Leasehold Reform (Ground Rent) Bill [HL]

Lord Berkeley Excerpts

Monday 24th May 2021 Lords Chamber

[Lord Berkeley (Lab)]

My Lords, I very much welcome this Bill. I am no property expert but I have explained my interest in the Bill—I hope, as other noble Lords have said, that there will be at least one more. I welcome the Government’s statement, I think from 11 January this year, accepting the recommendations to introduce legislation to allow residential leaseholders to extend their leases at zero ground rents for 999 years or to buy it out. This is welcome. Although this Bill does not cover that, it sets some useful pointers—I hope—on government thinking. I declare an interest as living in Cornwall and the Isles of Scilly.

To some extent, it seems that this Bill just covers the easy bits. I hope I am wrong about that, because the noble Lords who have already spoken raised some interesting issues that are way beyond my competence. My understanding—I am sure the Minister will correct me if I am wrong—is that this applies to new build, but does it cover conversions from shops or houses cut into several smaller bits? I suspect many people will wish for some element of retrospectivity in this, but that is probably impossible.

I will concentrate my remarks on Clause 23, which concerns the Crown lands of the Duchies of Lancaster and Cornwall. I am pleased to see that no exemptions are mentioned here. That is really good. However, there is potential for some people who might seek to delay or wriggle out of the spirit and letter of this Bill, which applies not only to this Bill but—hopefully—to the next one as well. I have been seeking assurances from the Duchies of Cornwall and Lancaster and the Crown Estate, for when it comes to the next piece of legislation, about the statements in paragraph 7.150 of the Law Commission report that

“the Crown has given an undertaking to Parliament that, in most cases, it will act ‘by analogy’ with the legislation to give its leaseholders the same rights that they would enjoy if their landlord were not the Crown.”

It goes on to suggest that the commitment is disapplied when the property is in or near

“historic Royal Parks and Palaces”

or has some

“long historic or particular association with the Crown.”

I have been writing to all these groups for comment. I noted that the Law Commission report states that many consultees had negative experiences in negotiating with the Duchy of Cornwall, compared to no problems with the others. I am sad to have to agree with them. I wrote to the Duchy in January asking for its views on this report and whether it intended to follow the examples of the Crown Estate and the Duchy of Lancaster. Four months later, I have not yet had a reply, in spite of several reminders. This leads me on to the situation that the Duchy claims to be in the private sector. My first question, then, is why it should be treated any differently to other private sector organisations.

But then we have the issue, which noble Lords know well, that Ministers have to seek the consent of the Prince of Wales and the Queen. From the Prince of Wales’s point of view, it is odd that the Duchy of Cornwall should have to give consent to a Bill in which it presumably has a commercial interest. Have the Government applied for consent in this case from the Duchy of Cornwall and the Crown? If so, what changes were made to the draft document as a result of either of these questions? This situation seems to be of such concern to some Ministers, and certainly to the Crown, that they do not like even to put this in writing; they have to do it by phone so that there is no record of it. Frankly, I find this pretty non-transparent.

But the Duchy is in a different position from that of the Crown Estates or the Duchy of Lancaster. As I have said, it claims to be in the private sector. But it has all these special privileges—such as Crown immunity, special tax status and free legal advice from the Treasury Solicitor—which other private estates do not enjoy. I think that the lawyers will be rubbing their hands in glee after some of the discussions in this debate today. But this is not the point. This Bill—and, I hope, the subsequent one—provides an opportunity to ensure that the Duchy behaves in the same way as the Crown Estates and the Duchy of Lancaster. All communications should be transparent, and it should not seek special privileges for its property in a manner which is out of line.

To conclude, I will give one example. Somebody I know very well lives in a Duchy-leased house in St Mary’s on the Isles of Scilly. There is nothing special about his house; it happens to be next door to a castle built by the military 200 or 300 years ago. I do not think the Duchy has any title to that at all, and it will not even discuss with him the idea that he could buy the freehold. His house is not historical; it is nothing very special. It is probably a 1960s building. This example is so that all these organisations can agree with what the Law Commission suggests in its report and have the minimum exemptions.

My final question to the Minister is: when do we expect the next Bill? He would expect me to ask that. I am sure he will not give me an answer, but it would be nice to know. I hope to explore some of these issues in Committee.