Leaseholders: Service Charges

Lord Kennedy of Southwark Excerpts

Wednesday 20th July 2022 Lords Chamber

Asked by

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what steps they propose to take to ensure service charges paid by leaseholders are fair and reasonable.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare my interest as a leaseholder.

[Baroness Bloomfield of Hinton Waldrist (Con)]

My Lords, by law, service charges must be reasonable and, where costs relate to work or services, the work or services must be of a reasonable standard. Leaseholders may make an application to the appropriate tribunal to challenge the reasonableness of their service charges. We are committed better to protect and empower leaseholders by giving them more information on what their costs pay for. This will help them to challenge their landlords more effectively if they consider their fees unreasonable.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, leaseholders are seriously disadvantaged in disputes with freeholders and management service companies about the service charges, ground rent or any other aspect of their tenure. The present arrangements are not fit for purpose. When will the Government take action on this matter?

[Baroness Bloomfield of Hinton Waldrist (Con)]

The Government do indeed recognise that the existing statutory requirements do not go far enough to enable leaseholders to identify and challenge unfair costs. The Government have said that they will take forward further legislation on leaseholds in the next Session.