Thanks to the Rat and Mouse's special correspondent for hipping me to the latest on HIPs - which makes for some painful reading. Here's Yvette Cooper:

As part of the development of the dry run we have engaged in detailed consultation with a wide range of stakeholders and have gathered substantial information on the progress of implementation so far. As a result, we have concluded that there would be significant risks and potential disadvantages to consumers from a mandatory "big bang" introduction of full Home Condition Reports on 1 June 2007. In particular:

Further testing is needed to ensure that Home Condition Reports deliver the assumed benefits for consumers and that the operating systems that support them work smoothly. Design work on the dry run has made it clear that this cannot be completed in time for the results to be taken into account in by 1 June.

A recent report from the Council of Mortgage Lenders identified the real possibility that some lenders might not be fully geared up to use HCRs until 2008-09. In particular the industry’s plans for bringing in Automated Valuation Models means that many lenders will not have them in place by June 2007 and so will continue to seek separate mortgage valuation surveys where they could have relied on a Home Condition Report.

There are concerns about the number of inspectors that will be in place in time for June next year.

Ouch! And there's more.

There's also a quick response from Which's Nick Stace, which includes this:

The new Department for the Communities is not worthy of its title, it seems incapable of defending people in our communities making the biggest purchasing decision of their lives.

The homebuyer was looking to the government to hold firm in the face of criticism from the estate agents, instead the government has shown its house is made of straw.

Even estate agents are trusted more than politicians which is hardly surprising when politicians seem incapable of defending homebuyers. The new "half-HIP" will be a useless but a very expensive waste of time.

Read the rest here, and wait on the full fallout tomorrow.