Baroness Gardner of Parkes
Main Page: Baroness Gardner of Parkes (Conservative - Life peer)Enterprise and Regulatory Reform Bill
Baroness Gardner of Parkes Excerpts
Lord Jenkin of Roding
My Lords, I hope that the noble Lord, Lord Campbell-Savours, will forgive me if I do not follow him in his very interesting description of what may happen in auctions, but I look forward to hearing the reply from my noble friend on the Front Bench.
Coming back to the amendment that was moved by the noble Baroness, Lady Hayter of Kentish Town, I will just raise one or two points. Members of my family have been both lessors and tenants in the present market and, apart from one case, have on the whole had good experiences. I was approached by the Association of Residential Letting Agents, ARLA, and have been quite impressed by what it has told me. Its primary function, as it puts it, is to professionalise the profession and to make sure that it has high standards and that those who enter the profession understand what the standards should be. It operates a voluntary scheme of registration and its anxiety is that a number of letting agents do not register for whatever reason, one of which may be that they do not want to comply with the standards.
Can my noble friend refer to one particular point when he replies? The noble Baroness, Lady Hayter, reminded us that, in opposition, my honourable friend Mark Prisk moved very similar amendments to legislation before the House produced by the then Government. In the debate in Grand Committee on 16 January—I apologise, again, that I was not able to be there—after referring to the speech that I have read from my noble friend Lord Deben, who gave the clear impression that he supported the amendment of the noble Baroness, Lady Hayter, my noble friend Lord Younger said:
“I note and respect the intervention of my noble friend Lord Deben in this respect as well. I know that the Housing Minister is aware of these concerns but I will raise them with him for further consideration. It is clear from the speech from the noble Baroness, Lady Hayter, that he—Mark Prisk, my honourable friend in another place—is aware of the issues that she has mentioned”.—[Official Report, 16/1/13; col. GC 250]
At this stage, all I need to ask is whether my noble friend Lord Younger approached Mark Prisk and what his response was. What was his reaction when reminded that he had in fact moved a very similar amendment himself when in opposition?
One is tempted to say, “Let us return this clause, with this amendment, to another place so that my honourable friend Mark Prisk may have an opportunity to say why he has changed his mind”. I am not sure that that would necessarily be the right thing to do but I will be impressed and influenced by the answer that my noble friend on the Front Bench gives me to this point. I find it difficult to accept that you can hold one very clear opinion in opposition and then find yourself responsible in the same field and hold a completely different one. It is often, as my noble friend Lord Deben said quite firmly in Committee, because it is a departmental attitude, which in this case may stem from the Treasury. As a former Treasury Minister, all I can say is that I understand that does in fact happen from time to time. However, whatever the reason, it does not seem to be a very satisfactory position and I look forward to hearing my noble friend on the Front Bench explain it.
Baroness Gardner of Parkes
I will start at the back and deal first with Amendment 82, in the name of the noble Lord, Lord Campbell-Savours. You might think that auctions are bad here but you should see them in Australia. I bought my flat at auction out there and what they do is start the auction and when they reach a certain point they stop and say, “We’ll have a break”. In the break, they get hold of the vendor and say, “Why don’t you come down on your reserve?”, and get hold of the purchaser and say, “Why don’t you go up on what you are going to buy?”. They might do that two or three times within the auction. Fortunately I had someone helping me, who made clear to the auctioneer that if they went on and broke more than once, we were out. We got the property and I have had it a very long time.
There are good and bad things about auction. I accept the point the noble Lord made about deceiving people about how cheaply they are going to get something, but of course it is unpredictable and properties sometimes really do not sell, while in other cases they do. At least with an auction all the documentation about the property is provided in advance of the auction so people are not kept in the dark the way they are with lettings and by managers. People launch into a property they are going to rent, or buy leasehold, and they find that there are all sorts of hidden clauses that no one ever drew their attention to and that no real documentation is available. It is quite different; each system might have its faults but they are different faults and it is hard to know whether you will ever get them right.
However, I have a certain sympathy with the point the noble Lord, Lord Campbell-Savours, made. If you have gone a long way it is very difficult—you have gone to the trouble, you think the place is going to be within your range but it is not. It is really very hard to resolve that one. Do people wake up to the fact that it is just a selling technique, which happens all the time, or are people genuinely taken in by these deliberate ploys? It is complicated but he has got a very interesting point that requires further investigation.
I strongly support the amendment of the noble Baroness, Lady Hayter. Talking about letting agents, I was quite stunned to see on television people letting these sheds in some parts of London. They had no windows or anything in them; a family of 10 living there and sometimes no running water or electric light. It was just unbelievable. The people who were renting them produced leaflets from the agent who was offering them to let. When the BBC—I think it was the BBC although it could have been another broadcaster—went to say to these people, “How could you be letting this when it has no planning permission and does not conform with any health standards of any sort?”, the answer was, “Oh, no, we were never letting it”. Yet they had proof in front of them of the printed leaflet about it being available to let from that particular agent. That is the absolute bottom of the scale but between that and the really desirable letting agent, there are all sorts of gradients.
“Leasehold Valuation Tribunals: costs
At the end of paragraph 10 (costs) of Schedule 12 to the Commonhold and Leasehold Reform Act 2002 (leasehold valuation tribunals: procedure) insert—“(5) A tenant of residential property shall not be required to pay costs incurred by a landlord or any other party with an interest in that property in connection with proceedings before a leasehold valuation tribunal except when their lease specifically permits such costs to be included as a legitimate management charge.””
Baroness Gardner of Parkes
My Lords, I shall speak to the group of amendments in my name, so that we do not have to keep coming back on different items. I have been asked to put them all together. I will start with Amendment 81F because that is the most important of them all. That has come about because of the court decision recently in the Phillips and Goddard v Francis case that any amount of work to be done per flat worth more than £250 in a year would require consultation. If, for example, it was a block of 10 flats and you had spent £2,500, after that, for everything, even if it was for £1, £10, or whatever, you would have to implement a consultation process.
In their answers tonight, the Government have told us that the one thing that they want to avoid is lots more paper, cost, expense and consultation. That is exactly what the amendment is designed to achieve. The Public Bill Office has now gone online and worked out that the sum of £250 should in today’s prices be £330, so that is why there is a difference in the figures. We have gone through it carefully, and we think that certain things are particularly important or desperate, such as fire provisions, safety provisions and—one of which I have had personal experience—when the front door of a block of flats is damaged. What would happen if you had to wait for about two months to get consent for you to put on a new front door lock, although it was so urgent?
We do not wish to change the law at all. We wish to clarify the law as it is to make clear that the £250 is not an annual figure but a per item or per effective work figure. That amendment is straightforward and the Government should certainly consider it. I have heard them tonight and 50 million other times say that they want to reduce costs, difficulties and expenses. This is the opportunity to do it. Otherwise, every tenant will be burdened with so many consultation documents that they will get to a point where they barely look at the really important, serious one because they say, “Oh, that’s another one from the agent and it is all out of my pocket”. Amendment 81F is really simple.
Amendment 81B concerns leasehold valuation tribunal costs. I tabled the amendment because when I asked about the cost of leasehold valuation tribunals, which, at the moment, are limited to £500 for any applicant, I found that the practice, which is quite wrong, has arisen where the landlord, head lessee, or whoever is at the next stage above the leaseholder, is bringing in more and more expensive legal brains against the ordinary applicant. The worst thing about that is that, win or lose, the amount paid for that extremely major legal defence is charged back to the residents in the leasehold flats as a management expense. That was never the way that leasehold valuation was envisaged. In 1996, I was very involved when we passed the legislation. Those things were specifically against what we wanted. We wanted it to be approachable for anyone at £500. I received a letter from the noble Lord, Lord McNally, from which I understand that later in the year it will be swallowed up into a major tribunals review and the figure of £500 will probably rise. However, that is different from where the unlimited cost is being charged back to the leaseholders. That is the reason for that amendment.
Amendment 81C concerns a redress scheme. As we pretty well won the redress scheme with the previous amendment, which has just been passed, I do not think it is so important any more. However, when we had a round-table meeting at the department of all the interested people, they all said, from the most extravagant people down to the most careful, that the one thing that could save time, trouble, expense and simplify life for everyone would be a redress scheme. Therefore, no matter what happens with the previous amendment, I am hoping that at Third Reading the Government might bring forward some wording on a simple redress scheme.
That takes me on to Amendment 81D and protection schemes for service charge money. The noble Baroness, Lady Brinton, mentioned that university students had a problem regarding their deposits and so on for the premises they were letting. I pay full tribute to the Labour Government who as a response to that introduced protection for tenancy deposits. Tenancy deposits are well-protected now. No longer can an avaricious landlord grab every penny of your deposit money. Even if you are just an ordinary individual, letting property without an agent or anything like that, you have to place the deposit in a secure government scheme, which is very good and desirable. However, why is the same amount of protection not given to people who pay service charges, which are probably very much larger amounts?
Amendment 81E concerns the redress scheme. If I am satisfied with how the previous amendment, which has just been passed, is interpreted, I will not bring it back at Third Reading. However, if I find there is something that really could be clearer or better, I might bring it back. I beg to move.
Baroness Gardner of Parkes
My Lords, I listened to the explanations from the Minister, some of which are quite unsatisfactory. For example, he says that what people are really concerned about is the level of service charges and that we want to keep those down, and so on. We all understand that. But he then rejects Amendment 81F, which is so important and would clarify exactly what you can and cannot do in a block with or without permission and would tremendously reduce the paperwork and red tape, with its terrible waste of time and money, on the ground that it is perhaps too cheap and saves too much. I do not know on what ground he is rejecting it but I do not accept that it is fair to reject it.
The Minister says that they will look into it over the coming months, but the coming months are too long. Even this Bill is going to take quite some time before it goes through. The thought of having extra “coming months” on top of that is just too much, so I do not really accept his arguments. As I said, if the amendment tabled by the noble Baroness, Lady Hayter, covers a redress scheme that is mandatory for everyone, and if they would have to belong whether they are managing agents or whoever, then I am satisfied with that. I would not then want to pursue it further myself because if we have put a good scheme through, that might be the thing to run with and it would not need amplification.
If, on the other hand, after studying the noble Baroness’s amendment, to see what it means and whether there are any loopholes in it, I think there is still a need for clarification on redress I would want to come back on that. In no way could I say that I have forgotten this matter. I warn the Minister to expect me to return at Third Reading, by which time I hope we will be a bit clearer on exactly what is good and bad in what we have decided tonight. Fortunately, there is the opportunity to return at Third Reading. I reserve my right to do that because nothing has been said today that really satisfies me completely on those amendments. I beg leave to withdraw the amendment.