Michael Garson provides a timeline of recent developments gives his assessment of where things stand this month.
Michael Garson is the author of “Home Information Packs – A Guide to the New Law” published by the Law Society.
Fresh developments summary
May
22/23: RICS statement on court order and other releases from OFT and CML
22: Government Minister’s statement postponing HIPs
16: RICS application for judicial review.
Assessment
Latest first: Will it be third time lucky with the HIP Regulations? Ruth Kelly’s announcement on HIPS on 22 May to postponing HIPs to 1 August sounded like a death knell to the pack.
Press releases issued by the main players in the property industry uttered a collective sigh of relief. AHIPP on the other hand continued to toe the government line and bemoaned the setback to a brave new world for buyers, sellers and energy efficiency.
The worrying question that affects confidence is why did the government go to the wire on this when they must have known that the target number for DEA’s was never going to be met by 1 June?
The interim order made on the RICS application for judicial review has evoked differing responses from the parties.
The government, according to Ruth Kelly’s statement in the Commons (and the corresponding one in the Lords), believes it has ‘bought off’ the legal action of RICS by postponing HIPs to 1 August, restricting its impact to homes with four or more bedrooms and allowing marketing to begin once a home information pack has been commissioned - rather than having to wait for it to be completed. In addition the age requirement of the EPC has been extended from three months to twelve months.
The press release from the RICS tells a different story. They state that their action has been stayed (put on hold) on terms requiring:A 12-week consultation period on the regulations dealing with EPC’s;
The government to publish a regulatory impact assessment including a full cost-benefit analysis; and
Payment of the RICS’ legal costs. Like other property professionals the RICS supports the EPC but they argue that it must be made to be a workable initiative.
The government climb down lances the boil that has been growing ever since the 25 January statement. Issuing new Regulations on 29 March on both HIPs and EPCs and expecting the industry to be ready to go on 1 June now appears irresponsible and damaging to the future credibility of future reform proposals.
However the saga is continuing. Ruth Kelly announced a postponement of the introduction of HIPs to 1 August and promises revised regulations. Let’s hope she realises the EPC regulations need amendment too as otherwise regulations 5, 6 and 11 will continue to cause problems.
Can these new regulations be delivered in time? Parliamentary procedure requires 40 days to elapse between the day a Statutory Instrument is laid and the date it comes into force. Parliament rises for the summer recess on 26 July meaning that the new regulations must be laid by 16 June for the 40 sitting days to have elapsed by 1 August.
Debate in both houses raised questions over the definition of four-bedroom houses and the House of Lords debate which did not proceed to a vote made it clear that parliament expects to be given the opportunity to review the results of the dry run before moving on down the current path.
© Michael Garson
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