Residential Leasehold

Wednesday 17th May 2023 Lords Chamber

Question

15:37

Asked by

[Lord Kennedy of Southwark]

To ask His Majesty’s Government what action, if any, they are taking to abolish residential leasehold before the end of this Parliament.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, in begging leave to ask this Question, I refer to my interests in the register and declare that I am a leaseholder.

[The Parliamentary Under-Secretary of State, Department for Levelling Up, Housing & Communities (Baroness Scott of Bybrook) (Con)]

My Lords, while I cannot set out precise details of a future Bill at this stage, the Government have been clear about our commitment to addressing the historic imbalance in the leasehold system and to extending the benefits of freehold ownership to more home owners. We will bring forward further reforms later in this Parliament.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, that is just not good enough. It is extremely disappointing but, sadly, par for the course. Promises and pledges have been made, and promises and pledges have been broken. Over the last year—on 20 June, 14 July, 20 July, 17 October, 12 January, 20 February, 22 February, 23 March and, most recently, 2 May—I have raised these issues and been told that the Government intend to bring

“the outdated and feudal system of leasehold to an end.”—[Official Report, 20/2/2023; col. 1444.]

We now hear from the media that that is not going to happen in this Parliament. That is just not good enough. Will the Minister take the opportunity here today to apologise to all the people trapped in the leasehold nightmare who have been let down by these broken promises, and explain to the House why we should believe these latest promises and pledges?

[Baroness Scott of Bybrook (Con)]

My Lords, as I have said before, property law is fiendishly complex. It is absolutely right that the Government take the time needed to make sure that the reforms are right. As I have said before, the Government will bring reforms to the leasehold system in this Parliament, but I cannot pre-empt the King’s Speech by confirming at this time what will or will not be in future legislation.

[Lord Young of Cookham (Con)]

My Lords, has my noble friend read the article in last Sunday’s Sunday Times, which outlined the problems facing leaseholders who want to extend their lease? Because of the uncertainty to which the noble Lord has just referred, they do not know whether to extend their lease now or wait until the legislation that has been proposed, which may enable them to extend on fairer terms. This blight is beginning to affect the market in leasehold. Is not it important that the Government are clear as soon as possible as to what their proposals will be?

[Baroness Scott of Bybrook (Con)]

I understand the concerns, and yes, the Government will be as clear as they possibly can, when they can. Importantly, every leaseholder is in a very different situation and has different considerations. Specialist legal advice should be taken by leaseholders at this time if they are considering enfranchisement or extensions. The Association of Leasehold Enfranchisement Practitioners and the Leasehold Advisory Service can offer that advice to leaseholders, and I urge them to take it in this time, before we can make any further announcements.

[Lord Truscott (Non-Afl)]

My Lords, as a landlord, leaseholder and former renter, may I ask the Minister this: since the Government seem to be backtracking on abolishing leasehold by the end of this Parliament, can she at least commit to reforming this archaic and feudal system?

[Baroness Scott of Bybrook (Con)]

I do not agree with the noble Lord. The Secretary of State has made it clear that we want to bring forward reforms to leasehold, and we want to do so during this Parliament. We wish to extend the benefits of freehold ownership to more home owners. In line with our manifesto commitments, we will continue leasehold reform during this Parliament. We are working with the Law Commission to bring forward game-changing reforms to the system, and we thank the commission for all the work it has done in this area. As I have said, I cannot at this Dispatch Box pre-empt the King’s Speech.

[Lord Cormack (Con)]

My Lords, my noble friend in answer to a question a moment or two ago referred to people taking legal advice, but how can lawyers give advice if they do not know what the Government are proposing to do?

[Baroness Scott of Bybrook (Con)]

I thank my noble friend for that question. What they can do is give them the options they should consider at this time.

[Baroness Pinnock (LD)]

My Lords, on the current plight of leaseholders, there are 11,000 high-rise and medium-rise blocks in need of life-critical safety work since the Grenfell fire tragedy. The Government have made progress and done a contract with 43 or more developers that will put right those blocks—but only 1,100 of them. What assurance can the Minister give the other 10,000 that their work will be done at no cost to those leaseholders?

[Baroness Scott of Bybrook (Con)]

I assure the noble Baroness that the Government are doing everything they can. They are making sure that, as she has said, the perpetrator pays, and they have put large amounts of money into this. It takes time to work through the remediation of these buildings, but we are working at pace and pushing the industry the whole time to ensure that it makes these buildings safe as soon as possible.

[Lord Bach (Lab)]

The Minister agrees that some leaseholders will need advice, but who is going to pay for that advice? Do the Government think they might extend legal aid to cover it?

[Baroness Scott of Bybrook (Con)]

No, we do not intend to extend legal aid. For leaseholders who are considering what to do in future, we have made it very clear that it will be in this Parliament, and they just need to wait and take advice at this time until we can get these changes in place.

[Baroness Fox of Buckley (Non-Afl)]

What is the Minister’s response to the revelation from the Commonhold Now campaign that, according to polling, 60% of those who voted Conservative in 2019 support the abolition—not the reform—of leasehold? Perhaps that might concentrate minds.

The Minister says that she cannot at the Dispatch Box pre-empt what is in the King’s Speech, but it is at the Dispatch Box here and in the other place that the Minister and the Secretary of State have constantly assured the noble Lord, Lord Kennedy, and others that leasehold will be abolished. If it is too difficult for this Government to do, maybe that says more about them than it does about leasehold law.

[Baroness Scott of Bybrook (Con)]

We have made it very clear that we wish to extend the benefits of freehold ownership to more home owners. That is why we have committed to ending the sale of new leasehold homes and houses to reinvigorate commonhold, so it can finally be a genuine alternative to leasehold. But, as I have said before, we know that, on commonhold work for flats, the Government, industry and consumers will all need to work together, which is why we established the Commonhold Council to prepare home owners and the market for what we want to do, which is to give this freedom to more home owners.

[Lord Kamall (Con)]

My noble friend just said that property law is fiendishly complicated and that is why this has taken some time. Will she enlighten us as to some of the complicated issues that have to be tackled before this law can be brought forward?

[Baroness Scott of Bybrook (Con)]

The Government are working with the Law Commission; we have asked it to recommend reforms to commonhold legislation, and it published its report in July 2020. We are considering those recommendations and will respond to them in due course, but it is a fiendishly complex system.

[Lord Brownlow of Shurlock Row (Con)]

My Lords, earlier my noble friend Lord Young of Cookham presented a choice for leaseholders today. I think the Minister has just indicated that leaseholders should wait. Maybe she meant they should continue to weigh up their options until things become clearer.

[Baroness Scott of Bybrook (Con)]

I thank my noble friend. That is perhaps exactly what I should have said: they need to just wait until we have clarification, and it will not be long, because it will be in this Parliament.

[Lord Cromwell (CB)]

My Lords, is not one of the obstacles to movement forward on this that landlords are going to find that the leaseholders have become freeholders, and that they are going to seek compensation? If so, from whom?

[Baroness Scott of Bybrook (Con)]

I have had no indication that they will do that, but if they do we will have to look at that issue.