(1 year, 8 months ago)
Lords ChamberMy Lords, I commend the noble Lord, Lord Kennedy of Southwark, for keeping the issue of the problems facing leaseholders very much alive, to the point of nagging, repetition and maybe boring the Government into submission. It is so important that he has done that, and those who support him really deserve to be commended.
That is why I support Amendments 42 and 43, but they should not be controversial at all; they should be welcomed by the Government. I also commend recent announcements by the Secretary of State, Michael Gove, clarifying—I hope—that the Government are committed to abolishing leasehold and will bring that forward imminently. Hear, hear for that. On this issue at least, many of us across the House, regardless of political differences, will be keen and willing to work with the Government on what we can maybe call the 13th mission of abolishing leasehold.
I want to look at what this has to do with levelling up, because it is a key point. There are 4.6 million leaseholders in the UK and many are first-time buyers, which the Bill seeks to encourage more of. Many of them are from parts of the country that the Bill seeks to level up. We should remember that, in earlier iterations of regional development, the regeneration and gentrification of so-called neglected city and town centres across England and Wales took the form of building blocks of flats. One argument was that densifying areas by building on brownfield sites would allow new housing without urban sprawl or nimbyist objections. My goodness, we even saw such blocks spring up in towns such as Buckley—the place I am from. We joked at the time about the area going posh, with its apartments and café society, never imagining that this would be a source of problems for people rather than a dream come true.
It is tragic to see endless newspaper reports of how this has turned into a nightmare for so many. A recent Manchester Evening News report says that leaseholders in one of the city’s most eye-catching apartment blocks are
“‘pulling their hair out’ over what they claim are ‘obscene’ management fees”
and monthly service charges exceeding £500—for a service charge in Manchester. Think about it; that is a lot of money. It is often even more than mortgage payments.
We should also remember that Margaret Thatcher’s home-owning democracy project of right to buy meant that many former council tenants bought their own home. In fact, they became leaseholders. These former local authority properties are now in the general housing stock and they are relatively cheaper to purchase, especially in London and the south-east. That makes them popular, affordable options as they put home ownership within the grasp of those who otherwise would be priced out of the market. Indeed, when I bought my first house—well, the only house I have ever bought—at 40, it was in those circumstances: the only way I could afford it was to buy an ex-council flat. That was me declaring my interest as well.
Sadly, it has all been a bit of a con, which was only revealed because of Grenfell, as has been explained. It has become clear that leaseholders are not home owners at all. Yes, they have the huge debt in the form of a mortgage, but really leaseholders are a sort of glorified tenant. I will come back to this with my Amendment 210 later in the Bill. However, unlike renters, leaseholders not only have the mortgage but are saddled with maintenance costs, not just of their own property but of whole blocks in the local area. They have no control over expenditure. We should note that there is a new leasehold crisis on the horizon, with local authorities demanding ever-spiralling costs from their leaseholders for building repairs, as councils rush to renovate poor-quality housing to meet the Government’s decent homes standard and to remedy flats to comply with recent fire and building safety legislation.
Council renting tenants are rightly not liable for such maintenance and repair costs, but the bill for entire blocks is then divided between local authority freeholders and individual leaseholders, who have no right to decide the scope or timing of proposed works, or, in fact, to request comparative quotes for contracts. That means that leaseholders are footing the bill for years of underinvestment in council housing stock.
Growing numbers are getting demands for eye-wateringly unaffordable sums. Neil Hosken, a south London teacher, has received a bill for £44,000. In Lambeth, there have been shock bills of up to £98,000. Sebastian O’Kelly from the Leasehold Knowledge Partnership says that his organisation is contacted every week by residents—leaseholders in council blocks—facing financial ruin, and one local council has officials to deal with right-to-buy sales on one side of the desk and on the other officials dealing with buying back council flats from leaseholders who have been wiped out by major works bills. It will be a real problem if we have a Bill about levelling up and we do not tackle this. We will be fooling ourselves if we do not deal with it.
Meanwhile, leaseholders of private flats find themselves, to quote one, “Fighting off one money-making caper after another by landlords and managing agents”. I take the point that we are talking about rogue incidents of freeholders who rip people off, but leaseholders none the less feel that they are being overcharged for insurance, utilities and everything from window cleaning to major building works. The main thing is that they do not have any control.
I think the reason why the Government rightly and perfectly reasonably say that home ownership is something that many people should aspire to, and the reason why a lot of people do aspire to it, in particular many young people, is because people want to have the freedom, autonomy and control of owning their own little place—or big place—so that they will not be dependent on the landlord or anyone else. That is what you think you are getting, but instead leasehold robs you of that control, which instead often belongs to absentee or offshore freehold landlords or their agents, or councils. It is they who call the shots on what happens in your block and even in your own flat. That is why the issue of control of insurance costs is fast becoming a critical battlefield in excessive charges for leaseholders, who are forced to pay towards a group insurance policy but have no control to, as it were, “go compare” which is the best insurance policy to choose.
I do not know whether noble Lords have been following the heroic work of Angie Jezard from Canary Riverside, who spent three years of her life uncovering that she and her fellow leaseholders had spent £1.6 million in secret insurance commissions to a freehold-linked company. This is potentially corruption, and leasehold campaigners and their tireless volunteer legal reps, such as Liam Spender, estimate that excessive costs have been paid that run into thousands of millions across the UK. That is why the proposals in Amendment 42 from the noble Lord, Lord Kennedy, on mandatory disclosure and so on, are important as a first step, but as I hope I have illustrated, and as he has regularly illustrated, the myriad problems associated with leasehold as a system mean that it has to be abolished. This is a Bill that suits that cause, because we can say that we believe in levelling up and that the whole system of leasehold is holding back that project when it comes to housing.
My Lords, I declare my residential and commercial property interests as set out in the register. I am also proudly now a vice-president of the Local Government Association—finally.
I rise, as I naturally do, in support of the noble Lord, Lord Kennedy of Southwark, who is flanked by his formidable wife, the noble Baroness, Lady Kennedy, who sticks up just as doggedly for Generation Rent. I am very pleased to support this amendment. It is a grand coalition, if you like, of the noble Lord, Lord Kennedy, my noble friend Lord Young—who I used to describe as part of the awkward squad, but obviously I am on the Back Benches now so that is irrelevant—and the noble Baroness, Lady Fox of Buckley, who are poised to ensure that this is taken really seriously by the Government. That is why, as a former Leasehold Minister, I join and add my voice.
I want to summarise each of these individuals in one word, which is hard, but I have thought about it for about five minutes. The noble Lord, Lord Kennedy, is dogged—I can remember that there was not a single week when I was a Minister when he would not pop up, and probe, and cajole, and gently swipe, to get stuff done on behalf of all those poor leaseholders when it came to leasehold reform, and to ensure that we got the Building Safety Bill that we needed; that is a truly great contribution and I recognise that.
But I am going to answer some of the points that he raised, because unfortunately I am a bit immersed in the policy detail. There was some action by this Government. When I was the Leasehold Minister, we brought in the first stage of leasehold reform that removed escalating ground rents from the equation, which was the fuel that generated the whole business of leaseholders being exploited by very tricky freeholders. It was the first part of the LKP model—the Leasehold Knowledge Partnership model—of reform, so we got stage 1 done. Now we are set for stage 2 that brings in very important measures for existing leaseholders to enfranchise and get a share of the freehold.
Equally, I chaired many a session of something called the Commonhold Council. I am a commonholder in France and I know that you can be a commonholder in Scotland. It is a tenure that I support and it is something that we want to see widespread adoption of. But we have got to recognise that we have to kill this exploitative business for the future, and that has been partly done by the first stage of leasehold reform. We have got to set a direction that encourages people to have a share in their freehold, and also do what Labour failed to do—I am sorry to be party-political here—under someone called Tony Blair and get it right this time to see the widespread adoption of commonhold.
So the noble Lord, Lord Kennedy, is dogged, and I turn to my noble friend Lord Young, who for me is forensic. There is no element of parliamentary procedure that has not been read by my noble friend Lord Young: he reads everything. The message to the Government is, “Publish the Bill”—which is what the Law Commission advised as well. So I say to my noble my friend the Minister, “Publish the Bill”. We can then start the pre-legislative scrutiny in a constructive way, reaching across the aisle and working together to make this the best possible Bill before we run out of parliamentary time.
I am going to describe the noble Baroness, Lady Fox of Buckley, as philosophical—we have got dogged, we have got forensic and we have got philosophical. What we have before us—a brilliantly crafted amendment —is the opportunity to level up home ownership, and that is why I am here in support of this grand coalition.
(2 years, 7 months ago)
Lords ChamberMy Lords, I am grateful to the noble Baroness, Lady Fox of Buckley, and my noble friend Lady Neville-Rolfe for this insightful debate.
Amendment 26 from the noble Baroness, Lady Fox, would require a review of the financial impact of the new regime. I reassure the noble Baroness that a review is already required by Clause 152, which provides that:
“The Secretary of State must appoint an independent person to carry out a review of”
the system of regulation of building safety and standards and the system of regulation for construction products. Importantly, the reviewer is not limited and may choose to review connected matters, including the matters mentioned in the noble Baronesses’ amendments.
Similarly, Amendment 246A in the name my noble friend Lady Neville-Rolfe would require a review of the impact of the Act. I apologise for the mix-up that resulted in my addressing this amendment in an earlier group. I will repeat for the record that we believe that this further replicates Clause 152 in the Bill and therefore we believe this is unnecessary.
What I do say to my noble friend is that the Secretary of State has to appoint someone to carry out the review within five years, so that is a long-stop date. I am very happy to meet my noble friend to ensure that we get going with this review at the very earliest opportunity to make sure that that long-stop date is comfortably met. We also need to make sure that this review is substantive and learns the lessons of a new regime in the broadest possible sense and addresses the points raised by the noble Baroness, Lady Fox of Buckley, as well those raised by my noble friend Lady Neville-Rolfe, who has had tremendous Front-Bench experience as well as experience as a distinguished civil servant.
With those explanations, I kindly ask the noble Baroness, Lady Fox, to withdraw her amendment and my noble friend Lady Neville-Rolfe not to press her amendment.
I will withdraw but I will come back to the Minister. I think it is important to come back to the Minister and say if it is within five years, I would like it to be brought forward sooner. I do not know why he does not just accept the two years but let us have the meeting to discuss it. At this point, I will not press the amendment and beg leave to withdraw.
(2 years, 7 months ago)
Lords ChamberThat amendment has been degrouped; we are coming to it later, where I have a similar amendment. The Minister might want to wait until then.
I am addressing my noble friend Lady Neville-Rolfe’s amendment; we will come specifically to group 6 from the noble Baroness, Lady Fox, in due course.
It is just that it has been degrouped to be with my amendment on the review. I was just explaining.
(2 years, 8 months ago)
Grand CommitteeI have tricked the noble Lord, Lord Khan—I am responding to this one. First, we have not gone around counting every balcony in the country. Given that there are 7,500 medium-rise buildings and about 12,500 high-rises, we have other things to do with our time.
I met the devolved Administrations of Wales and Scotland today; we need to know roughly how many buildings require remediation and then do it as quickly and effectively as possible. There is some way of knowing that with high-rises, and through surveys we have a pretty good grip on the number of buildings where remediation may be required—it is actually very few—as well as mitigation. Increasingly, we want to see more innovation so that we can avoid costly remediation wherever possible.
The noble Baroness, Lady Fox of Buckley, is very clever. I have been trying to distil amendments in up to three words—I have got it down to two on one occasion—and it would be easy to say that this is the “balcony” amendment, but I do not think it is. It is the “proportionality” amendment. It is fair to say that this was addressed when, on 10 January, my right honourable friend the Secretary of State set out some building safety reset principles. He said:
“We … need to ensure that we take a proportionate approach in building assessments overall … too many buildings … are declared unsafe, and … too many … have been seeking to profit from the current crisis.”—[Official Report, Commons, 10/1/21; col. 283.]
The noble Baroness was very eloquent in giving examples of precisely that—where, essentially, an industry is fuelled by trying to profit at the expense of leaseholders, very often, who do not have the shoulders to bear the costs being charged to them. That is why we are putting a number of protections for leaseholders in this Bill, for both cladding and non-cladding costs, which we have discussed in other groups, and the very strong principle that the polluter must pay wherever possible, as we discussed in an earlier group today.
The Government have taken three measures with regard to proportionality. It is important to reflect on them, because they are easily forgotten as we debate things. None is in this Bill; I will turn later to some things that are. First, we withdrew the consolidated advice note of January 2020; that was seen as a driver of decisions to remediate without thought on too many occasions, when it was not necessarily the right way to go. Secondly, after withdrawing the advice note, the publicly available specification was introduced, produced by the British Standards Institution; it will enable fire engineers and other experts to have a consistent and auditable assessment of risk—basically, grading whether something is high, medium or low—of the external wall systems, which sometimes include balconies and sometimes do not. That is an important tool to have to be able to start having sensible risk-based assessment of external wall systems.
I have one query on that. I thank the noble Lord for his response, but on the recommendation of high, medium and low risk, everything I have read on this suggests that with high or low risk we know where we are, but medium risk says, “There is some risk, but don’t worry, you don’t need remediation”. The point made in everything I have read is: who will go along with that? If you say that there is medium risk—this is where risk aversion comes in—there is concern that the assessors do not have the expertise, as has been referred to, and may say, “There is medium risk, but can I go home and sleep at night, because I am not quite sure what that means? There might be a risk.” That is where blame avoidance comes in. This comes back to the assessors; I do not think that will solve it.
I did not say that it would. The noble Baroness intervened too early; that is the problem with interventions. No one was saying that any single thing—
I was just trying to clarify something—that is good.
The noble Baroness raises the issue of balconies. I am talking about a system that looks at the external wall system. We then have the Fire Safety Act, which we took through this House. I have all the scars to prove that it was not an easy matter to get that three-clause Bill past a number of the people here today. We got it on the statute book, however, and it will commence shortly with a building prioritisation tool.
The noble Lord, Lord Stunell, spoke very eloquently on fire risk assessments. They will look at the risk in the round, going beyond external wall systems and including balconies, the external walls, the flat entrance doors and whether they are fire doors, et cetera. Fire risk assessors will have to look in the round, consider whether there are enough ways to exit the building and come up with a series of action steps, which will often be very small, that can make a building safer. It is right that we make sure that those risk assessments are done by competent professionals. They need to be kept up to date. They will come up with a series of actions that can be taken. Not all of those will require huge expense, but they will make the building that little bit safer.
I think noble Lords need to see this as a package. In answer to questions raised, the proportionality agenda does not have a silver bullet as an answer, but there are a number of things that the Government are encouraging that will lead to a more proportionate approach. PAS 9980 refers to materials on a balcony that may be combustible, such as timber decking, which may be relevant even if the construction of the balcony itself includes materials that present minimal or no risk. The current position, with the inclusion of balconies in the fire safety order and the professional guidance in PAS 9980, is all about encouraging that proportionate approach.
The competence of fire risk professionals is a relevant factor and ensuring that is a major objective of the Bill. We are bringing about greater professionalism in the sector through Clause 129, with a requirement that anyone appointed to undertake a fire risk assessment must be competent. That stipulation is in the Bill, in answer to the noble Lord, Lord Stunell. A lot of this is not happening in the Bill, but there are clauses which aim to drive competence, which directly answers questions raised in this debate. That is what we have to look to, rather than necessarily seeing this specific Bill as the answer in isolation. We must look at the measures the Government are taking in the round.
My Lords, I thank all noble Lords who have spoken. My heart was in my mouth when the noble Earl, Lord Lytton, spoke, because I thought, “He knows what he’s talking about and I’m not sure I do”, so I was glad that he recognised something in what I said on the professional point about materials and so on. I am not an expert but I know lots of people who work in this area.
My concern is that there are blocks of flats all around London whose residents are being told that the balconies have to be remediated, but they have passed their fire risk assessments. This is basically coming from freeholders acting in a precautionary fashion, as in the Dorset example I used. They have said, “We think some of these balconies are unsafe. We’re going to take them down and you have to pay.” They are using safety as the basis but they should have maintained the balconies. There is great concern about the balcony question but I have been caught out by the Minister, because this was really an attempt to talk about proportionality. That is what I really wanted to do. Although I keep hearing about balcony scandals, that was my main focus.
We want to keep people safe all the time, but the right reverend Prelate the Bishop of St Albans made the important point that safety has a cost. Carrying on from our Committee meeting the other day, I was talking about a cost-benefit analysis and always thinking about balancing. If you want 100% safety, you would never leave the house. We also need a sense of proportionality towards fire, which is still very rare. People are not dying of fires in their thousands, in this country. I want to get the right balance.
The noble Lord, Lord Stunell, made a very important point, on which I have been trying to get balance. As a leaseholder, I have tried to speak on behalf of leaseholders a little, because I thought I could make a valid contribution. I am not suggesting that every time a leaseholder says something, we all have to believe it. Leaseholders are not experts, and their fears and concerns should not make the decision, but sometimes it is worth asking them what they know or think and part of the Bill suggests that. The objective point about competence is key. I am suggesting that, because of blame avoidance, fear of litigation and measures being brought in by the Bill, people will always take the most risk-averse decision. That could be at the expense of leaseholders and will not necessarily improve safety.
I shall withdraw my amendment, but I hope it has contributed to a broad discussion to which we can return on Report to make sure that the Bill does not create more problems than intended.
(2 years, 11 months ago)
Lords ChamberMy Lords, I have to say that that is putting words in my mouth. We want to discourage smoking. As I said, we as a Government are trying to move towards a smoke-free 2030. We are trying to ensure that the smallest possible number of children take up e-cigarettes—we are seeing great progress on that. We are taking a number of measures to eradicate this and hit that target. At the same time, we believe in personal choice. That is something that this Government strongly believe in and it is also a route to seeing a stronger bounce-back and a stronger economy as a result.
My Lords, is there anywhere in the public square where smokers will be left in peace and permitted to indulge in a legal, if anti-social, habit that they as adults freely choose to indulge in and even enjoy? Does the Minister consider that the rather grungy lean-to behind the bike sheds that noble Lords who smoke have been banished to is suitably far away from any restaurants or bars to be safe from overzealous public health regulators in here, or might we be driven into the Thames? I am asking for a friend or two.
My Lords, I have to say that because alcohol is served in that grungy location, it attracts even me and I am a non-smoker. I believe in personal choice and I recognise what is legal and illegal today.
(2 years, 12 months ago)
Lords ChamberMy Lords, I can give that assurance. We must provide our faiths and beliefs, particularly a religion such as Islam, with the same protections as all other important religions, but we must not make the mistake of conflating religion with race, as I said in the previous answer.
My Lords, it is crucial that we distinguish between aberrant anti-Muslim bigotry and the highly contentious concept of Islamophobia which threatens free speech for fear of it being labelled Islamophobic. Does the Minister acknowledge this chilling effect for liberal Muslims, as is well described in the Don’t Divide Us film “‘Islamophobia!’ The Accusation that Silences Dissent”, muting any criticism of Islam as a religion and even muting critiques of political Islamism, however dangerous? Does the Minister accept the nervousness of politicians from all parties in supporting the Batley Grammar School teacher who was forced into hiding under shouts of “Islamophobic”, effectively allowing a default blasphemy law to be snuck in for fear of being called Islamophobic?
My Lords, I do recognise that issue and I was trying to point that out in the responses I gave to previous supplementary questions. There is no doubt that the term “Islamophobia” is used as a heckler’s veto to shut down alternative opinions. We need to come up with a way forward that does not compromise free speech, and that is absolutely what we are committed to doing.
(3 years, 1 month ago)
Lords ChamberMy Lords, I want to issue a trigger warning: the demonstration by thousands of leaseholders from all over the country at 1 pm today is likely to be very noisy. Luckily, they sneaked it in before the police and crime Bill could ban it. But seriously, I am delighted the Minister says he will come and meet the people affected. They have a range of creative solutions to offer and feel that their best ideas are being ignored and that they are treated like whingers. In addition, will the Minister do some internal lobbying of the incoming Secretary of State for Housing and explain the strength of feeling, frustration and fury across this House about the inadequacy of the solutions so far put forward? Leaseholders have ideas; listen to them.
My Lords, I agree that it is really important to engage with the people affected. I have a considerable number of meetings with leaseholder groups and am in constant virtual contact with some of the people who I believe are doing their very best to see how we can creatively address this difficult issue. I am very happy to meet the people today. It is important that as politicians we step forward and meet those people affected.
(3 years, 4 months ago)
Lords ChamberMy noble friend will be pleased to know that we have announced our intention to provide a scheme that enables professionals who carry out EWS1 to have sufficient professional indemnity insurance cover. We are also engaging with the Building Societies Association, UK Finance and the major banks so that they look at other forms: for instance, an updated fire risk assessment or, for buildings constructed after 2018—post Grenfell—sign-off from a building control inspector. There are lenders that have led the way on this by taking a more proportionate approach in not always requiring an EWS1 certificate.
My Lords, the Minister keeps saying that updated guidance from the Royal Institution of Chartered Surveyors means that leaseholders will no longer need a form to sell their homes, but they do. He says that the EWS1 is not a government formal legal requirement, but mortgage lenders continue to insist on the form. In the end, the only reason all this has happened is because of government policies. When will the Government take responsibility for the leaseholders trapped in homes they cannot sell or remortgage? Has the Minister noticed that the media are now running with this story? Because of grassroots cladding and leaseholders’ groups, there is huge public interest: beyond Inside Housing, we have had Radio 4 and Channel 4, and all sorts of newspapers. We even had Rebecca Long Bailey on GB News—
My Lords, we recognise that there is a problem and we are taking the steps required to ensure that where an EWS1 form is requested, it is easier to get the professional to carry it out, but also encouraging the banks to look at other documentation as an alternative—a proxy—to show that the buildings are safe. It is important that we go ahead and identify those buildings whose external wall systems require remediation.
(3 years, 5 months ago)
Lords ChamberMy Lords, obviously we take into account whether developers are good partners. There are many national schemes they will want to access for their businesses. We monitor very closely the number of defective buildings and whether the developers step up and contribute. That will be a factor in their future relationships with government at every single level.
Will the Minister acknowledge that, by kicking this scandal down the road, the political crisis surrounding who pays for fire safety defects has not gone away but intensified, while the financial demands on blameless home owners who are unfortunate enough to be leaseholders are escalating way beyond cladding? Will the Minister specifically investigate the spiralling costs of the enforced requirement for waking watch patrols provided by private security firms, whose efficacy is, to say the least, contested? I note that the average cost to individual leaseholders is an extra—unaffordable—£400 a month even before the huge remediation bill drops through the letterbox.
My Lords, I was asked to carry out a waking watch review on behalf of the Secretary of State some months ago. The noble Baroness is right that it is a significant cost for leaseholders. This is why we created the £30 million waking watch relief fund, which will help between 300 and 400 buildings put a fire alarm in place and benefit between 17,400 and 26,520 leaseholders, who will no longer have to pay those high interim costs for waking watches.