Lord Best
Main Page: Lord Best (Crossbench - Life peer)
Lord Best
My Lords, it is a great privilege to bring this Bill before your Lordships. The Bill aims to end to some disgraceful practices which have been widespread in an industry with which few of us are familiar. If enacted, it will make a huge difference to the lives of thousands of largely forgotten people who currently live with the fear of harassment and ill-treatment at the hands of some unscrupulous bullies. Credit for this legislation goes to a number of people to whom we should all be very grateful. First, there is the noble Lord, Lord Graham of Edmonton, who has campaigned tirelessly in support of those living in mobile homes or park homes for over 30 years. I hope that today represents a gratifying milestone in a long journey he has taken to achieve justice for this group.
Then there are the Members in the other place who have also fought long and hard on this issue, including Annette Brooke MP and the other members of the Mobile Homes All-Party Parliamentary Group chaired by Christopher Chope MP. I think that a special tribute is due to Grant Shapps MP who, as Housing Minister, took up the challenge presented by the problems facing mobile home owners and, following an extensive consultation process by his department, really got behind the formulation of this legislation. However, none of these efforts would have brought us to the positive position we face today were it not for Peter Aldous MP, the honourable Member for Waveney, who used his place in the ballot for Private Members’ Bills to sponsor this Bill on mobile homes. Although I was hugely impressed by the unanimity of support for this Bill across party lines, piloting a Private Member’s Bill through the other place can represent an unpredictable and hazardous task. A great many Private Members’ Bills have fallen along the way, so I congratulate Peter Aldous who, with his experience as a chartered surveyor and his local knowledge as a constituency MP, so assiduously steered this Bill to a happy conclusion in the other place.
I must make special mention of the people living in mobile homes, who themselves have fought long and hard to achieve wider recognition for the problems that they face. I am personally grateful to Brian Doick of the National Association of Park Home Residents, who has been advising fellow owners on a voluntary basis for more than three decades on these matters and who kindly showed me around a number of sites and introduced me to many other residents; he has been a stalwart in all the campaigns for changes to the law in this field. I know that many others have also done sterling work, including the Independent Park Homes Advisory Service, the Park Home Owners Justice Campaign, the National Park Home Owners Congress and other resident associations and alliances. My final congratulations and appreciation go to the hardworking civil servants in the Department for Communities and Local Government, who have accumulated considerable expertise on these matters and have done sterling work in crafting the Bill now before us.
Not all noble Lords will be familiar with the mobile homes that are the subject of this Bill. These are static, immobile homes, often called “park homes”. They are not holiday homes, but provide permanent, residential, owner-occupied accommodation, mostly for retired individuals and couples. It is estimated that there are 85,000 park homes accommodating approximately 160,000 people on 2,000 sites. Homes may be worth anything from £25,000 to, I gather, £300,000. They are grouped together on pitches on land originally made available, very often, by a farmer who retained ownership of the site and provided services—looking after paths, drains and the supply of utilities, et cetera—in return for a combined ground rent and service charge, or pitch fee. As well as this revenue, the site owner is entitled to 10% of sales proceeds whenever one of the park homes gets sold.
At best, these mobile home sites have been described as “little paradises”, often in an idyllic country setting with a friendly site owner and a strong, mutually supportive community. But over recent years many of the original site owners, or their heirs and successors, have sold up and highly undesirable purchasers have taken their place. In these cases, residents have been exposed to exploitation in a number of ways: services are not undertaken, with drains left blocked; pathways are impassable; street lighting is out of action, and so on. Meanwhile, service charges or pitch fees are inexorably increased. Exorbitant fees are added to charges for Calor Gas and other brands of LPG, for use of a gas meter or for other supplies.
Worst of all, owners who want to sell have seen the sale blocked by the site owner, who can invoke the “approval of the buyer” rule. This sale-blocking takes the form of the harassment and intimidation of park homes residents by rogue site owners, who can make tens of thousands of pounds’ profit in these circumstances. The aim of the unscrupulous site owner is to prevent the mobile home being sold to anyone other than himself. Various tactics are deployed by the site owner to acquire these properties for trivial sums, often on the pretext that the mobile home is virtually worthless because of its age and condition. The site owner then resells for an enormous profit or replaces the existing home with a smart new version, which can be installed for a fraction of the new sale price.
When prospective buyers meet the site owner as part of the process of that owner approving any new purchaser, rogue site owners block the sale by scaring potential buyers, perhaps by telling them that the home is defective and will need to be demolished or that the site is to become a Gypsy site, with animals free to roam. He may leave piles of rubbish outside the home or even parade his own criminal background, all to deter any purchaser. In other cases, the whole of a park home site is worth more for redevelopment than in its current use and the site owner has sought gradually to acquire all the mobile homes—using every conceivable ploy to persuade current occupiers to leave—so that he can sell the land with vacant possession.
The Trading Standards Institute, which gives regular reports on these nefarious activities, talks of a “large number of cases” where unscrupulous operators, in pursuit of obscene windfall profits, have exploited the piecemeal regulatory framework. The institute illustrates the problem with an example from Cornwall’s trading standards service, which has pursued operators named Small who own approximately 17 park home sites. Other site owners are even bigger businesses, controlling up to 40 sites. What was once a cottage industry now has a turnover in excess of £1 billion per annum, with legal advisors and accountants able to exploit the many loopholes in the current law.
Can this Bill end all these malpractices? Can it drive out the gangsters and the rogues from this industry and restore the reputation of the decent, law-abiding site owners who continue to provide a good service? It can indeed go a very long way to ending the current exploitation of innocent victims. Let me spell out its key provisions.
First, the Bill recognises that local authorities are the agencies best placed to insist on and enforce decent standards of behaviour and performance by site owners. Here, I declare my interest as president of the Local Government Association. The Bill gives local authorities proper incentives and powers to require good practice by the owners of sites, while protecting the rights of those owners with proper provision for appeals against local authority decisions.
Currently, local authorities have to license park home sites but in reality this has been little more than a formality and, in any case, hard-pressed local authorities have faced a heavy financial disincentive to get involved with these cases. The Bill makes licensing a meaningful arrangement, requiring standards to be met. An annual fee will be required from the site owner, which is to be set by the local authority but is likely to be on average around £1,350 per annum per site, to pay for the council’s costs of administration. There will be serious sanctions where the terms of the licence are breached. If the site owner is aggrieved by the local authority’s actions in this regard, they can take the matter to the Residential Property Tribunal, which is given new powers in the Bill. Putting local authorities centre stage and giving them the resources to do the job is likely to make a significant difference to what goes on at these sites.
Clear new procedures will govern drawing up and maintaining the site rules for each park home site and the level of, and increases to, the pitch fees for services provided by the site owner, in place of the current irregular and often informal arrangements, which are open to abuse. In the case of disputes, the site owner will be subject to appeals to the Residential Property Tribunal, which has been doing good work in this field and whose powers are extended by this Bill. Clarity, transparency and fairness will be the watchwords. Local authorities will also be able to compel site owners to carry out necessary works to fulfil the obligations covered by their licence, and to insist on immediate action by serving notices requiring compliance. If work is not undertaken, the local authority can organise it and recover the costs from the site owner.
In relation to sale blocking, the aim is to prevent the site owner disrupting the sale process. This is best achieved by removing the direct contact that currently takes place between the obstructive site owner and all prospective buyers. The Bill sets out that two months after enactment, irrespective of what is said in the existing agreement between the site owner and the resident, the position of the site owner will change dramatically. There are two aspects to this change. A distinction has to be made between the position for existing occupiers and for those who have bought from existing occupiers. For the latter, when they come to sell, the site owner will have no say at all in the process. For existing occupiers with agreements in place, the position is slightly different.
There were worries that if existing agreements were subject to too much change, objections could be made that the legislation was retrospective or that it might offend the human rights of park owners—including, of course, blameless park owners—provoking the ire of those in another place who could have impeded its passage. However, this does not mean that the Bill does nothing to overcome problems of sale blocking for existing park home owners. On the contrary, the position will change significantly after enactment of the Bill: the site owner will no longer be involved in meeting any prospective purchaser nor is the owner’s permission required to assign the agreement when the sale is about to be completed. The only information they will be entitled to receive about potential buyers is their name and, if the site has rules, certain information to be prescribed in regulations. For example, if the site is exclusively for those over pensionable age and that is clear in the site rules, it may be legitimate for the site owner to require information on the buyer’s age.
If a site owner wants, for any reason, to block a sale, he will be able to do so only by going, within 21 days, to the Residential Property Tribunal, and only on grounds prescribed in regulations by the Secretary of State. If the RPT finds the site owner guilty of deliberately and unnecessarily holding up the sale to the detriment of the homeowner, it can award compensation.
In terms of legal redress, as from February 2014 when the licensing provisions come into force, magistrates’ courts will—assuming that Section 85 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 has been brought into force—have the power to impose unlimited fines for failure to comply with licensing requirements, including failure to carry out works under a compliance notice. If the local authority does the works in default, its costs will be recoverable from the site owner and, until paid, will be a charge on the site owner’s land.
Meanwhile, a new offence is introduced by the Bill—that of knowingly making a false statement with reasonable cause to believe that this will have the effect of causing a person who is considering whether to purchase or occupy a mobile home to decide not to do so. This will also carry an unlimited fine, six months’ imprisonment or both. In other words, sale blocking could lead to fines of tens of thousands of pounds and a jail sentence. These are tough measures intended to stop and deter bad practices.
What of the omissions in the Bill? What are the additional legislative changes that have been recommended by others, for example in the excellent report of the Communities and Local Government Committee of last June and the very helpful Consumer Focus report, Living the Dream, of last October? The two areas that deserve further action are, first, the requirement for site owners to pass a fit and proper person test; and secondly, for measures to ease problems of fuel poverty and exploitation in supplying fuel on park home sites.
In relation to the opportunity to refuse a licence for an unfit operator, for example those with a criminal record and/or those who have been convicted of offences specifically relating to their position as owners or managers of a site, the Communities and Local Government Committee was clear that a fit and proper person stipulation should be introduced. The Bill gives powers to the Secretary of State to introduce by way of secondary legislation just such a requirement. Regrettably, there are ways in which devious operators can hide behind a network of companies or switch the ownership and management of parks between family members. Establishing the true position and policing it would not be a trivial matter. The Government have made clear that they will not impose a duty to instigate and enforce a requirement for the manager of a site to be a fit and proper person in the immediate future, but that this provision in the Bill will be used if it becomes clear that this is an essential ingredient in improving the industry. The expectation is that that Secretary of State, if this seems the way forward following a review in 2017, will use the new power and it is an important component of the legislation.
In relation to issues concerning energy efficiency and fuel poverty, mobile home owners are in a difficult position. The insulation and heating standards of these dwellings are low and the new Green Deal measures do not apply to park homes. Measures outside the Bill are being pursued with the Department for Energy and Climate Change but, sadly, cannot be wrapped up in this Bill. However, I know that reforms are being taken forward in other fora, not least by Peter Aldous MP in the other place.
The Bill does not end all the deficiencies in the current arrangements for protecting and supporting park home owners, but it goes a very long way. It is a tribute to all those who have devoted endless days, weeks or even years to combating unscrupulous site owners who, until now, have been able to get away with atrocious behaviour. The Bill is a very fine example of the way in which Parliament can seek to right a wrong, end an injustice and secure a better life for many thousands of households. I strongly commend it to your Lordships. I beg to move.
Lord Best
My Lords, I am grateful to noble Lords on all sides of the House who have spoken in support of the Bill. I am very grateful to the noble Lord, Lord Cormack, not only for his practical examples that bring to life these issues but for the passion with which he delivered his words. I am grateful, too, to the noble Lord, Lord Whitty, who raised the question of “fit and proper person” and pointed out that the Welsh Assembly is looking at these matters even as we speak and might go further than has been possible in this case. The noble Baroness, Lady Scott, also raised that issue.
I support the Government in putting this matter not on the back burner but on the edge of the back burner, ready to be brought forward if needed. It is quite an undertaking for government to require local authorities to ensure that people are fit and proper persons when we know that some of these devious individuals are able to swap the ownership of their sites. We know that some of them have companies—more than one—registered in the Cayman Islands. These are not entirely unsophisticated operators. Keeping tabs on everything that is happening and enforcing a duty to ensure that only fit and proper persons should operate on these sites is a big step, but one that the Government are prepared to take if it proves necessary in due course.
I was very grateful to the noble Baroness, Lady Scott, for the various points that she made, bringing to the debate her experience as a local councillor, which was an important extra dimension for us. I hope that she was satisfied with the timetable that the Minister indicated. It was an amendment in the House of Commons that brought forward the timetable for implementation of the first chunks of the legislation—I shall not say breakneck speed—to two months after Royal Assent. The civil servants will be kept busy getting that to happen.
We then heard from the noble Lord, Lord Graham of Edmonton, who made a wonderful speech. I know that we all feel a deep sense of gratitude to him for putting so much time and effort over so many years into making things happen today. He was described to me by one park owner as “diamond”. “Dogged” is another word that I would have added to that list. I thank him so very much for all the work he has done over so many years on behalf of park home owners.
I am grateful to the noble Lord, Lord McKenzie, for the support of the opposition Benches, which was incredibly important for seeing this through. There is more work to be done in explaining to everybody what the position will now be, including park home owners, the legal profession, citizens advice bureaux, police forces, trading standards officers and site owners themselves, who will need to know where they stand in the future. I am confident that the excellent team at the Department for Communities and Local Government will get on with this and do it very well.
I am very grateful for the personal support of the Minister and the Government as a whole. Her support is important: she was able to remind us today—if we had not spotted it earlier—that the Prime Minister is now taking an interest in ensuring that some aspects of this are now taken forward. There will be other reforms relating to the Green Deal and energy saving which will also be important and can be taken up in other fora. There is work to be done to ensure that the Bill, when enacted, has the impact it should, but the stage is now set for a new era for park home owners. I am grateful for all the support from your Lordships in taking this Bill forward to its next and final stages in this enormously worthwhile exercise. I ask the House to give the Bill a Second Reading.