. Existing companies will be unable to file a confirmation statement, and this will lead to a strike-off. From November, all filings will have to have verification, and this will be rolled out over the next few months to ensure that, for every single confirmation filing, the people filing it will be verified. They can either do it themselves or they can do it via the ACSP.

I thank the noble Lord, Lord Vaux, for his question and his contribution, during the passage of the Act, on nominee shareholders. I will go through our position as far as they are concerned. The Government are aware of the misuse of nominee arrangements, including to avoid disclosure under the people with significant control regime. Work is ongoing with stakeholders to determine the scale of this issue, and the ECCTA provides the power to make regulations to enable a company to find out who its PSCs are in cases where shares are held by a nominee. The Government are wary of imposing disproportionate burdens on legitimate businesses and investors. So, before making any regulations, it is right that the Government work with relevant stakeholders to ensure that burdens can be targeted effectively. In the meantime, the Companies House intelligence hub will use data science to identify threats of economic crime on the register, including the threat posed by agents facilitating the criminal activity of others. Companies House will make this intelligence available to partners such as law enforcement and supervisory bodies.

In 2024-25, the average number of shareholders per company was something like 2.1 shareholders per company, and the average number of PSCs per company is something close to about 1.2, so it is actually quite small. But we still need to get to the bottom of this to see how widely it is misused. This is in line with expectations as the vast majority of companies are law-abiding SMEs.

My officials have been in touch with other countries to learn from their experience in the nominee shareholders’ space. Among others, this includes Singapore. In Singapore, companies are required to keep a register of their nominee shareholders containing the particulars of all their nominators. My officials will continue this engagement as they work better to understand the scale of the issue, as I said earlier, and the cost and benefits of the new nominee shareholders requirement. It is important to this Government that any reforms are proportionate and workable.

On the point made by the noble Lord, Lord Sharpe, about acting as a member of an LLP, the offence of acting as a member without being verified is explicitly defined. If one individual performs the functions of a member—that is, a director—or actions that relate to the running of an LLP, they are likely to be acting as a member. So IDV will apply to both members who subscribed their names to incorporation documents equivalent to the director of a limited company and ordinary members with lesser responsibilities, usually set out in LLP’s own members’ agreement. Obviously I will speak to officials, and if my answer to the noble Lord’s question is still not detailed, I will ensure that a letter will be sent to him.

On the point about limited partnerships, which I think the noble Lord asked about, Companies House is currently looking at it. Correct me if I am wrong, but I think there are something like 60,000 limited partnerships on record, and Companies House is trying to clean this up to see how many of these limited partnerships are still active. So, over the next few months, it will clean it up, and those that have not filed confirmation statements and all that will be written off. We recognise that there is a need for limited partnerships in respect of investment trusts, private equity, and so on, so we need to ensure that they are properly regulated as well.

Regarding identity and corporate LLP members, the Government will be reviewing which individuals will be required to identify where a position is held by a corporate entity and not an individual. So we are working on that, and I hope we will be able to inform the House when it is done.

I want to conclude by reminding Peers of the importance of these reforms. These regulations are necessary to make the UK a safer and more transparent place to do business. I commend these measures to the House.

Motion agreed.

Economic Crime and Corporate Transparency Act 2023 (Consequential, Incidental and Miscellaneous Provisions) Regulations 2025

Wednesday 10th September 2025

(1 day, 19 hours ago)

Grand Committee
Read Hansard Text
Considered in Grand Committee
17:43
Moved by
Lord Leong Portrait Lord Leong
- Hansard - - - Excerpts

That the Grand Committee do consider the Economic Crime and Corporate Transparency Act 2023 (Consequential, Incidental and Miscellaneous Provisions) Regulations 2025.

Motion agreed.

Register of People with Significant Control (Amendment) Regulations 2025

Wednesday 10th September 2025

(1 day, 19 hours ago)

Grand Committee
Read Hansard Text
Considered in Grand Committee
17:43
Moved by
Lord Leong Portrait Lord Leong
- Hansard - - - Excerpts

That the Grand Committee do consider the Register of People with Significant Control (Amendment) Regulations 2025.

Motion agreed.

Hazards in Social Housing (Prescribed Requirements) (England) Regulations 2025

Wednesday 10th September 2025

(1 day, 19 hours ago)

Grand Committee
Read Hansard Text Read Debate Ministerial Extracts
Considered in Grand Committee
17:45
Moved by
Baroness Taylor of Stevenage Portrait Baroness Taylor of Stevenage
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That the Grand Committee do consider the Hazards in Social Housing (Prescribed Requirements) (England) Regulations 2025.

Relevant document: 31st Report from the Secondary Legislation Scrutiny Committee

Baroness Taylor of Stevenage Portrait The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
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My Lords, before I begin on the instrument, I need to declare an interest for this piece of business. My daughter works for Settle housing association.

I pay tribute to the work of the noble Baroness, Lady Scott, on this issue. I know she cared about it as much as I do and worked very hard in the department when she was there to make sure that this piece of work came forward. I would like to express my thanks to her for that.

In speaking to the Hazards in Social Housing (Prescribed Requirements) (England) Regulations 2025, known as Awaab’s law, I will also speak to the Electrical Safety Standards in the Private Rented Sector (England) (Amendment) (Extension to the Social Rented Sector) Regulations 2025. The Government are clear that homes must be safe. We are determined to drive a transformational and lasting change in the quality of social housing, making sure that tenants feel safe and that landlords have clarity on requirements. These regulations are an important step.

I begin with Awaab’s law. Awaab Ishak was just two when he died in December 2020 due to prolonged mould exposure in his family home. Awaab’s death was tragic. There is nothing more painful than losing a child. How much more pain his parents must have knowing that, if they had been listened to and their social landlord had acted responsibly, their son’s death could have been avoided. Awaab’s parents repeatedly raised concerns, and their social landlord failed to act. His parents have campaigned tirelessly since then, and I want to thank them sincerely. Awaab’s law will make sure that tenants’ complaints are taken seriously and that landlords respond in a timely manner with empathy, dignity and respect. It is my sincere hope that it will build trust between landlords and tenants. For too long, tenants’ complaints about damp and mould have been treated at best with delay and failure to act and, at worst, by pushing the blame back at tenants, often using the term “lifestyle issues”—a term I banned at my council. We must do better.

The regulations imply terms into tenancy agreements requiring social landlords to investigate and remedy significant damp and mould and emergency hazards within set timeframes. Significant hazards must be investigated within 10 working days, with written summaries sent to tenants in three days and action taken in five. Emergency hazards must be made safe within 24 hours. If these timescales cannot be met, landlords must provide suitable alternative accommodation until it is safe to return. Additional works to prevent hazards from recurring must begin as quickly as possible, with a 12-week backstop from investigation, and completed within a reasonable timeframe. Once the regulations are in force, landlords must comply, and tenants can take legal action for breach of contract if they do not. The regulations take into account genuine uncontrollable circumstances preventing compliance or if landlords can prove they used all reasonable endeavours to comply with requirements.

These initial regulations focus on damp and mould, emergency hazards. I will return in 2026 and 2027 with further regulations to extend the law to additional hazards. This allows us to act now, tackling the 7% of socially rented homes in England suffering from damp while testing this first phase with tenants and landlords to make sure we get things right before moving to subsequent phases. This phased approach does not reduce landlords’ existing duties to ensure that their properties are free from dangerous hazards. We will monitor and evaluate the effectiveness and impact of Awaab’s law, adding future phases to deliver the best outcomes.

I now move on to the Electrical Safety Standards in the Private Rented Sector (England) (Amendment) (Extension to the Social Rented Sector) Regulations 2025. Private landlords are already required to check the electrics in their properties. We must now ensure that social housing tenants have the same protections.

Electrical faults in homes can be extremely dangerous. This reform will mean that tenants will know their electrics are safe. It will drive up standards and reduce deaths and injuries caused by electrical faults. The new requirements will come into force for new tenancies in November and for existing tenancies next year. All landlords will have to test the electrical installations in their properties at least every five years, to make sure that safety standards are met and repairs carried out. The regulations also go further, requiring landlords to check electrical equipment they provide. Local councils will have the power to require remedial works, if necessary, and can arrange the works themselves if action is not taken by the landlord. Additionally, these regulations raise the maximum financial penalty to £40,000 for landlords, private or social, who do not comply.

I wish to draw the attention of the Committee to the fact that a correction slip has been issued for this statutory instrument. Regulation 11 stated that it inserts a Regulation 12B in the 2020 regulations. It should read “12A”.

To summarise, these new requirements are not an additional burden to the many landlords we know already take a proactive approach to keeping homes safe. Clear standards and requirements of social landlords, and timelines to meet them, eliminate uncertainty for everyone and help make sure that tenants can live in the safe homes they deserve.

Both these sets of regulations have received consistent support from across the House and the sector. I am confident that I bring robust regulations to the House, strengthened by consultation. Subject to the approval of Parliament, Awaab’s law is due to come into effect from October this year and electrical safety requirements for social tenancies from November. I commend these draft regulations to the Committee.

Baroness Whitaker Portrait Baroness Whitaker (Lab)
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My Lords, these are excellent regulations, sorely needed, and I commend our Government for bringing them forward. There is one problem that concerns me. They do not cover all social renters and, therefore, there is an element of discrimination. I should declare an interest as an officeholder in various Gypsy and Traveller organisations, so my noble friend the Minister will not be surprised at what I am about to say. Indeed, I asked her a Question about this very thing because Gypsies and Travellers are not covered. Although they rent their houses from social landlords, their houses are, in fact, caravans—permanent caravans—and they have amenity blocks on the sites for the use of water.

The problem is that the law does not correspond to reality. So, as I said, Gypsies and Travellers have their homes rented from social landlords on caravan sites with amenity blocks for the use of water. But my noble friend answered on 14 July:

“As caravans are not buildings according to the definitions set out in the Landlord and Tenant Act 1985 or the Housing Act 2004, it is the government’s position that Awaab’s Law will not extend to Gypsies and Travellers living permanently in caravans on sites with amenity blocks that are rented from social landlords”.


Usually, local authority-owned sites may be reasonably maintained. The problem there is that there are simply not enough of them. In other social landlords’ sites, the standards are simply so low as to affect health, safety and well-being.

There are different ways of framing laws so that they relate to what actually is the case. I submit that that is what the law ought to be doing. I think it is our job here in your Lordships’ House to ensure that laws fit the circumstances and values that now obtain, rather than outmoded concepts. To continue to let the law express these outmoded and unjust ideas would amount, I think, to a dereliction of our task. So I hope my noble friend can come up with some way to include these citizens who have fewer rights than other citizens.

Baroness Pinnock Portrait Baroness Pinnock (LD)
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My Lords, I thank the Minister for bringing forward these important regulations in Grand Committee. The first concern I have is that the tragic death of Awaab occurred at the end of 2020. It then took nearly three years for the law in his name to be passed, and another two years to introduce the regulations that put the Act into effect. I get dismayed sometimes at the length of time it takes to make changes when the initial reaction is that this is a situation that requires urgent emergency attention.

I am not pointing the finger of blame at anybody; sometimes it is everybody’s and nobody’s responsibility. But if the Minister could explain why it has taken so long, it would help me to understand why we are just getting the regulations now, two years on. But I am pleased that they will be enacted next month, as I think she said.

One of the concerns I have about the regulations is the tenant’s recourse when action is not taken. They complain and say, “You’ve got to get something done”, but nothing gets done. In my experience as a councillor dealing with lots of social housing, the issue is often that tenants for whom English is perhaps not their main language, or who have moved around a lot and do not know the ins and outs of how things should work, miss out when it comes to issues such as this. Which is, of course, what happened in the tragic incident with Awaab in the first place—talking but not being heard. Again, I wonder whether the Minister could just try to close that circle for me and say that there will be somebody who will say, “If you make a complaint, we’re going to make sure something happens”.

The last point I make about these regulations is that they have come about because either current or former local authority housing—the better-quality housing—has gone under right to buy. Consequently, when councils are fulfilling their duty to house homeless families, often what is left is poor-quality housing. There is an awful circle of deprivation that we cannot seem to break out of—I know that this is an attempt to do so—where homeless families go into the poorest quality housing. Often, they are families who will have to move again and again, where English is not their first language, or they may have learning difficulties. When they try to complain, nobody listens, because they do not have the clout that others have. And so it goes on. I know that this is an attempt to break that cycle; we just need to do a bit more. But I am pleased it is coming.

I turn to the second SI, on electrical safety. Of course, it was a faulty fridge that caused the fire in Grenfell Tower. That is not covered by this, but I hope that, as with statutory gas inspections of social housing, this will encourage tenants to understand that electrical safety is as important as gas safety—that it will raise understanding a bit if they get a knock on the door to check whether the electrical equipment put in by their landlord is safe. It is interesting, if I am right, that private landlords have to test other electrical equipment in their homes; PAT testing of major electrical items seems to happen.

With those comments, I think these are two good sets of regulations, but I worry about the timeliness.

18:00
Baroness Scott of Bybrook Portrait Baroness Scott of Bybrook (Con)
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My Lords, I declare my interest as vice-president of the Local Government Association. I thank the Minister for introducing these statutory instruments.

The first of these instruments follows the tragic death of two year-old Awaab Ishak in 2020, a deeply distressing case with which I am all too familiar. My heart goes out to his family, who have been fighting this case for almost five years. Awaab lost his life due to prolonged exposure to mould in his family’s social housing. Awaab’s family and parents did all they could to get the local social housing provider to deal with the problems, to no avail. His death serves as a stark and painful reminder of the devastating consequences that follow when serious hazards in social housing are unaddressed.

This statutory instrument seeks to implement part of Awaab’s law, introduced under the previous Government through the Social Housing (Regulation) Act 2023. It sets time-bound legal duties on landlords to investigate hazards, communicate with tenants in writing and resolve issues within set deadlines.

This is a welcome legal framework, but it begs serious questions. Most urgently, why has it taken so long? When we were in government, our intention was to act, and we were planning to bring in these protections by autumn 2024, following the consultation. At that time, we were already in dialogue with people in the social housing sector, many of whom had proactively begun updating their internal procedures to reflect the law’s requirements. Indeed, in my experience, housing associations and local authorities were already taking steps to improve how they handled damp and mould complaints, introducing clear communication strategies and triaging cases based on vulnerability and risk.

I ask the Minister directly: why has it taken until September 2025 for this instrument to be brought forward, when the tragedy that prompted it occurred in 2020 and the consultation concluded earlier this year? Why have the Government allowed yet another winter to pass without these protections being fully operational?

On 22 October 2024, I pressed the Minister on that exact point. I asked, quite reasonably, when they would introduce the secondary legislation, and I was told by the Minister at the time that regulations would be laid in autumn 2024. Yet here we are, nearly a year later, and the family of Awaab Ishak are still waiting.

My concerns are further compounded by the phased implementation timetable, which delays until 2027 the application of some of these protections to other serious hazards such as excessive cold, heat, fire and poor hygiene. Why must we wait until 2027? Are we really prepared to accept that vulnerable children will spend the next two winters in dangerous houses, exposed to hazards that the Government already recognise as life-threatening?

Again I ask the Minister: why have the Government chosen to delay full implementation by nearly two years, when the sector has already had time to prepare and families cannot afford to wait? I note that, in last year’s exchange, the Minister said that

“we want to get this done as fast as possible. No one should ever have to lose a child because of the condition of their home”.—[Official Report, 22/10/24; col. 511.]

Those were strong and welcome words. But actions matter more than rhetoric, and I respectfully must say that this timeline does not reflect that urgency.

My last question for the Minister on this instrument is: how will the Government ensure that social landlords will communicate these changes to their tenants? If tenants do not know, tenants cannot do anything about it.

Turning to the second instrument before us, on the extension of electrical safety standards to the social rented sector, this too is welcome. It brings social housing in line with the regulations that have applied in the private rented sector since 2020. It requires all landlords, private and social, to carry out electrical inspections at least every five years, issue safety reports to tenants and complete remedial works within 28 days. The inclusion of electrical equipment through in-service testing, formally known as PAT, is particularly welcome and an important step.

However, I must again return to the timeline. The Charter for Social Housing Residents, published in 2020, promised action. A working group was formed and a consultation was launched in 2022, but only now, three years later, do we see regulations laid. I look to the Minister for justification on this.

In closing, I want to reiterate that this is not a question of politics; it is a matter of justice, of decency and of delivering a promise made not just to the Ishak family but to all tenants who have been suffering in silence. I commend the intent behind these regulations, but I honestly urge the Government to show the urgency that this situation demands. I look forward to the Minister’s response.

Baroness Taylor of Stevenage Portrait Baroness Taylor of Stevenage (Lab)
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My Lords, I thank all noble Baronesses for their thoughtful contributions today, and I again express my gratitude to Awaab’s family for their tireless campaigning in reaching this point, as well as to the organisations and campaigners that have supported them.

I am very pleased to note the general support for the intention of these two sets of regulations and our work to improve the quality of all housing, but I will respond to the important points that have been made by noble Baronesses.

To start with my noble friend Lady Whitaker’s comments, I expect she knows the answer that I am going to give her, but that does not mean that I care any less than I have when I have had meetings with her. I pay tribute to her constant advocacy for the Gypsy and Traveller community. It is very lucky to have such an eloquent champion, and it has been a pleasure to speak to her and discuss the issues with her.

As my noble friend said in her speech, caravans are not buildings according to the definitions set out in the Landlord and Tenant Act 1985 or the Housing Act 2004, and it is the Government’s position that Awaab’s law will not extend to Gypsies and Travellers living permanently in caravans on sites with amenity blocks that are rented from social landlords. We expect local councils to ensure that amenity blocks provided on local authority-managed sites are safe and healthy. But I want to continue to engage with my noble friend, and with the groups that I know she is very connected with, on the issues affecting those in non-traditional tenures. I hope that she will be happy to do that, because I want to move this on from where we are at the moment.

There was the quite justified challenge on why this has taken so long. The noble Baronesses, Lady Pinnock and Lady Scott, both challenged on that. I have had just about a year on this, but it has been in the pipeline for much longer than that. Of course, we wanted to get these changes absolutely right. We have taken time to closely consult and engage directly with social housing landlords and social tenants. It is critical that the requirements we set in legislation are effective and deliver the best long-term outcomes for social housing tenants.

Following the coroner’s report, the Government published comprehensive guidance on the health impacts of damp and mould in September 2023, when the noble Baroness, Lady Scott, was the Minister. Awaab’s law will come into force for emergency hazards, damp and mould on 27 October, and we will bring forward further legislation to address other significant hazards in 2026 and 2027. I understand the frustrations about those dates, but it is important that we get these instruments right, so that we can see what the impact is and do not have to come back to the subject.

This Government are committed to driving better outcomes for tenants and ensuring that people can be proud to live in social housing. I want to do as much as we can to reduce the stigma that some social housing tenants feel as well.

Introducing these requirements in a phased way allows us to test with tenants and landlords how phase 1 is working before we move on to phases 2 and 3. This will help us to get this right and deliver legislation that will have a lasting legacy for social tenants. We are clear that Awaab’s law will apply to a wider set of hazards over time, to protect tenants regardless of the cause. There is no excuse for social landlords to ignore hazards while we are in the process of phasing in these requirements. They must continue to meet their duties to keep their homes fit for human habitation and free of category 1 hazards and to remedy disrepair.

Social landlords must also ensure that their homes meet the decent homes standard. It is critical that they take action against any issues in their homes as soon as possible to guarantee the safety and comfort of their residents. Not only do I take this very seriously but so does the social housing regulator, which comes within my area of responsibility in the department. We are not saying, “You don’t need to worry about this until 2026 and 2027”; we want action to be taken immediately, and we will work on the legislation in the meantime.

In response to the comments by the noble Baroness, Lady Scott, about protections before Awaab’s law is fully rolled out, as I said, it is critical that landlords take action on any issues in their homes as soon as possible to guarantee the safety and comfort of their residents. Awaab’s law establishes timeframes for social landlords to act and, once in force, will be enforceable through the courts. But social landlords are already required to keep their social homes fit for human habitation and free of category 1 hazards and to remedy disrepair. Social landlords should be preparing for phase 1 of Awaab’s law—I know that many of them are; I talk to them regularly and they have been working on this for some time—and laying the groundwork for phase 2. They must not compromise on meeting their existing obligations in the meantime. Social landlords must also ensure that their homes meet the decent homes standard.

The noble Baroness also raised the issue of communication with tenants. It is important, once this instrument has passed, that we write to all social landlords, stressing the importance of communicating to their tenants what these changes mean for them. I will take that on board and write to social landlords myself to tell them what the impacts of the instrument are.

The noble Baroness, Lady Pinnock, rightly raised the issue of the responsibility on social tenants to raise issues with their landlords. One of the things I did when I first took responsibility for the social housing regulator was to talk to it about how it looks at tenant engagement. It is really critical. Last week or the week before, I had a meeting with a tenant’s voice organisation to work on how we might have a national voice for tenants. Every individual landlord must have the appropriate channels through which their tenants can communicate with them. If social landlords fail to fulfil their legal duties, it is important that tenants have a legal route to make things right.

Seeking redress through the courts is not the only way in which residents can challenge their landlords for breaches of Awaab’s law, and I realise that that might be something of an intimidating process for social tenants. Residents can complain to their landlord and then to the Housing Ombudsman if they are unhappy with the outcome. The ombudsman is a free service and has the power to order landlords to undertake repairs and pay compensation to the tenant. Legal aid is available for housing disrepair claims when there is a serious risk of illness or injury, subject to a financial means and merits test. I should also comment—all three of us have been councillors—that for any social tenant who is concerned about their housing conditions, their councillors are also there to support them and are able to direct them to the right source in order to complain about the condition of their housing.

The noble Baroness, Lady Pinnock, also raised the issue about the quantum of social housing. She will know that the Government have already taken steps to address the right to buy and we are consulting on further steps this year. She will have heard me say previously that I was pleased about the allocation in the spring of £39 billion to improve the quantum of social and affordable housing. That comes on top of the £800 million that we have already allocated for in-year provision of social and affordable housing. We will be publishing the prospectus for bids for social housing in the near future. It is not going to solve the problem overnight but it will at least make a start on delivering some more social housing.

The noble Baroness, Lady Pinnock, also raised the issue of PAT testing—I understand that engineers are not keen on that term now, but I will use it because I think everyone knows what it means. Sadly, in the case of Grenfell, a fridge caused the issues. Social landlords are much more likely to own large multi-occupied buildings such as tower blocks and must test any electrical appliances that they provide as part of a tenancy. Private landlords are recommended to regularly carry out appliance testing on any electrical appliance they provide and then supply the tenant with a record of any electrical inspections carried out as good practice. Landlords may also consider registering products with a registration scheme but this is a complicated issue because, for most social landlords, properties are rented unfurnished. But there are some circumstances—supported housing, for example, and some types of Housing First-type accommodation for the homeless—where electrical equipment may be provided as part of the tenancy. So it is important that we provide an approach that allows for all those circumstances.

I will look at Hansard and make sure I have not missed any of the questions that I have been asked.

To conclude, Awaab’s law puts in place clear protections for tenants by making sure that dangerous damp, mould and emergency hazards are addressed quickly, and the draft electrical safety regulations will ensure that all landlords have to meet robust standards of electrical safety so that tenants can feel safe in their homes. These regulations are part of the Government’s wider quality reform package, which will ensure that every social housing resident has access to the safe and decent homes that they deserve. I thank all noble Lords who have participated in this work over all the years in which it has been going on.

Motion agreed.

Electrical Safety Standards in the Private Rented Sector (England) (Amendment) (Extension to the Social Rented Sector) Regulations 2025

Wednesday 10th September 2025

(1 day, 19 hours ago)

Grand Committee
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Considered in Grand Committee
18:18
Moved by
Baroness Taylor of Stevenage Portrait Baroness Taylor of Stevenage
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That the Grand Committee do consider the Electrical Safety Standards in the Private Rented Sector (England) (Amendment) (Extension to the Social Rented Sector) Regulations 2025.

Motion agreed.
Committee adjourned at 6.18 pm.