Home Information Packs (HIPs) are suspended and pickled

Eric Pickles has finally granted Mr Shapps’s long held desire to suspend HIPs this morning, though it remains unclear on what basis. Grant Shapps who has increasing appeared to be on personal crusade to scrap HIPs has seemingly suceeded and issued a statement shortly afterwards.

The statement read,

“Mr Pickles today laid an Order suspending HIPs with immediate effect, pending primary legislation for a permanent abolition. The Secretary of State has taken this swift action in order to avoid uncertainty and prevent a slump in an already fragile housing market. Today’s announcement sends a clear message of encouragement to people thinking of selling their home that they can put it on the market with less cost and hassle.”

The statement (which can be read in full here) fails to clarify the justification of such an immediate action and the basis the decision was made upon. Furthermore, many would argue that it goes against an official statement we were given direct from Grant Shapps office, where he stated a consultation would be actioned.

“If we win the next election, we will scrap HIPs as soon as possible after a consultation period – we expect to be around 100 days.”

Colin Smithson-Connelly chairman of IPPA today stated,

“Grant Shapps was advised in opposition of the jobs losses expected which will be anything up to 10000 and over from HIPs related Industries and while that is not the reason to protect something if it is definately causing problems in the market.

However, our research is showing that this isn’t the case and many agents either don’t want to see HIPs abolished or are neutral and would rather not see 1000’s of people lose their jobs over a political decision. Grant Shapps was also advised that the abolishment of the HIPs regulations had to be handled carefully to not destabilise the fragile housing market.”

It is quite understandable that those in the industry consider that scant regard has been given to their businesses and their clients and have been left feeling bewildered and perplexed. It is unclear of the full extent of the redundancies that will follow; and when or if the Conservative / Liberal Democrat government will propose a HIP alternative or actually return us to the days of increased levels of delayed and aborted transactions.

Eric Pickles expressed the need to suspend HIPs during an interview on the Politics show today. Eric Pickles detailed how they became concerned about rumours which were circulating in the industry which he claimed were de-stabilising the market and also felt that suspension would halt the possibility of a slump in the market.

We understand that Eric Pickles has used the following section of the regulations as his basis to suspend HIPs, (the full regulations can be read here.)

Section 162: Suspension of duties under sections 155 to 159

353.     This section allows the Secretary of State by order to suspend any duty imposed by sections 155, 156, 158 and 159. Such a suspension may be time limited or indefinite and in either case can be revived. This power will only be used in exceptional circumstances.

We would certainly question whether the circumstances he has described so far are ‘exceptional’ and it is likely that this definition would need to be decided by the courts of the land.

It is ironic that anti-HIP statements that were seemingly emanating from the ‘usual’ anti HIP camps; which it is believed are being referred to as the de-stabilising factor are being used as ‘supporting evidence’ to suspend Home Information Packs (HIPS) by the Conservatives.

We specifically brought the issue to light and to the attention of the Conservatives in article the article ‘Conservative Home Information Pack policy to stall property market?’. This was also referred to in a recent Office of Fair Trading (OFT) report, (OFT report Home buying and selling – A market study) published in February this year which we would have hoped those trumpeting the suspension of HIPs may of taken the time to read. It concludes,

it could be argued that HIPs in their current form have a positive impact’ and ‘We do not, therefore, recommend any intervention on this issue at the present time.’

So the OFT, no less, would seemingly not support suspension via this clause in the Act.

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During the interview with Eric Pickles, unfortunately no discussion or disclosure took place on what evidence formed the basis to take such drastic action which will directly affected thousands of jobs. One would hope that it was not purely a ‘political whim’ of Grant Shapps and Eric Pickles, supported by the popular TV presenter Kirsty Allsopp who we are more recently accustomed to seeing glassblowing or making decorative cushion covers, than offering advice on housing reform.

It has not been widely reported or acknowledged by many but the Energy Performance Certificate’s (which had to be retained as per the EU legislation) importance has been downgraded during the home information pack suspension and was a concern we detailed in ‘Grant Shapps to change Energy Performance Certificates (EPC) delivery?

The EPC now only needs to have been commissioned before marketing can commence and will now be valid for 10 years for sales purposes. This was feared by many interested in energy efficiency and environmental sustainability.

It seems as if it is the end of the HIP era though wonder if the Home Information Pack may return to haunt Grant Shapps and Eric Pickles (who was hastily put forward to deal with the issue) in the future when they attempt some constructive housing reform.

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