Leasehold Reform (Ground Rent) Bill [HL]

Baroness Jones of Moulsecoomb Excerpts

Monday 24th May 2021 Lords Chamber

[Baroness Jones of Moulsecoomb (GP)]

My Lords, I declare an interest as a vice-president of the Local Government Association. It is of course a pleasure to follow the noble Lord, Lord Blencathra. I will sign his amendment to make all ground rents peppercorns, so I ask him to get it tabled as soon as possible.

Many years ago, when I was on the London Assembly and sitting on the housing committee, an officer from Newham Council said that there are many more incompetent amateur landlords than rogue landlords, and plenty of rogue letting agents managing properties poorly on their behalf. In fact, the noble Earl, Lord Lytton, said that much more forcefully. Personally, as a feudal serf of Lambeth Council—albeit that I own my flat, to which it holds the leasehold—I would like to say that not all leaseholders are incompetent; Lambeth Council is superb.

But when we do have rogues and incompetents, councils are hopelessly underresourced to tackle them. I am concerned that the Bill adds more statutory enforcement powers to local authorities without any corresponding increase in funding for them to carry out those functions. Enforcement officers are inevitably faced with choices about which issues to prioritise and will usually have to focus on the worst cases. I noted what the Minister said about being able to recoup costs and that sort of thing, but that sounds to me like a complete failure. The Government need to start seeing housing enforcement as an investment in levelling up the country’s housing stock. Those bad or incompetent landlords act as a drag on our housing. They suck up scarce housing supply, they fail to invest to maintain it and then they sell it back to renters at unjustifiable rates. Local authorities are on the front line in tackling that problem but, without a significant uplift in their resources, they will continue to struggle.

Ground rents on long leases are inherently exploitative, and the Bill recognises that. The noble Lord, Lord Blencathra, called it a timid Bill. I sense that he will probably not vote against it, but the fact is that it needs updating and improvement. It acts only on future leases, as other noble Lords have mentioned. We need to think about what will happen to leases that people are tied into that could last anywhere from 100 to 1,000 years. People are already seeing spiralling ground rents. Although there is a legal process to challenge this, it is quite difficult. For example, there are supermarket companies which own the land on which a block of flats is built, with the supermarket on the ground floor. We have seen cases where the supermarket then uses the leases of the flats as cash machines to fund improvements that really benefit only the supermarket company and, because they have some negligible benefit to the owners of the flats, it becomes very difficult to challenge. It is wrong for people’s homes to be used to subsidise big business like that.

There is a notable exception to this exploitation of leaseholders, and I am very pleased that the Government have included it as an exemption in the Bill. That is the exemption for community housing leases where the landlord is a community land trust or a co-operative society. That is an excellent thing to put in the Bill. As community land trusts and co-operatives exist to serve their community and their members, the usual exploitative nature of the landlord/tenant relationship falls away. There are housing models that should be encouraged, and I should be very happy if the Minister would share his thoughts and plans to support community land trusts and co-operatives to tackle Britain’s housing crisis.

I must say that I am really looking forward to Committee, because noble Lords who have already spoken in this debate brought up a host of issues that will clearly mean a lot of wonderful amendments to the Bill to make it the best Bill it could possibly be—and obviously that will be very exciting.