Housing and Planning Bill
Debate between Baroness Gardner of Parkes and Lord Campbell-Savours
Lord Campbell-Savours (Lab)
My Lords, the answer to the noble Lord’s point is quite simple. Local authorities are not carrying out their statutory responsibilities and there are people all over this country living in squalor because the authorities simply do not have the resource to follow up their responsibilities and deal with that squalor.
Baroness Gardner of Parkes (Con)
I find the point just made by the noble Lord interesting. He is quite right that there are people living in squalor but, unfortunately, we have also taken away the right of regulation. Local authorities can no longer check now to see who is living in a property, how long they have been there and whether they are just flying in and out. The local authorities were willing to agree to 24-hour licences, so that people coming in for quick holiday use could be accommodated because that is modern travel: people want to do something in 24 hours. But when I spoke on this issue they made it clear to me that, unless you know how many people are living there and for how long, there is no way to have it within the limited amount of time in the year. You cannot even have any idea what that limited amount of time would be. That is one of the problems.
We have seen articles in the press recently saying, “Watch out for all those piles of rubbish outside some property—it shows that it is occupied by many more people than there is the actual facility for. If you see triple-decker beds going in, they are let out at £70 a night to people”. All that definitely has to be caught up with but I find some of the other points in this amendment very strange. I do not think that they are all appropriate. If we interfere too much in the private letting sector—oh! Exactly which amendment are we speaking to now? Is it Amendment 32?
Housing and Planning Bill
Debate between Baroness Gardner of Parkes and Lord Campbell-Savours
Baroness Gardner of Parkes
I would like to respond to the point made. I think it is very interesting.
First, I should have spoken to Amendment 84F as well as Amendment 84E, because the two are linked on the groupings list, which I had not realised. The situation as described sounds entirely different from my own personal experience. My experience is that people who do not live in these places at all—except maybe for a few weeks in the summer when they come from somewhere overseas—do not respond to any attempt to contact them whatever. If you end up with a sufficient majority of those people, you cannot get anything done. There is no money to put forward even for emergency repairs. In each case you are asked to pay your money in advance, before the work can go ahead. Often legal action has to be taken against someone who says, “No, I’m not paying until I’m sure you’re doing the work”. An instance in hand was that, as the building was old, we wanted to have all new windows at the front. We all paid our money for them. People came and put up the scaffolding and the windows were delivered. The council arrived and said, “Have you got permission for that?” “Oh no, we phoned up and they said you don’t need it.” “Oh yes, you do. This is a conservation area”—the building itself is not worth conserving, but it is a conservation area. So the windows were all taken down, taken away and thrown away. We paid for them but we never got them, which was pretty disastrous for everyone.
Other times when someone needs emergency work done on the boiler or heating systems, again the money is needed up front—and people often have to be taken to court to get it. They might claim that they had not been justifiably contacted, but with the right to manage there could be a contact address or a proxy for every single resident or owner in the block.
I went to a meeting with Peter Bottomley, who is in the other place, and someone stood up from the department there. They said that the department was seriously considering the idea that if you fail to respond in any way you would be deemed to be not opposed to whatever was suggested. I then came back to this House and tabled a Question on that and I was told, no, that was not being thought about. Now again I am told that maybe it is being thought about. I find it extremely confusing, but I am looking for some way whereby you can deal with non-resident, uninterested parties who would allow places to fall apart.
Lord Campbell-Savours
The answer is actually in the original deed. If on acquisition of the property and purchase, the original deed specified that a suitable majority was sufficient to take a decision and the purchasers signed up to that, they are bound by that. The resident association, or the management company if it is run by the resident association, would have that in mind when it took decisions. Both these amendments could be dealt with in terms of the original lease. In the event that a lease change is required, then you would need—to be fair, in my view—a 100% majority turnout, or proxy or whatever, of all the residents to take that decision to introduce these provisions into the lease. If that is done then it is fair, but to impose it on people who may be reluctant to accept it is quite wrong.
Baroness Gardner of Parkes
The second to last point the noble Lord made was that you have to have 100%. The problem is getting the 100%. I have asked Questions in this House—I had the Library look them up and there must be at least six—and each time the Government have answered that it is impossible to get 100%, or that it is very easy to avoid getting 100%. All you need is a landlord who has a different interest to pay one person or own one flat in the block himself and he can prevent any action of any sort to improve or maintain it.
Lord Campbell-Savours
When the noble Baroness purchased her apartment, she would have done well to ask her lawyer to read the lease and explain to her what was in that lease; it would have precluded her doing what she is suggesting now.
Baroness Gardner of Parkes
We have gone into this legally in great detail over many years, but the answer is no, you cannot amend anyone’s lease unless everyone agrees to that. That is why I would be quite happy with the 100% if one could be sure of replies from 100%. However, if the replies do not come one way or another, it is very fair that the action should be deemed to be not opposed. They would be given ample time. They would be able to produce—this happens in Australia and everywhere; it is very simple management—a contact or someone who could attend any meeting as a proxy. They can authorise a party. There is no reason why they should not be able to reply in some way. They either deliberately wish to be obstructive or they are uninterested. Either way, it can have a disastrous effect on everyone else in the block. You need only one person to be obstructive.
In the description I gave, the landlord himself—the head lessee—has now bought one. He is happy to take on every flat that comes up if anyone wants to leave. He is always offering to buy mine. The point is that to get that 100% is acknowledged to be impossible. Certainly it is very difficult. Even when you agree on the works to be done and everyone is prepared to pay their money, there are always a few who have to be taken to court and works never start until all the money is available to pay the contractor. This means that terrible deterioration can happen during that period. Of all the points that are in these two amendments, to me, that concerning the leaseholder who fails to participate in the vote is the most important. In that instance you are being deliberately manipulated or controlled by people who do not have enough interest to bother expressing their views.
Baroness Gardner of Parkes
My Lords, I take the point made by the noble Lord, Lord Beecham, that the wording might be defective. The purpose of Committee stage, however, is that it is the topic that you are really discussing and you can always go back and correct the wording. So that is not really the issue but I appreciate his point, though I thought the Public Bill Office had done jolly well even to get it as clear as it is, because I found it impossible.
The Minister has not looked at the entire situation. He keeps talking about the freeholder and the leaseholder, but what about the head lessee—the person between the freeholder and the leaseholder? This is where most of the problems come in. The head lessee should not even exist because the head lease should have been offered to all the people in the block, but because of that company law loophole it was not. That therefore creates an extra intermediate tier. Where that happens, you are in quite a degree of difficulty. Our freeholder seems quite benign and willing to go along with things, except where he evidently agreed to set up this sister company and floated it off to an outsider as a leaseholder —the head lessee. It becomes very complicated when you get these extra layers in management, and it means that each process has to go to each person.
I cannot remember the detail, but something meant that until we got to the door of the court the head lessee would agree to nothing. We were applying to the court to deal with it without his consent because he refused to respond to any correspondence, making it very difficult for everyone. Right at the last moment, there was a message from his solicitors saying, “We agree”. What was at issue was nothing terribly major, but it was hard to believe that we had to go through those legal procedures to get a simple agreement about something.
Lord Campbell-Savours
May I make a suggestion to the Minister? There is a reform that would be helpful. Some freeholders require 50% of the residents to agree to the formation of a residents’ association that they are prepared to recognise, but unless they get 50% the freeholder will not recognise it. I would like to see, in law, some requirement for a lesser percentage. Particularly in blocks of flats in London, where you have large numbers of residents living abroad—despite the amendment moved by the noble Lord, Lord Young of Cookham—the fact is that you cannot get their addresses and therefore you are often limited in the number of people you have access to in order to meet that 50% threshold. Perhaps the Minister might ask officials to look at that. A nice little amendment to that effect on Report would be very helpful.
Housing and Planning Bill
Debate between Baroness Gardner of Parkes and Lord Campbell-Savours
Baroness Gardner of Parkes
My Lords, I thank those who have contributed to this debate, but I do not think that anyone has any idea what goes on under the surface. In the particular block that I am speaking about, the head lease should have been made available to all leaseholders in the block. However, a loophole in the law allows someone to set up a sister company with the same directors and, after two years, to sell it to any outsider. This is what happened—the head lease was sold over our heads to an outsider. The outsider then has to decide whether or not they are going to be a good landlord. The tenants and residents tend to believe that the intention is to make the place so uninhabitable that we will all happily sell our bit of it, because it is a post-war block built in the 1950s, when building materials were scarce. It is not a glamour block, but next door three tiny houses have been demolished and a fabulous block has been built. It is nothing to do with the man who owns ours, but it is a private enterprise venture, and the cheapest apartment was £6 million. So the site must be hugely valuable. To the people living in the place it is no more valuable than when we bought it for, by comparison, pretty well nothing, but it changed our thinking completely: it is why we have gone for the right to manage, so that we can upgrade the conditions and protect the block.
I do not know whether that answers the point that the noble Lord, Lord Campbell-Savours, made. Would he like to respond on that?
Lord Campbell-Savours
The holder of the freehold to whom those leases are transferred must comply with the original leasehold agreement between the original freeholder and the leaseholders. You cannot simply arbitrarily change the lease. There must be, in the original lease provided by the freeholder when the block was originally purchased, provision to do the things that the noble Baroness is now objecting to. Maybe no one has read the original lease.
Baroness Gardner of Parkes
I thank the noble Lord for that remark. I do not want to prolong the debate on this but I am certainly pinning my faith on the right to manage. If we can get a more realistic percentage of how many people are required to do things under that right, then I have hopes on that point, too—and I have an amendment tabled later on it. Meanwhile, I note what has been said but the difficulty with local authorities is that they do not have the money to do any enforcement. That is their one complaint to me. Kensington and Chelsea was mentioned. Westminster had a team of six and sacrificed other things to have its properties checked, but Kensington and Chelsea does it only if there is real pressure and the situation becomes impossible, because it is short of funds for enforcement and very limited in what it can do.
Housing and Planning Bill
Debate between Baroness Gardner of Parkes and Lord Campbell-Savours
Baroness Gardner of Parkes
All the agreements for letting residential properties in this country are extremely complicated. In Australia, there is just one in New South Wales. I do not know about other states because there is not a federal law. In New South Wales, you just go into the local paper shop and pay $7.50. That is your letting agreement and everyone—big and small, rich and poor—abides by those. There is about an inch and a half in which you could type quite a lot of special agreed clauses but the rest of the format is a basic thing. It is so simple.
The point made by the noble Earl, Lord Lytton, that this amendment is rather overbalanced against the landlord is relevant and important. Are you going to create a different type of tenancy from the assured shorthold? What will you do in cases where the landlord dies and his family is obliged to pay all death duties in advance of getting probate? What will happen under those circumstances? If you must sell the property with a sitting tenant, of course you will not get anything like the full value. Will the Exchequer allow for that and value the property down accordingly, or will it be done on the open-market value of the vacant property? What would be the special provision where the tenant was not paying the rent and that had built up? Would that all be covered by a new type of tenancy agreement? There are so many complexities that we need to look at here, so this is rather badly balanced.
I think the noble Baroness, Lady Hollis, described people as being at the whim of bad landlords. I am sure that anyone who has a bad landlord is pretty unfortunate but there are so many honest, reliable landlords and, likewise, many good tenants who are happy. I know many people who have rented for years and are still in the same property after well over a decade, as was mentioned. There is a difference between that and the fact that the landlord is obliged to offer three years while the tenant can go any time at two months’ notice. That seems a bit extreme, one way or the other.
Lord Campbell-Savours (Lab)
My Lords, perhaps I can deal with the noble Baroness’s comment on what happens in the event that the landlord dies. This is an amendment moved by my colleague on the Front Bench, and if there is a difficulty with it there is no reason at all why the Government cannot come back with an amendment to deal with the thrust of the case laid in the amendments by my Front Bench but which includes a provision for those circumstances. That is what we are here to do: to legislate. These amendments have been proposed but Ministers could take them away and say, “Yes, there is a point here but if we build in a system of exemptions then these particular problems will not arise”.
I can also deal with the question of tenants in arrears, which the noble Earl, Lord Lytton, referred to. As I understand it, under Clause 55—in Part 3, which is headed “Recovering abandoned premises”—the Government’s position is actually to simplify the whole process of dealing with what happens where,
“the unpaid rent condition is met”.
That would cover where people are in arrears and where mortgages are being paid, as I presume that under that provision the landlord would then be entitled to secure possession of his property. That deals with one of the main objections in the contribution of the noble Earl, to which I listened carefully.
Finally, the noble Earl referred to people working at Gatwick Airport who did not necessarily need longer-term tenancies. The amendment says that,
“it is an implied term of such a tenancy that the tenant may terminate the tenancy by giving two months’ written notice to the landlord”.
The tenant is not locked into the agreement at all. The tenant can pull out of the agreement at a moment’s notice simply by saying, “I gave two months’ notice to the landlord”. What we are doing here is protecting tenants by not locking them in, in the sense that they can pull out. We are protecting landlords—or the Government are protecting them—under the provisions of Clause 55 in terms of arrears. In terms of landlords dying, as I said, that could be dealt with by further consideration by the Government.
However, what we are doing more than anything else is giving people who take on tenancies a sense of security as to where they live. From what I hear from tales brought to me by my sons’ friends, who have had different tenancies in London over a period of years, many tenants in London do not know where they are going to be. They do not know whether the landlord will want the property back at the end of 12 months. People are entitled to know that the weight is moving at least a little more in favour of the tenants to give them more rights. We are not granting people long-term security of tenure and indefinite tenancies. We are simply extending it from one to three years to give more balance to the way that tenancies operate in the United Kingdom.