Holocaust Memorial Bill

Lord Khan of Burnley Excerpts

2nd reading
Wednesday 4th September 2024 Lords Chamber

Moved by

[Lord Khan of Burnley]

That the Bill be now read a second time.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)]

My Lords, many noble Lords will be familiar with the Bill we are debating today and will remember that it was previously introduced in the previous Parliament. We have reintroduced the Bill for the same purpose that it was first brought forward by the previous Government: to help ensure the victims of the Holocaust will never be forgotten.

This horrendous crime—the murder of 6 million Jewish men, women and children—was an attempt by the Nazi state to eliminate an entire people. If we are to honour those families, communities and individuals, we must constantly ask ourselves: how did it come about? What was the context within which such hatred could grow? How did it happen that people could turn with such violence upon their neighbours? What led a Government to plan and execute the murder of millions?

A new national memorial to the Holocaust, with an integrated learning centre, will enable future generations to ask and answer those questions for decades to come. It will be a focal point for remembering the 6 million Jewish men, women and children, and all other victims of Nazi persecution, including Roma, gay and disabled people. That is why we supported the Bill in Opposition and are promoting it today.

I want briefly to explain how we arrived at this moment, and pay credit to all those who supported the project until this point. In particular, I thank those involved in the work of the Holocaust Commission, launched by the noble Lord, Lord Cameron of Chipping Norton, when he was Prime Minister. It was the recommendations of that commission, set out in its 2015 report, which called for a

“striking and prominent new National Memorial”,

which should be

“co-located with a world-class Learning Centre”.

In the years since, the UK Holocaust Memorial Foundation has done extensive work to find a suitable location. Since Victoria Tower Gardens was identified and the design team of Adjaye Associates, Ron Arad Architects and Gustafson Porter + Bowman was appointed, the project has consistently benefited from strong cross-party support. Since 2018, that support has, of course, been led by the noble Lord, Lord Pickles, and the right honourable Ed Balls through the UK Holocaust Memorial Foundation, building on the work of the commission, which itself received almost 2,500 responses to its call for evidence.

The design of the Holocaust memorial and learning centre is itself the product of an international competition, with hundreds attending the exhibitions of the short-listed entries and then the winning design. A detailed planning application was then submitted to Westminster City Council at the end of 2018, with around 4,500 comments submitted online. Then, the 2019 call-in by the Minister led to a planning inquiry, chaired by the inspector, which received almost 70 oral representations. Throughout this process, views have been properly considered, and will continue to be properly considered as future decisions are taken.

In this time, the project has benefited from the support of academics, including Michael Berenbaum and Professor Stuart Foster; teachers and educators such as Ellie Olmer and Martyn Heather, the director of education for the Premier League; religious leaders, including both the Chief Rabbi and the most reverend Primate the Archbishop of Canterbury; and, of course, the voices of many Holocaust survivors.

I also stress that I accept there will never be universal support, and I want to assure the House that, for those who oppose the project, I will always be available to listen to, engage with and respect any concerns about this Bill. Indeed, I note that the noble Baroness, Lady Deech, has tabled a regret amendment that the Bill does not include certain provisions or deal with particular issues. This brings us neatly to an explanation of the Bill’s provisions, following which I will pick up on the points that the noble Baroness raises in her amendment.

The Bill is before the House to provide parliamentary authority for spend on the project and to address the view of the High Court, which said that Section 8 of the London County Council (Improvements) Act 1900—the Act which saw the creation of Victoria Tower Gardens in more or less its current form—is an obstacle to construction. Clause 1 seeks powers to enable the Secretary of State to provide funding for the construction, maintenance and operation of a Holocaust memorial and learning centre. It is a long-standing convention that Ministers should have adequate and specific legal authority to commit funds to significant new activities.

Clause 2 seeks to address the statutory obstacle inherent in the 1900 Act. I would like to spend a few moments explaining precisely what Clause 2 does and does not aim to achieve. The clause, if enacted, would provide that the 1900 Act should not be a barrier to the construction or operation of the Holocaust memorial and learning centre. The clause does not seek to repeal any part of the 1900 Act. I want to make clear that we are not seeking to overturn the guarantee that Parliament gave 124 years ago that Victoria Tower Gardens should remain protected,

“as a garden open to the public”.

The Government remain firmly committed to retaining and, indeed, improving the gardens, ensuring that all users of the gardens can continue to enjoy them. There will, of course, be some loss of space as a consequence of building the memorial, but the remaining area is more than 90% of the current space. Visitors to that 90% of the gardens will, as a result of this project, enjoy improved lawns with better drainage, more varied planting, more accessible seating and new boardwalks alongside the River Thames.

Clause 3 deals with extent, commencement and the Short Title.

In the previous Parliament, the House of Commons made clear that it wished the Bill and the project to proceed. We now have the opportunity in this House to give the same clear message. I am delighted that, as a new Government, we can also make very clear our support for this project. I confirm that the Deputy Prime Minister and Secretary of State will continue to promote the planning application put forward by her predecessor to ensure that it is built.

It is important to note that this Bill does not provide powers to build the Holocaust memorial and learning centre. Planning consent must be obtained through the separate statutory process, which takes full account of the need to assess in detail all aspects of any development and to hear from both supporters and opponents. I have already referred to the consultation carried out as part of the planning process, one of the topics the noble Baroness, Lady Deech, asks in her Motion for the Bill to cover. Similarly, the process for site selection and appraisal and all matters relating to security have been scrutinised through the planning process, including at a public planning inquiry.

On project costs, a statement of expected costs was published by the then Government at Second Reading of the Bill. Forecast costs will continue to be reviewed and agreed with the Treasury in the normal way.

I will endeavour to respond in more detail in my closing speech to these and other points made by noble Lords in the course of the debate.

The proposal for a Holocaust memorial and learning centre at Victoria Tower Gardens will demonstrate the significance of the Holocaust to the decisions we take as a nation. I referenced Holocaust survivors earlier and, as I finish, I want to tell the House about a personal motivation for why I am so keen to see that the memorial is built. Throughout my life and the lives of Members of this House, we have all heard direct, first-hand accounts of the Holocaust from those who were there. They are stories which were often deeply painful to relate but were told by survivors who knew the importance of sharing their testimony. Sadly, the opportunity to hear first-hand testimony will not be available for future generations. Each year, we are losing more and more Holocaust survivors. Last year, Holocaust survivor and staunch supporter of the project Sir Ben Helfgott died, and we know that not seeing the Holocaust memorial and learning centre built in his lifetime was a great sadness to him. Earlier this year we saw the passing of Henry Wuga MBE and Hella Pick CBE, who both escaped Germany on the Kindertransport and made their homes here. For those courageous survivors who fear that attention will fade after their departure, the Holocaust memorial and learning centre provides strong reassurance.

The history of the Holocaust will always be important to Great Britain, and in an age of increased disinformation and misinformation, this memorial and the learning centre will mean that history continues to be told, and respected, long after its witnesses are no longer with us. As the great-grandson of a 100 year-old survivor, Lily Ebert, said

“When we no longer have survivors like Lily among us, this memorial will help to ensure that their experience is never forgotten. We can create the next generation of witnesses”.


I beg to move.

--- Later in debate ---

[Lord Khan of Burnley (Lab)]

My Lords, I am grateful to noble Lords from across the House for their powerful contributions on this important Bill. It is heartening to hear cross-party support from across the House, but I also want to recognise the strong feelings, for and against, and respond to the concerns raised by noble Lords. Given the lengthy consultations and public inquiry that have taken place over the past decade, many of these concerns have been responded to previously, but I want to take time to go over a few of the specific points made.

On a broader point, I first draw attention to the planning inspector’s conclusion that the civic, educational and social public benefits of the proposal “outweigh the identified harms”. I also want to reference the separate process for the designated Minister to consider next steps in retaking the planning decision, which is a completely separate process from the Bill. On that, I can tell the House that arrangements are in place within the department so that the designated Minister remains isolated from the Holocaust memorial project and can make planning decisions in a fair, transparent and unbiased way.

As this is a hybrid Bill, there has also been an opportunity for those who are directly and privately affected to petition against it, and for those petitions to be considered by a Select Committee, both in the House of Lords and in the other place. In the Commons, the Select Committee heard eight petitions and decided not to amend the Bill. Eighteen petitions have been received in the Lords and will be referred to a Select Committee for consideration following this debate. Those opposed to the planned Holocaust memorial and learning centre have had every opportunity to make their comments known.

Moving on to specific concerns that were raised, the noble Baronesses, Lady Noakes and Lady Bottomley, the noble Lord, Lord Carlile, the right reverend Prelate the Bishop of St Albans, the noble Viscount, Lord Craigavon, the noble Lords, Lord Howarth, Lord Sandhurst, Lord Strathcarron and Lord Sassoon all talked about the security risk, as did the Opposition Benches. The Holocaust memorial and learning centre will have security arrangements similar to many other public buildings in Westminster. We are working with security experts, the National Protective Security Authority and the Metropolitan Police to ensure that the site has the necessary level of security measures.

Based on this expert advice, physical security measures will be incorporated into the memorial and landscaping which will meet the assessed threat. Expert advice has also informed our proposed operational procedures, which will be reviewed and updated routinely in response to current threat assessment.

Full security information was submitted as part of the planning process, but in the interest of safety and security it was not included in the public planning information. It would be completely unacceptable to build the Holocaust memorial in a less prominent location simply because of the risk of terrorism, a point made by many noble Lords. That would amount to allowing terrorists to dictate how we commemorate the Holocaust, as many noble Lords said.

Noble Lords will understand that there are good reasons why the details of security arrangements cannot be shared widely. We have relied and continue to rely on advice from the appropriate security experts. Nevertheless, I recognise that the noble Lord, Lord Carlile, has a great deal of expertise in these matters and he is absolutely right to draw attention to the need for proper security arrangements. I will be very happy to arrange a private briefing for the noble Lord with members of the project team to discuss the security arrangements we are proposing. My office will be in touch with him soon.

A number of noble Lords alluded to the content of the learning centre, including the noble Lords, Lord Mann, Lord Goodman, Lord Blencathra, Lord Austin and Lord Verdirame, the noble Viscount, Lord Craigavon, and the noble Baroness, Lady Fox. The exhibition will confront the immense human calamity caused by the destruction of Jewish communities and other groups. The learning centre will also address subsequent genocides in Cambodia, Rwanda, Bosnia and Darfur. The exhibition will examine the Holocaust through British perspectives, looking at what we did and what more we could have done to tackle the murder and persecution of the Jewish people and other groups. The content for the learning centre is being developed by a leading international curator, Yehudit Shendar, formerly of Yad Vashem, supported by an academic advisory group, to ensure that it is robust, credible and reflects the current state of historical investigation into and interpretation of the Holocaust.

Noble Lords across the House—including the noble Baronesses, Lady Noakes and Lady Bottomley, the noble Lords, Lord Kerr, Lord Strathclyde, Lord Balfe, Lord Inglewood and Lord Sassoon, and the noble Viscount, Lord Eccles—asked why Victoria Tower Gardens was chosen. Victoria Tower Gardens was identified as a site uniquely capable of meeting the Government’s aspiration for the national memorial and learning centre. It is close to buildings and memorials that symbolise our nation and its values. It is the most fitting location in terms of its historical, emotional and political significance, and its ability to offer the greatest potential impact and visibility for the project. The view of Parliament from the memorial will serve as a permanent reminder that political decisions have far-reaching consequences. It will encourage all UK citizens, and visitors of all nationalities, to reflect on the lessons of the past.

The noble Baroness, Lady Deech, and the noble Lords, Lord Howard, Lord Howarth and Lord Black, spoke about the adverse impact on the park, trees and playground. The design is sensitive to the heritage and existing uses of Victoria Tower Gardens. It uses approximately 7.5% of the area of Victoria Tower Gardens, while making enhancements to the remainder of the park that will help all visitors, including better pathways and improved access to existing memorials. The memorial will be positioned to minimise the risk of damage to tree roots, and great care will be taken with the trees during construction. The play area will be retained and redesigned to make better use of the space and a more attractive play environment.

Many noble Lords across the House alluded to the issue of size. The figures of 7.5% for open space loss and a 15% reduction in green space were calculated using architects’ scale drawings of the site. A detailed breakdown of these figures was published in April 2023 in response to a Parliamentary Question from the noble Baroness, Lady Deech, and supporting documents were placed in the Library of the House. It was a matter of common ground between parties at the planning inquiry, as noted in the inspector’s report at paragraph 15.79, that the actual loss of open space, principally as a consequence of the entrance pavilion and courtyard, was 7.5%. Extensive information about the Holocaust memorial and learning centre, considered at the planning inquiry, remains publicly available on Westminster City Council’s website.

On the points made about the increase in traffic, the majority of the visitors to the memorial are expected to be visiting the local area and arriving by bus or tube, with just a short additional walk along Millbank to the memorial. We estimate that there will be 11 coaches per day, using a proposed coach bay on a quieter section of Millbank, which will minimise disruption to traffic and pedestrians. Coaches will use these bays only to drop off and pick up passengers, not to park while visitors are in the exhibition.

The noble Baronesses, Lady Pinnock and Lady Noakes, referred to consultation regarding potential sites. The UK Holocaust Memorial Foundation engaged with a wide range of organisations, including the Royal Parks, Holocaust commemorative and educational organisations and London boroughs, as well as directly commissioning the advisers to identify potential sites. The foundation also published a document, National Memorial and Learning Centre: Search for a Central London Site, inviting all interested parties to put forward expressions of interest. General public consultation was not carried out at the stage of recommending a preferred site because at that point, there were no clear proposals for what a memorial would look like and how it would sit within Victoria Tower Gardens.

A number of noble Lords, including the noble Lords, Lord Strathclyde, Lord Howell and Lord Sandhurst, mentioned the possible adverse effect on the Buxton Memorial. The planning inspector concluded that the development will not compromise the outstanding universal value of the world heritage site. The Buxton Memorial will be kept in its current position; the views of it will be preserved, and new landscaping and seating will be added to improve the setting, viewing experience and accessibility. The Holocaust memorial will be no higher than the top of the Buxton Memorial. The memorial’s bronze fins step down progressively to the east, in visual deference to the Buxton Memorial, where they are closest to it.

On cost, an issue raised by the noble Viscount, Lord Eccles, the noble Lords, Lord Lisvane, Lord Goodman and—

[Lord Lee of Trafford (LD)]

During construction, where will the access point be for all the lorries that will take out the soil and the debris and bring in the building materials? The Minister has not answered that question.

[Lord Khan of Burnley (Lab)]

I will address the noble Lord’s individual concern after I talk about the more specific concerns.

Updated costs of £138 million were published in June 2023, so that Parliament and all interested parties could have a complete picture ahead of important debates on the Holocaust Memorial Bill. It is deeply regrettable that delays to the programme have led to increased costs. With construction price inflation at high levels, the delays arising from the High Court’s decision to quash planning consent have inevitably added to the programme costs.

The noble Lord, Lord Russell, talked about the scope of the hybrid Bill and the Select Committee. The Bill does not include powers to construct the memorial and learning centre but deals with a narrow point in the London County Council (Improvements) Act 1900 that was found to be an obstacle; it focuses on that in particular. Had the Select Committee considered matters that fall within the scope of the planning decision-making process, it would have risked important matters being addressed in a partial and potentially unfair manner, in particular risking that the voice of supporters of the Holocaust memorial and learning centre would not be heard.

The noble Baroness, Lady Pinnock, asked how the design was decided. There was a competition, and 10 design teams were shortlisted, with 92 entries, in 2017. It was announced that Adjaye Associates, Ron Arad Associates, and Gustafson Porter + Bowman were the winning team. On the concern of the noble Baroness, Lady Deech, about the allegations against Sir David Adjaye, I note that Adjaye Associates stated that Sir David will not be involved in the UK Holocaust Memorial Foundation project until the matters raised have been addressed.

The noble Baronesses, Lady Pinnock and Lady Deech, and the noble Lord, Lord Lisvane, talked about public consultation not being enough. Ahead of the planning application, public consultations were held to gather feedback from local residents and the wider public. Around 4,500 responses were submitted to the planning application and, at a publicly held planning inquiry, many people spoke for and against the proposals. Planning processes ensure that all affected parties have the chance to make their views known on proposed developments, including this proposal. Consultation on the Holocaust memorial and learning centre has been extensive and thorough.

To the noble Baroness, Lady Scott of Bybrook, I say that the construction phase is expected to last three years, with a further six months for fitting out. Provision has been made to ensure that as much of Victoria Tower Gardens as possible is open to users during construction works. This includes the riverside walk and the northern area of grass around the “Burghers of Calais” and up to the Houses of Parliament perimeter. The team will engage with specialist contractors from an early stage to ensure that works are well planned and disruption minimised.

The noble Baroness, Lady O’Loan, and the noble Lord, Lord Lisvane, referred to the National Audit Office’s July 2022 report on the project. We welcome that the National Audit Office has addressed all its recommendations. It recognised the challenges we face in managing cost pressures in the context of inflation across the construction sector and of disappointing delays arising from opposition to the planning application. It is important to say that the National Audit Office also recognises that governance arrangements are in place. The strategic benefits of the programme have been clearly identified and specialists with the necessary skills have been recruited to the programme.

A flood risk assessment concluded that Victoria Tower Gardens is heavily protected by the Thames river flood defences, significantly reducing the risk of flooding on site. The UK Holocaust memorial and learning centre will include rainwater attenuation measures and improvements to the surface water drainage within Victoria Tower Gardens.

Our aim is for the completion of the memorial to be witnessed by Holocaust survivors—a very important point that a number of noble Lords made and that the noble Baroness, Lady Scott of Bybrook, summarised on behalf of the Opposition. Subject to the Bill passing and planning permission being regained, we aim to begin construction in 2025 and to open in 2029. It is a source of deep regret that delays to the programme will mean that fewer Holocaust survivors will have the experience of seeing the memorial open in their lifetime.

On the impact of visitors, our projections are that, based on the number of people visiting Westminster, the maximum number of visitors to the memorial will be around 500,000 per year.

A number of noble Lords, including the noble Lord, Lord Mann, and the right reverend Prelate the Bishop of St Albans, talked about work in relation to the restoration and renewal programme team. The team met regularly to share information and co-ordinate plans to reduce potential impacts. The memorial site is at the southern end of the gardens and need not prevent the use of the gardens by the restoration and renewal programme. Subject to the Bill being passed and obtaining planning consent, we expect construction in 2025, as mentioned. Parliamentary works to the Victoria Tower are expected to start then, and more comprehensive restoration and renewal works are subject to the approval of Parliament and costed proposals in 2025.

A number of noble Lords asked why we could not build at the Imperial War Museum. Victoria Tower Gardens was identified as a site uniquely capable of meeting the Government’s aspiration for the national memorial. The Imperial War Museum has endorsed our proposal, as has been mentioned. Matthew Westerman, the former chair of the Imperial War Museum’s board, is a member of the UK Holocaust Memorial Foundation. We will continue to talk with the Imperial War Museum about our plans. The learning centre’s exhibition will serve a different though complementary purpose to the Imperial War Museum’s Holocaust gallery. We are confident that the project will add to the excellent existing provision on Holocaust education.

The learning centre will provide essential context to the memorial. The Holocaust Commission recommended that a new world-class learning centre should physically accompany the new national memorial. The learning centre will provide the opportunity to learn about the Holocaust close to the memorial, helping people to better understand how the lessons of the Holocaust apply more widely, including to other genocides.

The Government believe that young people should be taught the history of the Holocaust and the lessons that it teaches today. In recognition of its importance, the Holocaust is the only historic event that is compulsory within the national curriculum for history at key stage 3. Effective teaching about the Holocaust can support pupils to learn about the possible consequences of anti-Semitism and other forms of extremism. It is right that we also build this Holocaust memorial as a focal point for national commemoration and to demonstrate our commitment to ensuring that its lessons are never forgotten.

A number of noble Lords talked about the alarming rates of increasing anti-Semitism since 7 October in particular. Anti-Semitism has absolutely no place in our society, which is why we are taking a strong lead in tackling it in all its forms. Making sure that British Jews not only are safe but feel safe is one of our top priorities. The Government have committed further funding of £54 million to the Community Security Trust to enable it to continue its vital work protecting UK Jewish communities until 2028. That brings total funding for the Jewish community protective security grant to £72 million over the next four years.

Memorials alone cannot prevent anti-Semitism, but this memorial will play a part in reminding everyone where anti-Semitism can lead. It will be a reminder to us all, in Parliament and across the whole nation, of the potential to abuse democratic institutions to murderous consequences, and it will challenge us to stand up and combat racism, hatred and prejudice wherever they are found.

On the point made by the noble Earl, Lord Effingham —I welcome him to his place—the play area will be retained and redesigned to make better use of its space and a more attractive play environment. This will allow only a modest loss because of the project.

The noble Lord, Lord Lee, talked about the views of UNESCO, Historic England and others being considered at the planning inquiry. The planning inspector concluded that the development would not compromise the outstanding universal value of the world heritage site. On the comment by the noble Lord, Lord Howard, who said that the design was off the shelf, the memorial design was created specifically for Victoria Tower Gardens.

I just want to pick up some important points that the noble Lord, Lord Austin, talked about and the questions that he asked. Everything will be done to complete the project as quickly as possible, consistent with safety.

The noble Viscount, Lord Craigavon, talked about the learning centre being only digital. We will work with leading producers and designers to create a very powerful and informative digital exhibition. The noble Baroness, Lady Harding, talked about making full use of digital technology to enable young people across the country to learn more about the Holocaust and take advantage of the impressive new learning centre, showcasing the excellent work of the many other Holocaust education organisations.

I want to finish off with some brief comments. The High Court quashed planning consent on the basis that the London County Council (Improvements) Act presented a statutory obstacle to building in Victoria Tower Gardens. This is what we are debating today. The Bill seeks to remove the obstacle by providing that Section 8 of the 1900 Act should not prevent construction or operation of the memorial and learning centre. The aim is to clarify the position before a new decision can be taken by the designated Minister.

The planning application remains current and a new decision on it will be taken. Arrangements are in place within the department, as I said before, so that the designated Minister remains isolated from the project and can make planning decisions in a fair, transparent and unbiased way.

I close by thanking noble Lords across the House for their contributions in this important debate and for their support to deliver on the Government’s commitment, which is long overdue. As Holocaust survivor Susan Pollack said recently:

“I am 93 years old. My dream is to see this memorial and learning centre finally built and to see the first coachload of school children arrive and ready to learn. That is what it is all about. And, hopefully, those students will learn what happened to me and become beacons of hope in the fight against contemporary antisemitism”.


The Holocaust memorial and learning centre will draw on the history of the Holocaust to stress the importance of tackling intolerance and hatred at all levels. It will be a memorial that delivers this message for all people across the UK and the rest of the world, regardless of faith and background. We must lose no more time in building a Holocaust memorial and learning centre of which we can all be proud. I repeat the words of the noble Baroness, Lady Harding: it is shocking that, in 2024, we do not have a national memorial. Who we memorialise matters and what we memorialise matters. In the words of the noble Lord, Lord Cameron of Chipping Norton, the former Prime Minister, it is the right idea, in the right place, at the right time. I commend the Bill to the House.

Social Disorder

Lord Khan of Burnley Excerpts

Wednesday 4th September 2024 Lords Chamber

[Lord Sikka]

To ask His Majesty’s Government what assessment they have made of the possible links between social disorder in major cities, and economic and social policies.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)]

My Lords, there is no excuse for violent disorder. The thuggery of a few contrasts with the inspiring unity that we have seen in response, with communities pulling together to rebuild after the violence. However, we must not ignore the fact that this violence occurred in places with broader social and economic challenges. In response, MHCLG is leading cross-government efforts to help places recover, working in partnership with communities and local stakeholders to rebuild, renew and address the deep-seated issues.

[Lord Sikka (Lab)]

My Lords, I thank the Minister for his Answer. Social disorder is the outcome of despair arising from real wage cuts, poor housing, corporate profiteering, the erosion of living standards and the destruction of public services. That anger cannot be addressed by policing. Does the Minister agree that it requires a redistribution of income and wealth, direct state investment in public services, curbs on corporate profiteering, and the building of community centres, youth clubs and libraries? If so, when will we see the tangible results?

[Lord Khan of Burnley (Lab)]

Government policy plays a key role in supporting thriving and resilient communities. Under the Conservative Government, however, we saw a lack of investment in local authorities and public services. That has left our communities more vulnerable to cohesion challenges and wider economic and social deprivation challenges. The recent Khan review into social cohesion and resilience highlighted that communities with lower levels of cohesion were less resilient to the threats of extremism. The review called for a more institutionalised and coherent approach to social cohesion to address these issues. I reassure my noble friend that work is under way in my department to develop a stronger approach to support our communities and build resilience against challenges.

[The Earl of Devon (CB)]

My Lords, the riots were deplorable and their perpetrators and instigators are criminals. Those criminals feed on a real fear, however, and a dangerous sense of dislocation among those who consider themselves our traditional indigenous English population. At a time of such social dislocation, is it wise for His Majesty’s Government to be assaulting the traditional fabric of this Parliament and our constitution by reforming this House?

[Noble Lords]

Oh!

[Lord Khan of Burnley (Lab)]

My Lords, the Government were elected on a manifesto that stressed a partnership approach with local authorities and an intention to stabilise the funding system through multiyear funding settlements. In a meeting with England’s metro mayors on 9 July, we put into action our plan to work hand in hand to spread better opportunities and transfer power out of Westminster into the hands of elected local leaders. Local places will rightly seek clarity on funding commitments in relation to the challenges ahead.

[Baroness Blower (Lab)]

My Lords, since 2010, 1,200 council-funded youth clubs, 800 libraries and hundreds of local community centres, children’s centres and leisure centres have closed. Many young people therefore roam the streets with nowhere to go and become easy prey to far-right extremists and, indeed, county lines gangs. What resources will the Government seek to provide to enable local councils to rebuild such community networks?

[Lord Khan of Burnley (Lab)]

My noble friend makes a very interesting point. As the Minister with responsibility for regional investment within MHCLG, I know at first hand that deprivation and poor cohesion tend to leave communities more vulnerable to extremist narratives and disorder. Regardless of those factors, there is no place in British society for violent disorder. I have been engaging with communities across the country to understand the issues that they face, and I have recently visited Leeds, Southport, Sunderland, Middlesborough and Hartlepool to witness their concerns at first hand. I reassure the noble Baroness that work is under way to understand what contributed to the disorder that we saw and to develop a more joined-up and strategic approach to communities and social cohesion. I shall be in a position to make a statement on that in due course.

[Baroness Hussein-Ece (LD)]

My Lords, the Minister quite rightly points out that there are a variety of challenges to address the root causes of these riots. Much of the violence appeared to be triggered by false rumours that the perpetrator of the terrible killing of the three girls in Southport was an immigrant. Online misinformation circulated, targeting very vulnerable people. While we accept that many people are struggling to make ends meet, the rise in immigration can be and was an obvious scapegoat. Misinformation—that somehow migrants are taking people’s homes and jobs, claim benefits and get free houses—causes flashpoints. Does the Minister agree that every one of us, led by the Government, has a responsibility to convey the truth and correct misinformation about asylum seekers taking people’s jobs and getting free homes? The truth is that they are entitled to £49 a week, and they cannot work—

[Baroness Hussein-Ece (LD)]

That was a question. They cannot work until they are granted asylum. Millions of migrants make a massive contribution to our economy, filling jobs such as in social care. We need that kind of information to get through to communities.

[Lord Khan of Burnley (Lab)]

Anyone who stokes this sort of violence, whether on the internet or in person, can face jail time. Riot, public nuisance and criminal damage all carry a sentence of up to 10 years in prison. Those who incite hate online must face the consequences. The Technology Secretary has had useful meetings with social media platforms to make clear their responsibility to continue to work to stop the spread of hateful misinformation and incitement online. Where they have already acted, they have the full backing and support of government officials. This is a really important point. The Government continue to work with social media platforms to proactively refer content for them to assess and take action, and to ensure that they are actively engaging with law enforcement on criminal intent.

[Baroness Scott of Bybrook (Con)]

My Lords, the scenes that we saw over the summer were shocking. The police and courts made an exemplary effort to respond to the situation, but the Government must now look at the root causes of this violence. What steps will the new Government take to improve social cohesion and tackle racism wherever it raises its ugly head?

--- Later in debate ---

[Lord Khan of Burnley (Lab)]

I thank the noble Baroness for raising that important point once again. Just to remind the House, I have already visited Leeds, Southport, Sunderland and Middlesbrough, as well as other places, so I assure her that work is under way to understand what contributed to this disorder. We are developing a strategic approach to communities. This is a cross-government approach—it is not just for the MHCLG to look at—to work out how we enhance social cohesion and build community resilience.

[Lord Hogan-Howe (CB)]

My Lords, we saw in the riots police officers outnumbered and attacked with bricks for defending people in mosques—asylum seekers and some of their colleagues. Their job is made no easier by excusing the behaviour of the rioters, even though the causes of that riot may need to be understood. We should celebrate the officers’ behaviour and the fact that they did it while outnumbered and carried on walking forward when it would have been easier to run away. Will the Minister support me in saying that?

[Lord Khan of Burnley (Lab)]

I support the noble Lord’s comments 100%. The police have our full support to use their powers without fear or favour. I have enormous gratitude for the dedicated officers who worked tirelessly to respond to the unfounded violence and abuse. The Home Secretary continues to work with law enforcement, across government and with the entire criminal justice system to ensure that we are fully equipped to deal with these incidents.

[Baroness Hoey (Non-Afl)]

My Lords, does the Minister agree that disinformation must not happen also because the Government are involved in any kind of disinformation? I am sure he will agree with that, but will he then agree that perhaps it is not sensible for Ministers or the Government to condemn almost anyone who was involved in any protest using the terminology “far right”?

[Lord Khan of Burnley (Lab)]

My Lords, the Khan review cited divisive language from politicians and a decline in trust and participation in democracy as factors that contribute towards worsening social cohesion. Politicians on all sides have a duty to use language carefully and consider the effects of their language on social cohesion. The Government have made a firm commitment to restore trust in government.

[Lord Woodley (Lab)]

My Lords, poverty increases people’s disillusionment with the political system and encourages people on the far right to join up. Fire and rehire and forced zero-hours contracts are a major insecurity of poverty. Can the Minister assure the House that the forthcoming legislation will impose a ban on fire and rehire and forced zero-hours contracts?

[Lord Khan of Burnley (Lab)]

I say to my noble friend that this will be discussed and legislation brought forward in due course to tackle the issues he raises. Let me use my final point to say to the House that there have been 1,280 arrests related to the disorder and 700 people have been charged. The number of charges will increase significantly over the coming days and weeks. More than 100 extra prosecutors have been brought in to work with the police.

Teesworks Programme: Audit

Lord Khan of Burnley Excerpts

Monday 29th July 2024 Lords Chamber

[Lord Scriven (LD)]

I beg leave to ask the Question standing in my name on the Order Paper, and so doing draw the House’s attention to my interest set out in the register as a vice-president of the Local Government Association.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)]

The previous Government asked the Tees Valley mayor to provide a progress update in September, following the recommendations of the independent review of Tees Valley Combined Authority’s oversight of the South Tees Development Corporation and Teesworks Joint Venture. Once we have received that update, we will consider whether the questions that need to be answered have been and whether any further action should be taken.

[Lord Scriven (LD)]

My Lords, many Teessiders’ jaws will drop on the floor when they hear that Answer from the Minister, as every Labour candidate in Teesside promised that a National Audit Office review would take place. In the light of half a billion pounds of taxpayers’ money being used and two businessmen making multimillion pound profits without taking any liabilities or any risk to their money, does that constitute best value? Why leave the people who have created the mess to solve the mess without any enforceable action being taken by Government?

[Lord Khan of Burnley (Lab)]

My Lords, I pay tribute to the work the noble Lord, Lord Scriven, does in local government, and I understand the deep emotions that he talks about, because there are outstanding questions to which the public deserve answers. We understand that this issue, like all local issues, is emotive. This is evidenced by it being raised in this House and in the other place several times. In fact, the noble Lord, Lord Scriven, has asked this question before. This Government believe that scrutiny and transparency are important. However, we must carefully consider the mayor’s response, due in September, and we will consider any further action to take when we receive it. We are not ruling out any options, and one option could be requesting the NAO to review.

[Baroness Armstrong of Hill Top (Lab)]

My Lords, as the Minister knows, this is an issue that the people of Teesside take very strongly. When I was working in the Tees Valley across a number of constituencies during the election, they really wanted transparency. They want to know what has happened to the money that the public, via the Government and other agencies, have put in and whether the arrangement, which gives 90% of the benefit to two individuals and only 10% to the public, can stand up. I appreciate that the Minister will bring the report, but will he also ask his department to look at an overall system of audit and accountability, because that disappeared when the Audit Commission disappeared, and there is no coherent across-the-board system for the devolved mayors. We want to give them more power, but if they get more power there must be transparency and proper accountability.

[Lord Khan of Burnley (Lab)]

I thank my noble friend for raising those important issues. It is true that the previous Government scrapped the Audit Commission and replaced it with a fragmented, locally led audit regime that is failing. This Government are committed to overhauling local audit and restoring better value for money for taxpayers. We are looking closely at all the evidence, and we will set out our plans, including legislation, shortly. I must remind the House that until we get the response of the Mayor of Tees Valley we cannot explore the options. We will wait for the response to the 26 recommendations which the mayor was asked to look at and then take further action.

[Lord Shipley (LD)]

My Lords, the Minister said that scrutiny is important and has committed the Government to undertaking further action when the mayor’s response has been received. What is the Minister’s expectation of the timescale? The mayor will respond quite soon, as I understand it, and the Government then have to say what they want to do. Can the Minister tell us how long that might be? Will he take into consideration the fact that the Tees Valley Combined Authority plans to have only five meetings of its cabinet in the period from September this year to the end of June 2025?

[Lord Khan of Burnley (Lab)]

I cannot comment on the meeting schedule of the Tees Valley Combined Authority. That is something for it to look at. In relation to the timeline, I have said to the House in previous answers that until six months have passed and the mayor has had an opportunity to address the concerns in relation to the 26 recommendations, we cannot work on this further. In the meantime, we recognise the point made by my noble friend that local audit needs transformative change, and noble Lords will very shortly hear the plans for changing the way local in which audit takes place.

[Lord Foulkes of Cumnock (Lab Co-op)]

My Lords, does the Minister share my mystification that none of the Conservative Members of this House are getting on their feet to make a comment?

[Lord Khan of Burnley (Lab)]

My Lords, I always enjoy my noble friend’s mystification. However, I cannot comment on this particular issue. Noble Lords are very welcome to ask any questions, and I am looking forward to them.

[Lord Young of Cookham (Con)]

My Lords, was there not an independent review into all these matters which found

“no evidence of corruption, wrongdoing or illegality”?

[Lord Khan of Burnley (Lab)]

That is absolutely the case. However, there are recommendations on decision-making, governance and scrutiny. I appreciate the noble Lord’s question.

[Lord Scriven (LD)]

My Lords, I appreciate that the Minister has said the Government have to wait for the mayor’s answers to the questions, which is different from what was being said before the Government were on the Government Benches. However, the review panel said in the report that the responses

“reduced our confidence that we have been given access to all relevant materials”.

The panel also said that it had

“not been able to pursue all lines of evidence or examine all transactions”.

Is that not why a full statutory audit is required: so that the Government convince themselves that Teessiders are getting value for money? With a response from the mayor, the report will have not seen all relevant information.

[Lord Khan of Burnley (Lab)]

The noble Lord again makes an important point. I remind the House that it is not the normal role of the NAO to examine or to audit local bodies. However, I understand that the NAO previously stated that it is willing to work outside its usual scope to undertake a review about Teesworks. We cannot prejudge the response of the Mayor of Tees Valley. When we get that response, we will look at it. In relation to the noble Lord’s question, that is another issue for the combined authority and the Mayor of Tees Valley to look at. Whatever happens, once that response is back with the Government, we will look at it and take further action then.

King’s Speech

Lord Khan of Burnley Excerpts

Tuesday 23rd July 2024 Lords Chamber

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)]

My Lords, it is a great honour to close this important debate on His Majesty’s gracious Speech. I thank your Lordships for your many learned contributions, not least among them the excellent opening speech made by my noble and learned friend Lord Hermer, the Attorney-General—his maiden address to this House. With his decades of legal expertise at the very highest level, I know that my noble and learned friend will make an enormous contribution to this place and I take this opportunity to welcome him.

I also pay tribute to the noble Lord, Lord Booth, for his maiden address to this House, and to the former Ministers, the noble Baronesses, Lady Swinburne, Lady Penn and Lady Scott of Bybrook. Both my noble friend Lady Taylor and I thank them for their collegiate approach and work on this brief. We look forward to working with them in the future, and with the noble Baroness, Lady Pinnock, from the Liberal Democrat Benches.

I also pay tribute to the noble Lord, Lord Warner, who is retiring after almost 26 years in this place. I thank him for his decades of devoted public service and for the important work he has done throughout his career—both as a parliamentarian and as a civil servant—to improve the delivery of public health, child protection and youth justice services in this country.

It is my personal privilege to stand before your Lordships today, for the first time as a Government Minister—an honour that not many working-class lads from Burnley grow up thinking they will achieve. I thank all those who have offered their kind congratulations following my appointment to this office. But we cannot ignore how Westminster, the very heart of our democracy, feels further away than ever for millions of people across our country living in towns like mine. Ordinary working people have seen the gap between the sacrifices that they have been asked to make and the service that they have received from politicians grow into a chasm in recent years. Builders, plumbers, nurses, taxi drivers, as my dad and I used to be—hard-working people are doing the right thing but struggling to make ends meet, because of decisions made here, in this place.

It is time to restore faith and trust in our democracy and bridge the divide that has grown between politics and the people, by delivering the change that this Government were elected so decisively to bring—a point that a number of noble Lords made this evening.

We will place public service at the heart of everything we do, as we fulfil our mission of national renewal. This begins with putting more power than ever before in the hands of local people, kickstarting a devolution revolution in England that will transfer more decisions from Westminster to those who know their communities best, putting local people in charge of shaping their future and delivering the progress that local communities want to see. As a former Mayor of Burnley, I know first hand the transformative change that strong local leaders can achieve if given the powers to do so.

This work has already begun. Within days of taking office, the Prime Minister and Deputy Prime Minister hosted combined authority mayors in Downing Street to discuss our plans for change. Last week, the Deputy Prime Minister wrote to local leaders in devolution deserts across the country to set this political transformation in motion, encouraging them to take on new powers in areas such as transport, adult education and skills, housing and planning, and employment support. We are driving forward our national mission to boost economic growth.

We have seen the benefits of devolution in Greater Manchester. The city region has been one of the UK’s most spectacular success stories and fastest-growing areas over the last 20 years, and it is predicted to outpace national growth for years to come. This success has been led by Mayor Andy Burnham, who has used his powers to encourage investment, boost skills and integrate the local transport system.

We have seen the impact of devolution elsewhere in the country too, with mayors playing a crucial role in attracting new investment, such as Boeing and McLaren to South Yorkshire, creating good new jobs, and West Yorkshire becoming the UK’s fastest-growing digital hub outside London thanks to local leadership.

But, as we all know, these successes are the exception and not the rule. Regional growth has stagnated in recent years. The productivity of our major towns and cities still lags far behind. This is a lose-lose situation for us all. The Centre for Cities estimates a £180 billion boost to the economy if productivity in the north and Midlands matches that of London and the south-east. This is why we are encouraging local leaders to develop ambitious, long-term local growth plans that build on their area’s existing strengths, partnering with them to attract more business, create more jobs and deliver more opportunity for local people. We will join forces with major employers, universities, colleges and industry bodies to identify growth sectors and give them the support that they need to thrive.

Where there is a solid track record of sound financial management, we will simplify the funding process, giving local leaders the space and flexibility they need to progress. But the power of devolution does not stop at economic growth. We want to give people the tools to transform the look and feel of the neighbourhoods and high streets they love, too. Our English devolution Bill includes a new right-to-buy option, so that communities can purchase much-loved assets such as empty shops, pubs and community spaces, while helping to tackle the blight of empty premises, spruce up public spaces and give local communities greater power to shape services and influence regeneration.

Our mission to transfer more power to local leaders in England echoes the spirit of devolution to Scotland, Wales and Northern Ireland 25 years ago. As we celebrate a quarter of a century since this landmark reform was made, we must reset and restore the strained relationship we have inherited between Westminster and the devolved Governments, rebuilding the partnership between us. We are a Government for the whole United Kingdom: a Government who work in the interests of people living in every corner of our four nations, so that we can stand together once again to face the challenges of an uncertain world.

The Prime Minister is leading this work to rebuild our country, work that began on day one of our new Government when he spoke with the First Ministers of Scotland and Wales and the First and Deputy First Ministers of Northern Ireland, before travelling to meet them in Edinburgh, Belfast and Cardiff within his first 48 hours in office.

We are committed to strengthening the structures and institutions of our partnership of Governments, so that we can lay the foundation for change and deliver the programme of reform and national renewal that our country so badly needs. A council of the nations and regions will be established to underpin this work, with the Prime Minister partnering directly with the elected heads of Government in Scotland, Wales and Northern Ireland, and with the mayors of the combined authorities of England, who will be working closely with the Deputy Prime Minister to ensure that our national reforms deliver for people living across our United Kingdom.

But to restore faith in our democracy, we must first clean up our act here in Westminster, beginning with strengthening the enforcement of standards in public life. The Government are committed to establishing a new independent ethics and integrity commission with its own independent chair. This will ensure probity, restore confidence in government and make sure that Ministers are held to the highest standards, helping reset our public life.

As set out in our manifesto, the Government are committed to constitutional reform and modernising how Parliament works. As a first step, we will introduce a focused Bill that removes the right of hereditary peers to sit and vote in the House of Lords. Noble lords will be aware that the measures put in place in the House of Lords Act 1999 were intended to last only for a short period before more substantial reforms were enacted. It has now been 25 years since the passage of that Act and, as a first step on the road to further reform, now is the time for this modernisation.

The Government recognise the good work of hereditary peers who scrutinise the Government of the day and improve the quality of legislation, but reform is essential and long overdue. Places in the second Chamber should not be reserved for individuals because of their family background. For this reason, the Government hope that noble Lords will support this measure when it comes before the House.

The Government will act to strengthen our democracy at its roots by making our electoral system fairer, more secure and more inclusive, improving participation and, in due course, extending the franchise to 16 and 17 year-olds, thoroughly reviewing and addressing the rules on voter ID, and tightening the rules around donations to political parties. These reforms will give more people a voice, and a stake, in our democracy. They will help us meet the threat posed by malign actors who seek to interfere in our elections and give us the tools we need to root them out and expel them from our political finance framework.

I turn to the contributions from noble Lords across the House. On the points made by the noble and learned Lord, Lord Keen of Elie, the noble Lord, Lord Strathclyde, my noble friend Lady Jay of Paddington and other noble Lords, the ongoing position, as has been stated in the House, is indefensible and can be addressed quickly through this hereditary Peers Bill. The manifesto is clear that the Government are committed to acting decisively to address the most pressing issues by bringing about immediate modernisation. The first step in this process is this Bill, and this will not preclude further reforms.

The Government are committed to other reforms to the House of Lords. The noble Baroness, Lady Jay of Paddington, asked about this. We are in particular looking at introducing changes to the appointments process and at a mandatory retirement age, as well as a long-term commitment to replace the House of Lords with an alternative second Chamber that is more representative of the regions and nations. Given the nature and potential scale of these reforms, the Government will conduct engagement and consult on proposals for an alternative second Chamber, seeking the input of the British public on how politics can best serve them.

I listened to the ideas my noble friend Lord Foulkes of Cumnock presented. I will take them back to the department. I also pay tribute to the contribution of the noble Lord, Lord Burns. I thank him for his previous work on this area. I will look at the points he made and take them back, in particular in relation to the size of the House.

The Government have committed to improving the appointments process to ensure the quality of new appointments and to seek to improve the national and regional balance of the second Chamber. We are actively considering how this can best be achieved. I reject the assertion of the noble Lord, Lord Cromwell, that this is a purge. The intention is to make sure that the House is fit for purpose, in line with modernising this House and politics generally.

The Government have set out a commitment to introduce a retirement age. As the Prime Minister said, the Lords has become too big. The manifesto also sets out other measures, including the introduction of a participation requirement. The Government recognise the good work of many Peers who scrutinise the Executive and improve the quality of legislation.

The noble Lord, Lord Fowler, said that this was an unprecedented opportunity for reform and we should not need 30 years. That is why the work will start now. The House of Lords plays an important role in scrutinising, as I mentioned, and we recognise the valuable contribution of many Peers. It is important that Members participate in support of this core function.

The noble and learned Lord, Lord Hope, spoke about non-attendance. We are looking at how we can deliver the manifesto commitment to introduce this participation requirement, building on existing rules that require Members to attend once every parliamentary Session.

My noble friend Lord Grocott alluded to the by-elections. Abolishing the by-elections would run counter to our commitment to bring about immediate modernisation. The youngest hereditary Peer is in their 30s, so this approach would mean hereditary Peers could remain part of this House for generations. I take the point my noble friend made; had we dealt with this earlier, we would have had a much smaller House.

The noble Lord, Lord Northbrook, asked whether the Earl Marshal and the Lord Great Chamberlain would remain as Peers. The Earl Marshal is responsible for the organisation of major ceremonial state occasions, such as the Coronation of the monarch and state funerals. The Lord Great Chamberlain has charge of many parts of the Palace of Westminster and is the sovereign’s representative in Parliament. The important ceremonial functions of both will not be impacted by this Bill.

The noble Lord, Lord Wallace of Saltaire, asked how long it would take to set up the modernisation committee he referred to. The Government are committed to bringing about a return to politics of service and, as a priority, intend to tighten the existing prohibition on MPs providing paid parliamentary advice.

The noble and learned Lord, Lord Keen, and the noble Viscount, Lord Hailsham, talked about our approach to the Lords Spiritual. Some Peers, including the noble and learned Lord, asked why the Government were not planning to remove the Lords Spiritual from this House. The legislation announced in the King’s Speech is a focused Bill to bring about immediate modernisation by removing the rights of hereditary Peers to sit and vote. In contrast to bishops, hereditary Peers gain their position as a birthright. As I said, we are committed to an alternative second Chamber that will be more representative of the regions and nations.

A number of noble Lords made contributions in relation to electoral reform. I will start with the points made by the noble Lord, Lord Wallace of Saltaire. The Government are clear that all legitimate voters should not only have the opportunity to vote in our vibrant democracy but be actively encouraged to participate. The Government will therefore act during this Parliament to give 16 and 17 year-olds the right to vote in all elections, strengthening our democracy, empowering young people to participate and building an informed and empowered electorate. Alongside this, we will tackle the unacceptable participation gap in our elections by taking wider action to improve rates of electoral registration. My noble friend Lord Alli made that point eloquently.

While we act to encourage participation, we will also protect our democracy from malign actors who seek to interfere in UK elections through illegitimate political donations. We will act to strengthen the rules around donations to political parties, a point that my noble and learned friend Lord Falconer of Thoroton alluded to.

Those aged 16 and 17 can work, pay tax and serve our country in the Armed Forces. It therefore stands that they should also be entitled to vote and have their say on issues that affect them and their future. The Government will act during this Parliament to give 16 and 17 year-olds the right to vote in all UK elections, strengthening our democracy and empowering young people to participate in it. We are determined to do this right. This will be a major change to the electoral franchise, requiring careful planning and engagement with stakeholders in the electoral sector, devolved and local government, education and civil society and, importantly, young people themselves to ensure its success. By engaging voters early when they are young, we will build the foundations for their lifelong participation in our electoral process, as illustrated by the noble Baroness, Lady Smith of Llanfaes. Our Government will work with the electoral sector, as mentioned before, raise participation and make the electoral system more effective. We have a lot of progress to make ahead of primary legislation and will explore opportunities to do so.

The noble Baroness, Lady Smith of Llanfaes, and the noble Lord, Lord Rennard, talked in particular about voter ID. We have had concerns about the voter identification policy, and a long, vigorous debate has previously taken place in this House and the other place on this issue. The Government are committed to carefully and thoroughly reviewing the voter ID rules and evaluating how they impacted citizens during the general election, before bringing forward firm proposals in due course.

In relation to points made by the noble Baroness, Lady Pinnock, and the noble Lord, Lord Rennard, as well as the noble Lord, Lord Wallace, about automatic registration, we want to raise participation in our vibrant democracy and will explore options for achieving that objective. We will look at ways to use data and wider public services to encourage and support electoral registration. We will look to test different approaches and use experience from other countries to inform our decisions.

The noble Lord, Lord Rennard, talked about the independence of the Electoral Commission. On the Electoral Commission strategy and policy statement, it is vital for public confidence in our democracy that the independence of the Electoral Commission is upheld. The existence of a strategy and policy statement for the Electoral Commission is inconsistent with the commission’s role as an independent regulator.

The noble Lord, Lord Bruce, talked about first past the post. The voting system used to elect our representatives sits at the heart of our democracy and is of fundamental importance. The first past the post system is a clear way of electing representatives, is well understood by voters, and provides strong and direct local accountability.

The most reverend Primate the Archbishop of York talked about people being turned away at polling stations. We will conduct a thorough evaluation of the voter ID rules and evaluate how citizens during the general election were affected by the acceptance, or non-acceptance in some examples, of ID. Consideration of the evaluation will be given by the Electoral Commission before bringing forward firm proposals in due course.

The noble Baroness, Lady Lawlor, talked about postal votes. The availability of postal voting supports many people who would not otherwise be able to participate in person due to disability or family commitments. It is illegal to use another’s vote, and there are serious sanctions, including fines and imprisonment.

In response to the noble and learned Lord, Lord Thomas of Cymgiedd, I recognise the points made on statutory instruments. I can confirm that the department will take the necessary steps to ensure that information is available to enable effective scrutiny, and that drafting quality is of utmost importance to this Government. He talked about the end of skeleton Bills, as did the noble Lord, Lord Anderson of Ipswich. The Government recognise the vital importance of allowing Members of both Houses to scrutinise legislation effectively. There will be times where it is appropriate to have framework powers—in regulations in particular. However, we will make sure that there is flexibility, and will increase the minimum wage and uprate benefits in relation to this framework. This new Government will ensure that legislation is brought to this House in a state and manner befitting its importance to allow for effective scrutiny, implementation and improvement of Bills.

It has been a wide-ranging debate, but I will try to get through it in relation to the English devolution Bill. English devolution has been evolving for the past 10 years, with almost half of the English population now covered by devolution deals. However, to date, devolution deals have been struck with areas on a case-by-case basis, leaving a patchwork of institutions with different powers and governance arrangements which is difficult to navigate—these points were made by the noble Lord, Lord Kirkham, the noble Baroness, Lady Eaton, and my noble friend Lord Foulkes of Cumnock.

This landmark devolution Bill will fix this problem by establishing a new, clear devolution framework which will enshrine the role of local leaders in statute, extend the benefits of devolution to more areas and guarantee all areas access to an ambitious set of new powers which will unlock economic growth.

In relation to the point raised by my noble friend Lord Berkeley about the Isles of Scilly, the Deputy Prime Minister has made clear her desire to see devolution extended to every corner of England, and she is inviting local areas to put forward proposals. I will take back the issues my noble friend Lord Berkeley raised.

On the point made by the noble Lord, Lord Scriven, the English devolution Bill will deliver on our commitments to move power out of Westminster and strengthen mayoral powers. We are committed to engaging with local leaders on this enhanced devolution framework as it is developed. A number of points were made in relation to devolution. I have covered as many as I possibly can. I believe I have up to 25 minutes.

I want to finish this point about ethics and integrity. We will establish an independent ethics commission, as I mentioned. The Government are committed to restoring confidence in government and ensuring that Ministers are held to the highest standards. The ethics and integrity commission will therefore have the powers and functions necessary to do that.

In relation to the points noble Lords made in relation to Northern Ireland, the Leader of the House is in her place listening to them. We will come back and are happy to write to noble Lords on these points.

The Government are determined to rebuild the bonds of trust between people and politicians in this country. We know the damage done can be mended only by actions, not words. This will take time, but the work of change has already begun. It is a privilege to stand here as a Minister. I assure noble Lords that I intended to be an engaged Minister with my door always open to discuss issues and concerns that your Lordships may have. I reiterate the point made by my noble and learned friend Lord Hermer that it is imperative that we respect the rule of law, and I am pleased that this commitment is explicitly included in the oath taken by law officers.

The reforms we have debated today demonstrate the Government’s fundamental commitment to public service as we change our country for the better, putting the interests of ordinary working people at the forefront of all we do, rebuilding respect for our politics, restoring faith in our democracy and reuniting our country.

Debate adjourned until tomorrow.

Renters (Reform) Bill

Lord Khan of Burnley Excerpts

2nd reading
Wednesday 15th May 2024 Lords Chamber

[Lord Khan of Burnley (Lab)]

My Lords, it is a pleasure to close this Second Reading debate for the Opposition, and I thank all noble Lords who have participated at this stage of the Bill. The expertise, skills and knowledge on this subject in your Lordships’ House have been demonstrated in a most eloquent manner, and I agree with the noble Lord, Lord Cromwell, that it has been a fantastic and diverse debate. I also pay tribute to all the campaign groups and organisations that have campaigned consistently on the Bill. I thank all of them for their very helpful briefings, and I agree with the noble Baroness, Lady Jones of Moulsecoomb, that I have never had this number of briefings on any Bill I have worked on in your Lordships’ House.

On these Benches, we welcome the Bill. As the noble Lord, Lord Best, said, this is an improvement, with steps to redress the landlord and tenant imbalance. As my noble friend Lady Lister rightly said, it achieves a fairer balance between landlord and tenant while increasing tenant security. In fact, I actually welcome much of what the Minister said in her opening remarks. However, the point has to be made that, unfortunately, three Prime Ministers and 10 Housing Ministers later, and five years since committing to abolish Section 21, nearly 85,000 households have been threatened with homelessness by a no-fault eviction. The Government’s dither and delay have had a catastrophic effect on families across the nation.

I want also to turn to a point made by my noble friend Lord Hacking—I apologise that he was not at the top of the list; nevertheless, he made some very important points. There were 225 amendments and 24 new clauses tabled in Committee in the Commons, and 183 amendments and 52 new clauses tabled on Report. The amendments and new clauses were actually lengthier than the Bill when it started out, which I think is cause for concern. We are seeing too many Bills coming here with huge numbers of amendments tabled in Committee and on Report.

Renters are at the sharp edge of the current housing crisis and urgently need the protections and support in the Bill. We will be pleased to finally see the abolition of Section 21, whenever that actually happens—let me repeat, “whenever that abolition actually happens”, a point made by noble Lords across this House. Since October 2023, the Government have stated that they

“will not commence the abolition of section 21 until stronger possession grounds and a new court process is in place”.

The Bill as drafted already provided for a two-stage commencement process for the introduction of the new regime, with precise dates for new and existing tenancies to transition to be determined by the Secretary of State. However, the government amendment on Report in the other place was very widely drawn, with no time limits or obligations on the Secretary of State to enact the ban on no-fault evictions, regardless of the outcome of the Lord Chancellor’s assessment. This would effectively allow the Government to stall on the enactment of the ban indefinitely. As the noble Lord, Lord Thurlow, said, this could happen in a year, in 18 months or not happen at all. Landlords and tenants should be given certainty about precisely when the Government’s manifesto commitment to abolish Section 21 no-fault evictions will be enacted. As my noble friend Lady Taylor of Stevenage said in her opening speech, we will bring forward an amendment to ensure that Section 21 of the Housing Act 1988 will be repealed on the day the Bill receives Royal Assent.

We also welcome the simplification of tenancies, which will give renters more flexibility and more rights. It is right that periodic tenancies should become the norm. For too long, renters have lacked basic power and control over one of the fundamentals of life, their home. Tenants have struggled to challenge unfair treatment without undergoing lengthy and expensive court proceedings, a point made very eloquently by my noble friend Lord Adonis.

Hence, we welcome the creation of a new ombudsman who has the potential to be an essential part of the redress system. I agree with my noble friend Lady Warwick of Undercliffe on the need for the proper steps to ensure that there is a fair process for the procurement of the new private sector ombudsman. If this ombudsman is given the proper teeth and resources, they will have an important role to play in levelling the playing field.

The tragic death of two year-old Awaab Ishak, caused by the damp and mould in his home, shocked the whole nation. With our support, the Government introduced Awaab’s law in the social housing sector, and they were right to do so. But the problem of debilitating damp and mould, and landlords who fail to investigate such hazards and make the necessary repairs, is not confined to social rented homes. A Citizens Advice report published last year made it clear that the private rented sector has

“widespread problems with damp, mould and cold, driven by the poor energy efficiency of privately rented homes”.

The report went on to evidence the fact that 1.6 million children in England currently live in cold, damp or mouldy privately rented homes.

According to the English Housing Survey, 23% of homes in the private rented sector do not meet the decent homes standard. That is around 1 million homes. This compares with 13% of owner-occupied and 10% of social rented homes. In the face of such a pervasive problem, we can think of no justification whatever for restricting Awaab’s law purely to the social housing sector. We hope that the Government will agree and accept the same law for the private rented sector, because we can think of no reason whatever why they would resist doing so.

In the other place, in relation to the issue of safe and decent homes, Minister Jacob Young said it would be dealt with through enforcement by local housing authorities as well as the private rented sector ombudsman, and that the Government considered that this was of no interest to tenants. We are not convinced by the Government’s response. How have the Government determined that there is no interest in Awaab’s law among tenants in the private rented sector? Have the Government consulted with them?

If anything, there is a stronger case for applying Awaab’s law in the private rented sector. Things are worse in the private rented sector, as illustrated by the Citizens Advice statistics I have just read out. We will come back to this at a later stage in the Bill. If the measures are appropriate for the social rented sector, they should be appropriate for the private rented sector. Does the Minister accept that conditions in the private rented sector are far worse than in either the social rented or owner-occupied sectors, with 1.6 million children living in cold, damp or mouldy homes? If so, why does she not support tougher measures to compel landlords to rectify these problems?

I further ask the Minister to tell us what estimates the Government have made of the number of households likely to be threatened with homelessness by a Section 21 notice, from now until the time when the Lord Chancellor completes his assessment of the courts. Is the Minister concerned that the new, more vague definition of anti-social behaviour could lead to victims of domestic abuse being evicted on anti-social behaviour grounds while undergoing the trauma of abuse? This point was made by my noble friend Lady Lister, as well as by the noble Baroness, Lady Thornhill. My noble friend asked for justification for the wording; I look forward to seeing what response the Minister will give.

There have been a number of excellent contributions, but I want to pinpoint the interesting historical significance that the noble Lord, Lord Best, provided us with. The noble Lord outlined that, in the 1980s, the private rented sector was 9% of the nation’s rented homes. In the 2000s, that became 20%. Some 2.3 million private landlords are still looking to this Bill to ensure that their life gets better. The noble Lord talked about the demise of council house building, and how social housing has gone from 34% to 17% of the sector. The noble Lord also reminded the House that there has been a doubling of the private rented sector, and a halving of the social housing sector. At the heart of what he said—the very centrepiece of the Bill—is the lack of housing: there has not been enough housing built.

I was delighted to hear from the noble Lord, Lord Frost, who also made this very important point. In fact, he outlined that the target of 300,000 was last met in 1977. I liked the fact that he talked about reforming planning and building 300,000 houses per year; he sounded like he was reading the Labour Party manifesto for the next general election. I understand the point that we need to create better housing. There is a dysfunctional housing market, as the noble Lord stipulated, and the Government are consistently missing the housing targets.

The Bill is an important step forward. Supporting renters at the sharp edge of the cost of living crisis is very important, so we should all support this. On these Benches, we will work constructively throughout the passage of the Bill. This is a vital piece of legislation, because it seeks to provide greater security and stability for renters. This matters, because housing instability destroys wealth creation, damages life chances, restricts educational prospects and harms health. It is not just about policies; it is about people and their dreams, fears and aspirations. We need to build a system that uplifts everyone, regardless of their housing situation—a point that the right reverend Prelate the Bishop of Chelmsford made in terms of “safe, secure and sustainable”.

On these Benches, we strongly support fundamental reform of the private rented sector and have called for it for many years. Regardless of whether they are a home owner, leaseholder or tenant, everyone has the basic right to a decent, safe, secure and affordable home. Much more needs to be done to decisively level the playing field between landlords and tenants, and a Labour Government will seek to truly strengthen protections for private renters, so that they finally get the long-term security and better rights and conditions that they deserve. We look forward to working with noble Lords across the House to strengthen this much-delayed Bill and commit to a future where renters are empowered and their rights protected, and where housing stability is not a privilege but a fundamental right. We need to build a fairer, more compassionate housing sector that truly serves the people. I look forward to the Minister’s response.

--- Later in debate ---

[Baroness Swinburne (Con)]

I will check that but my notes tell me that it is six months before they can serve their notice.

I reassure the House that we are exploring potential exemptions to this six-month period in extreme circumstances, such as where there are serious health hazards, the death of a tenant, for victims of domestic abuse, and other such important issues. We will bring these forward as the Bill progresses.

With regard to domestic violence, as many noble Lords raised, we recognise that domestic abuse can be interpreted as anti-social behaviour by neighbours—for example, frequent shouting and intolerable noise. It would be wrong to evict victims, which is why it is important that the judicial discretion is used in ground 14 eviction cases. To consider eviction would be a reasonable step in these circumstances.

Many noble Lords raised the issue of a longer notice period for possession grounds, and powerful arguments for that have been made today. However, we believe that the notice periods for the grounds are set at a length which balances the needs of both tenants and landlords. They give tenants time to find a new home while ensuring that landlords can manage their assets when they need to.

Noble Lords have called specifically for tenants to be protected from the moving and selling ground for a longer period at the start of their tenancy, and we are already protecting tenants’ security by ensuring that landlords will not be able to use these grounds in the first six months of a tenancy. We believe that six months strikes the right balance between improving security and, of course, allowing landlords to continue to feel confident in the market.

The Government are committed to preventing homelessness before it occurs. The Bill will help to do that by abolishing Section 21 evictions, giving tenants greater security of tenure and, we hope, reducing the risk of homelessness. We are also providing total support of £108 billion over 2022-25—an average of £3,800 per UK household—to help households with the high cost of living. This includes increasing the local housing allowance to the 30th percentile of market rents from April, which will mean that 1.6 million low-income households will be around £800 a year better off on average in 2024-25, and over 740,000 have been prevented from becoming homeless or supported into settled accommodation since 2018 through the Homelessness Reduction Act. Between 2022 and 2025, we are investing over £1.2 billion into the homelessness prevention grant, which funds local authorities to work with landlords to prevent evictions and offer alternative sources of accommodation.

With regard to Awaab’s law, I am grateful for this being raised. We agree that no tenant should have to live in dangerous housing conditions. We are taking steps to ensure that hazards in rented homes are dealt with, but how we achieve this needs to take into account the differences between the private and social rented sectors.

Awaab’s law was developed for the social housing sector, in which landlords manage large portfolios of usually between 1,000 and 10,000 properties, and have dedicated repairs and maintenance teams. We believe that it is not the right approach for the private rental sector, in which 82% of landlords have fewer than five properties. Instead, we are strengthening enforcement against hazards in private rented homes. Local councils will be able to issue immediate fines of up to £5,000 if a dangerous hazard is present in a privately rented property and the landlord has failed to take reasonably practical steps to address it. We are also introducing the decent homes standard in the private rental sector for the first time, providing local councils with enforcement powers to require landlords to remedy failures to meet requirements.

[Lord Khan of Burnley (Lab)]

We had all these enforcement measures in the social rental sector but we still brought in Awaab’s law. The argument is for enforcement and the decent homes standards, but in the social housing sector we had all the support mechanisms in place—I understand the difference between large social housing and houses for couples or mum-and-dad families—so why the differentiation? Why could we not have Awaab’s law? The Minister says that this is a different situation, but there is still the opportunity to enforce and fine social housing landlords, so why differentiate?

[Baroness Swinburne (Con)]

The difference, as I have just alluded to, is between one person having to get external maintenance people in, and so be at the mercy of their agenda, and maintenance crews that can be sent to those areas that need prioritising. I have a huge number of questions to get through, so I apologise for being abrupt.

Many noble Lords raised concerns about the impact of reforms on the student market. Since introducing the Bill, we have heard from across the sector that, as originally drafted, the Bill would have interrupted the student housing market, reducing the supply of vital properties in university towns and cities. We have listened to these concerns and have introduced a new ground for possession which will allow landlords renting to students to seek possession ahead of each new academic year, facilitating the yearly cycle of short-term student tenancies. The ground has been carefully designed to balance the needs of both landlords and students. It will apply to any property that is let to full-time students, as long as the landlord gives prior notice to tenants at the start of the tenancy that the ground will apply.

Regarding different dates being used rather than the traditional academic year, there is nothing to stop landlords renting properties in January to students starting their studies at that time. Most students will continue to move in line with the traditional academic year. This ground provides a backstop for the majority of students studying from September. The alternative would be to allow the ground to be used at any point in the year, which would give tenants no certainty.

Representation of the People (England and Wales and Northern Ireland) (Amendment) Regulations 2024

Lord Khan of Burnley Excerpts

Monday 13th May 2024 Grand Committee

[Lord Rennard (LD)]

My Lords, the noble Lord, Lord Hayward, has once again demonstrated the essential truth of one of his major campaign pledges during the 1993 Christchurch by-election—that he would be very good at scrutinising secondary legislation. It is always a pleasure to work with him on such matters.

I am tempted to ask the Minister how often the Government have had to bring forward measures such as this, as a tidying-up and housekeeping exercise, since the Elections Act of 2022 became law. I will resist. However, the current measure is one of numerous examples of the Government appearing not quite to understand what they were doing in seeking to implement a Brexit deal which lacked details when it was agreed.

In considering what is before us today, the Shadow Minister in the House of Commons, Florence Eshalomi, explained that understanding this measure required understanding five or six different Acts and regulations spanning over 40 years of legislation. To correct the noble Lord, Lord Hayward, it was in answer to a Question of mine in this place some time ago that it was revealed that at that stage there had been 16 statutory instruments involved in implementing the Elections Act 2022, running to 803 pages, all of which have been added to since then by one, two or three further statutory instruments. This is simply the latest of them. The scale of the statutory instruments required by the Elections Act has presented a significant problem, not just for Ministers but particularly for those responsible for the conduct of our elections. I believe that the burden may have become intolerable and the risk of mistakes in the conduct of our elections has been increased significantly by this complexity.



First, can the Minister update us on government thinking about what we are all asking for—the proper consolidation of all our election laws, as recommended by the Law Commission, which has done much work on this subject?

Secondly, does the Minister accept that the Government’s explanation of the difference in voting rights between EU citizens from Ireland, Cyprus and Malta and those from the 19 EU countries with which we do not have voting and candidacy treaties is an anomaly that requires a fundamental review of the franchises for all our UK elections? In particular, does she accept that the principle of residency would be a good basis for the local election franchise, as those who pay for and receive services from local government should be able to vote for the people in charge of those local authorities? The principle of no taxation without representation is a good one. The Government seem obsessed with removing people from the electoral rolls, making it unnecessarily hard to register and then harder to vote if you are among the categories of people without acceptable photo ID from the very tightly drawn list.

Thirdly, what steps will the Government take to ensure that the different levels of voting rights applying to different EU citizens will be explained to them all?

Finally, what progress is being made with the 19 EU member states with which we do not have treaties concerning voting and candidacy rights to agree such treaties, bringing EU citizens in those countries into line with those from Spain, Portugal, Luxembourg, Poland and Denmark?

That said, the measure has our support as it provides some clarification and corrects mistakes that were inadvertently made.

[Lord Khan of Burnley (Lab)]

My Lords, the fact that we are here yet again emphasises the enormity and complexity of the Elections Act and electoral statute. I echo the comments by the noble Lord, Lord Hayward, supported by my noble friend Lord Stansgate, about consolidation of all electoral legislation. As the noble Lord, Lord Wallace, indicated in a meeting with the chief executive of the Electoral Commission, there are 1,100 pages of SIs as a result of the Elections Act. We should never have to come to that situation again.

It is critical that our electoral law is as legible and transparent as possible, not only for the health of democracy but, as I have repeated to the Minister previously, for the workload of our understaffed electoral teams, which are tasked with keeping the integrity of our elections intact. Mistakes in legislation in this area make that challenge even harder. They could create confusion and concern among dual nationals who are entitled to vote, by not only collecting unnecessary information from those looking to register but increasing the workload of electoral officers, who already have to tidy up databases and deal with queries from so many different members of the public who are confused as to why this question is being asked in the first instance. Unfortunately, rather than helping our electoral administrators, the Government have introduced an Elections Act that significantly increases the load on them.

This is the second correction the department has had to make following the Elections Act. Given that the consequences of these mistakes could potentially change the franchise, what steps is the department taking to proactively review that the legislation is working as intended so that no other potential consequences are being missed? I would be grateful if the Minister could outline what support is being provided to electoral officers to carry out the amendment to the franchise for EU nationals. What steps are the Government taking to ensure that there are no mistakes in the system? What is the Minister’s response to the report on voter registration from the Levelling Up, Housing and Communities Committee, which highlighted a creaking system without any efficiency and with the huge challenges presented by the Elections Act? I would welcome her thoughts on that.

I recognise the point made by the noble Baroness, Lady Bennett of Manor Castle, that this is a complicated area of law; we appreciate that. In summary, we support this draft statutory instrument, but I would welcome reassurance from the Minister on the points I raised and those eloquently raised by noble Lords across the Committee. I look forward to her response.

[Baroness Scott of Bybrook (Con)]

I thank noble Lords for their contributions today. I will go through a few of the issues that were brought up.

First, the noble Lord, Lord Hayward, is absolutely right: the instruments in this amending SI had no effect on the elections held on 2 May. The changes to the franchise for EU citizens came into force on 7 May; that date was chosen specifically so that there would be no impact on the May local elections.

We have heard quite a lot about consolidation, as we did when the Elections Bill, which is now an Act, was going through. I think that will be for subsequent Governments to look at. This is complex; there are huge numbers of pieces of legislation impacting on top of each other within the elections arena. As the noble Viscount, Lord Stansgate, and the noble Lords, Lord Rennard and Lord Khan of Burnley, brought up, that is something which will have to be done by subsequent Governments.

The noble Baroness, Lady Bennett, brought up the numbers affected. I do not know those numbers, but I will have a look and write to her. On the oversight occurring in the first place, as I said, I apologise—but it is recognised that, even with stringent checks in quite complex pieces of legislation such as this, there is always a chance of unintentional errors. Regrettably, sometimes they are overlooked and, unfortunately, this is one such case, but the main thing is that we are dealing with it now.

On the issues around differences in voting rights for residency, this instrument is focused on amending a definition in existing regulations. Those regulations have already been passed in Parliament—as I say, they came into force on 7 May—and there are no further plans to revise any of them. I remember well the debates held on the changes being introduced by those regulations, and this is not the time to go over them again. It is certainly not the time at this early stage, when the regulations have only just gone into law, to put forward further revisions.

The Electoral Commission will keep an eye on all these issues as they are put into place, as will the department. Of course, if there are any issues or problems, we will keep an eye on that. That was a point raised by the noble Lord, Lord Khan of Burnley. It is important that we keep a close eye on any changes, particularly to electoral legislation, as it is complex. If anybody who wants to register to vote goes on to the Electoral Commission’s website, all the details are on there—and people do that. Also, our wonderful election officers in our local authorities are usually the first contact that people have. Even if they are complex voters, all the information will be given to them by our local authorities as well, which is important.

I think that is everything I had to answer. I know that the House believes that ensuring the smooth running of our democratic processes is of paramount importance. This amendment is therefore important, and I thank noble Lords for supporting the instrument to get this right. I commend it the Committee.

Councillors: Publication of Addresses

Lord Khan of Burnley Excerpts

Wednesday 8th May 2024 Lords Chamber

[Baroness Scott of Bybrook (Con)]

I do not think it is a requirement to live in that local authority area necessarily, but it is important that anything on the register is correct. Obviously, there are ways of looking into that. The other interesting thing is that you can opt in or opt out. Some people like to opt in—they really want their names to be there—and therefore any legislation needs to give the opportunity for councillors or any other elected members to do that.

[Lord Khan of Burnley (Lab)]

My Lords, in recent months, many local and national politicians, including me, have been subject to behaviour from a minority of the public which goes beyond what is reasonable and acceptable, including putting people’s homes on social media, throwing fireworks through letterboxes, and horrendous abuse being given out on the doorstep. Keeping our politicians safe and feeling safe is vital not only for its own purpose but to stop others being put off from dedicating their lives to public service. What broader steps are the Government taking to ensure that this building pattern of intimidation is halted and reversed before it becomes an accepted norm against councillors, MPs and Members of this House?

[Baroness Scott of Bybrook (Con)]

The noble Lord is absolutely right. We cannot have intimidation stopping people wanting to be elected to represent their communities at whatever level—it is important even at parish council level. What more can we do? We can look for legislative time to change it, but, in the meantime, we are doing everything we can. We have put in £31 million more this year to bolster security for elected members and, as I say, if you are a local councillor, there is always an opportunity to go to your monitoring officer and ask for your home address to be taken off if you are worried about it or worried about your family.

Leasehold and Freehold Reform Bill

Lord Khan of Burnley Excerpts

Committee stage
Wednesday 1st May 2024 Lords Chamber

Moved by

[Lord Khan of Burnley]

92: After Clause 95, insert the following new Clause—
“Requirement to establish and operate a management company under leaseholder control(1) The Secretary of State may by regulations make provision—(a) requiring any long lease of a dwelling to include a residents management company (“RMC”) as a party to that lease, and(b) for that company to discharge under the long lease such management functions as may be prescribed by the regulations.(2) Regulations under subsection (1) must provide—(a) for the RMC to be a company limited by share (with each share to have a value not to exceed £1), and(b) for such shares to be allocated (for no consideration) to the leaseholder of the dwelling for the time being.(3) Regulations under subsection (1) must prescribe the content and form of the articles of association of an RMC.(4) The content and form of articles prescribed in accordance with subsection (3) have effect in relation to an RMC whether or not such articles are adopted by the company.(5) A provision of the articles of an RMC has no effect to the extent that it is inconsistent with the content or form of articles prescribed in accordance with subsection (3).(6) Section 20 of the Companies Act 2006 (default application of model articles) does not apply to an RMC.(7) The Secretary of State may by regulations make such provision as the Secretary of State sees fit for the enforcement of regulations made under subsection (1), and such provision may (among other things) include provision—(a) conferring power on the First-Tier Tribunal to order that leases be varied to give effect to this section;(b) providing for terms to be implied into leases without the need for any order of any court or tribunal.(8) The Secretary of State may by regulations prescribe descriptions of buildings in respect of which regulations may be made under subsection (1).(9) In this section—“dwelling” means a building or part of a building occupied or intended to be occupied as a separate dwelling, together with any yard, garden, or outhouses and appurtenances belonging to it or usually enjoyed with it;“long lease” has the meaning given by sections 76 and 77 of the Commonhold and Leasehold Reform Act 2002;“management function” has the meaning given by section 96(5) of the Commonhold and Leasehold Reform Act 2002.(10) The Secretary of State may by regulations amend the definition of “management function” for the purposes of this section.”Member's explanatory statement
This new Clause would ensure that leases on new flats include a requirement to establish and operate a residents’ management company responsible for all service charge matters, with each leaseholder given a share.

[Lord Khan of Burnley (Lab)]

My Lords, I will speak to Amendment 92 on behalf of my noble friend Lady Taylor of Stevenage. This new clause would ensure that leases on new flats included a requirement to establish and operate a residents’ management company responsible for all service charge matters, with each leaseholder given a share. The amendment has dual purposes. It would remedy two significant current flaws in the leasehold system that the Bill does not address, and it would provide a step forward to commonhold, without doing so in a piecemeal way.

I turn to the current flaws. First, unless leaseholders in blocks of flats acquire the right to manage, collectively enfranchise and then establish a residents’ management company, or buy a property in a development where a residents’ management company has already been set up, they have no control whatever over how their money is spent. This is despite having to pay all the costs to maintain and manage their buildings. Secondly, the rights that leaseholders do have to exercise control over how their buildings are managed—whether through a tribunal, the appointment of a manager or the right to manage—are locked behind difficult and often costly legal processes to which many will not have access.

Our amendment would address both these problems by requiring that when a new residential block of flats was constructed and its units sold the development should be a three-way lease between the freeholder, the leaseholder and the new residents’ management company. Each leaseholder in the block would then own a share of the residents’ management company, and it would be under their exclusive control, giving them full responsibility for services, repairs, maintenance, improvements, insurance and the cost of managing their building. This would give them control over how their money was spent. This ability to influence the management of their building would come at no additional cost.

The Minister will no doubt say that our amendment leaves no space either for limited cases in which a mandatory residents’ management company is not appropriate or where leaseholders simply do not want this responsibility. The Government have said many times that they are keen to give more home owners control over the management of their buildings, and we welcome that the Bill is moving in the right direction. Would it not make sense to have leaseholder management of their buildings to be the default?

Where mandatory residents’ management companies are not appropriate, could the Government not put forward such cases to be incorporated as exceptions? In the case of leaseholders not wanting to be compelled to manage their buildings, could there not be a provision for leaseholders to use the power of the management company to appoint a manager or simply return management to the freeholder? I would be keen to hear the Minister’s thoughts on these alternative options.

The real importance of this clause, however, comes from it being a key way of laying the groundwork for a future where commonhold is the default and leasehold becomes obsolete. It would help to create a cohort of leaseholders who have experience in running their buildings, as they would under a commonhold arrangement, even if that experience is limited both in time and the extent to which they have carried it out.

This is certainly not a perfect solution. It would do little for leaseholders who have already purchased their flats and do not currently have a residents’ management company. We need other solutions, building on measures already in the Bill to address the challenges they will continue to face. I look forward to the Minister’s response and beg to move Amendment 92.

[Baroness Thornhill (LD)]

My Lords, I support Amendment 92 in the name of the noble Baroness, Lady Taylor of Stevenage, and explained so well by the noble Lord, Lord Khan of Burnley. The right to manage was first introduced in the leasehold reform Act of 2002. From the start, it was, as the noble Lord said, intended as a simple and cost-effective alternative to collective enfranchisement, but, despite the happy intentions of that Act, the reality was quite different. Take-up has not been what we would all have hoped for or expected, because the right to manage has proved incredibly problematic in practice.

These problems culminated in the Law Commission’s final report in 2020—time has marched on—on exercising the right to manage. It summarises the difficulties as follows:

“The ‘simple’ RTM process envisaged in the original consultation which led to the 2002 Act has not come to pass. The requirement for strict compliance with the statutory procedures, such as the service of certain notices on particular parties, can be unforgiving to leaseholders. In many cases, small mistakes made by the RTM company have afforded landlords opportunities to frustrate or delay otherwise valid claims. The Court of Appeal has noted that while the procedures ‘should be as simple as possible to reduce the potential for challenges by an obstructive landlord’, in fact they ‘contain traps for the unwary’”.


This is not a good advert for anyone seeking to exercise the right to manage, which we believe is fundamental to the change we need. The Law Commission subsequently made 101 recommendations, of which the then Government adopted two.

Whole swathes of actions could be happening to make this process simpler and to encourage residents to take this up. We have no doubt that the process is not an easy one and that the provisions in the Bill as it stands are actually quite limited. The uplift from 25% to 50% is welcome, as are the beneficial changes in cost provision, and minor changes to courts and tribunals. They are all positive but underwhelming—a far cry from the 101 recommendations.

In debates throughout the course of the Bill we have heard numerous instances of excessive charges and unfair practices, from both Houses. The Law Commission summed it up best when it said that

“the landlord and leaseholder have opposing financial interests—generally speaking, any financial gain for the landlord will be at the expense of the leaseholder, and vice versa …Their interests are diametrically opposed, and consensus will be impossible to achieve”.

This amendment is quite realistic: it is starting only with new build, but what it does is symbolic, in that it draws a line under the past and clearly points the way forward. Noble Lords will notice that I am not wearing rose-coloured spectacles, and we are not saying that the residents’ right to manage will be any easier—but it will be fairer. Those paying the bills control the bills and can remove any poorly performing providers. We believe that a leaseholder-controlled resident management company with an elected board, accountable to all leaseholders, is a far more democratic arrangement than one middleman freeholder controlling block management, spending leaseholders’ money freely and not involving them in the decision-making processes. It is fundamentally a better way to go, and there seems to be widespread support for it.

We support this amendment because we believe that it is a step in the right direction and could reinvigorate right to manage with the right support. It seems that the Government are finding reasons not to do something instead of working to enable something better to happen.

--- Later in debate ---

I am acutely aware that, before and during the passage of this Bill, there has been much debate about commonhold across the House. We fully support a move to commonhold and, while we cannot go as far as many noble Lords would like, it is a journey. With that, I humbly request that the noble Lord withdraw the amendment.

[Lord Khan of Burnley (Lab)]

My Lords, I thank the Minister for his response, although it does not satisfy exactly the issues that we have raised. I thank the noble Baroness, Lady Thornhill, for saying that this

“draws a line under the past”

and is a

“step in the right direction”.

It is a fairer process when those who are paying the bills have control of the bills.

We would not need this amendment if the Government had followed the Law Commission recommendations to move to a commonhold system now. This is a missed opportunity. That is why we have argued that this is a limited Bill. I wish that the noble and Lancastrian Lord had gone for the Lancastrian approach and been absolutely candid and answered the questions. In the meantime, I accept his reasoning and beg leave to withdraw the amendment.

Amendment 92 withdrawn.

Leasehold and Freehold Reform Bill

Lord Khan of Burnley Excerpts

Committee stage
Monday 29th April 2024 Lords Chamber

[Baroness Thornhill (LD)]

My Lords, I will speak to my Amendment 77 and make a few brief comments on other amendments. Amendment 77 would allow leaseholders to apply to the appropriate tribunal to ensure that freeholders who do not provide the agreed estate management services and allow a block to become run-down can be subject to a penalty at the sale of the freehold. There is clearly an issue of absent freeholders and little penalty when a managing agent is not appointed or adequate estate management services are not provided. The amendment would create a mechanism by which a penalty could be placed on the enfranchisement value and mean that leaseholders who have suffered from freeholder failures and consequently had to take the step towards acquiring the freehold should pay a lower cost for the collective enfranchisement of that freehold. This would reflect the freeholder’s dereliction of duty if a tribunal deemed it was warranted.

The Bill aims to remove barriers and rebalance legal costs for leaseholders to challenge freeholders at tribunal. Clause 56 addresses the enforcement of freeholders’ duties relating to service charges, and it includes provisions for tenants to make an application to the appropriate tribunal and the measures tribunals may put in place. As such, the amendment would just add to that. As well as having a power to make a landlord pay damages to a tenant for failure to carry out duties related to service charges, a tribunal would also have the power to apply a penalty to the enfranchisement value at the sale of the freehold to leaseholders. It does not seem fair, after having taken action to gain control of the freehold due to an absent freeholder, that leaseholders then have to compensate the freeholder with no penalty for that dereliction of duty. This is a modest amendment that would leave the judgment in the hands of the appropriate tribunal as to whether a penalty was warranted.

On Amendments 67 and 69, in the name of the noble Baroness, Lady Taylor of Stevenage, it is only right that leaseholders with old leases that have fixed service charges can challenge the reasonableness of those fees at tribunal. Evidence of costs being passed on in service charges is evident. This also ties in with Amendment 98D from the noble Earl, Lord Lytton.

We on these Benches support Amendment 69. We do not agree with the Government having a power to remove certain landlords from being subject to basic service charge transparency rules; all leaseholders are owed clarity on what they are paying for. We do not understand why that should not be the case.

I turn to Amendment 78 from the noble Baroness, Lady Fox of Buckley. We agree that leaseholders should be fully consulted on major works that they pay for; the noble Baroness showed that some of these costs are eye-watering. We agree with her proposal to restore the major works scheme in the Commonhold and Leasehold Reform Act 2002, which was eviscerated by the Daejan ruling by the Supreme Court in 2013, which the noble Baroness mentioned. We agree with the dissenting Lord Wilson in that decision, who said that the majority had subverted the intention of Parliament. It is not right that landlords no longer have to involve leaseholders in the decision-making process. We should use this Bill to at least restore the position to pre-Daejan so that transparency and accountability on major works are increased for leaseholders.

Amendment 78A, from the noble Lord, Lord Bailey of Paddington, would require a landlord who had lost a service charge determination, and who was meant to return the money to the leaseholders, to pay up in two months or else face compound interest. While Section 19(2) of the 1985 Act requires that overcharges be returned to leaseholders, landlords can and do ignore this. The same applies to similar provisions in leases. Where a tribunal has determined that a service charge or portion of it has been excessive, it should be relatively straightforward for leaseholders to get that money back. We on these Benches support that part of the thrust of the amendment—to ensure that landlords are under pressure to account to leaseholders in a timely manner, or otherwise experience financial penalties, as debtors in other parts of our economy do.

I turn to the mighty avalanche of amendments from the noble Earl, Lord Lytton. For us, Amendments 78D and 78E stand out. Amendment 78D provides for a new, tighter and more objective test of value for money to replace the current test of “reasonably incurred”, which could be open to a wide range of interpretation—obviously, this is in relation to service group charge costs. Amendment 78E pushes the Government to go further in the entitlement of leaseholders to have more and better information. Given the rationale behind the amendments from the noble Earl, Lord Lytton, we believe it is worth the Government giving them serious consideration.

Finally, although we have not yet heard from the noble Lord, Lord Moylan, we are minded to agree with his amendments, as right-to-manage and residential management companies are thinly capitalised. Unlike big freeholders, they will not have lending facilities, so would be unable to pay legal costs up front to take non-paying leaseholders to tribunal or county court. Right-to-manage and residential management companies are non-trading companies and have nothing except the service charges in their coffers. I look forward to the Minister’s responses.

[Lord Khan of Burnley (Lab)]

My Lords, I rise to speak to Amendments 67, 69, 76, 78I and 78J, in the name of my noble friend Lady Taylor of Stevenage. Noble Lords across the House have been emailed and briefed in relation to some very troubling real-life examples in the area of service charges—in fact, we heard earlier from the noble Baroness, Lady Fox of Buckley, about an unscrupulous situation.

In the other place, honourable friends have shared some horrific casework examples which clearly expose the unfit and unjust system leaseholders have been subject to. My honourable friend Matthew Pennycook MP, said:

“Soaring service charges are placing an intolerable financial strain on leaseholders and those with shared ownership across the country. Among the main drivers of the eye-watering demands with which many have been served over recent months are staggering rises in buildings insurance premiums and the passing on of significant costs relating to the functioning of the new building safety regime. Given that many leaseholders are being pushed to the very limits of what they can afford, do the Government now accept that the service charge transparency provisions in the Leasehold and Freehold Reform Bill … are not enough, and that Ministers should explore with urgency what further measures could be included to protect leaseholders better from unreasonable charges and give them more control over their buildings?”—[Official Report, Commons, 22/4/24; col. 636.]

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I also thank the noble Earl, Lord Lytton, for his Amendment 80B, which aims to prevent the misuse of insurance proceeds in the event of a claim. The noble Earl may have a particular case in mind, and I agree with his intentions, but I am of the view that such misuse is already prohibited. The creation of a new statutory offence, therefore, is not necessary. The amendment as drafted, although well meaning, would not lead to rogue landlords changing their behaviour. I hope that, with these reassurances, the noble Earl will not press his amendments.

[Lord Khan of Burnley (Lab)]

My Lords, I know that the Minister has been speaking for a while, but I want to press her on this important point as we are talking about charges. There is a huge, fundamental area of concern in that the ground rent consultation has yet to be published. I know that it is unreasonable for me to ask the Minister to talk about any leaks or media announcements. However, how will this House be able to scrutinise it at this late stage of the Bill’s passage?

[Baroness Scott of Bybrook (Con)]

We debated ground rents last week, and I do not have anything to add. If there are any changes to the Bill, we will give sufficient time for all noble Lords to consider them.

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[Lord Moylan (Con)]

My Lords, I had assumed that the noble Baroness had risen to speak to the amendment standing in the name of her noble friend Lady Pinnock. I will speak to the amendments in my name in this group. Although there are eight of them, they fall into three broad topics, so I hope to dispose of them fairly quickly.

The first are Amendments 81 and 81A. These relate to the ability of right-to-manage companies to bring legal proceedings and charge the costs to the service charge. The effect of the Bill is that freeholders will not be able to charge legal costs to the service charge unless they obtain a ruling from a tribunal. In the case of right-to-manage companies exercising the functions of the freeholder, they have no source of income apart from the service charge. If they are not able to charge their legal costs to the service charge, then they will not be able to bring legal action at all. In fact, without that ability, they would not even be able to initiate legal action unless the directors of the company were willing to fund the preliminary legal activities from their own pockets. If they were willing to do that, and they proceeded to court, they might find that the court or tribunal did not find that they were entitled to recover their costs or find that they could recover only part of their costs as a result. Again, they would have no recourse to any source of funds apart from their own individual pockets in such circumstances.

The second amendment, Amendment 81A, would extend this provision not just to right-to-manage companies but to residential management companies. Right-to-manage companies were established under the Commonhold and Leasehold Reform Act 2002, but there are other residential management companies that exist that are not right-to-manage companies under that Act. These two amendments are alternatives; they are both probing.

I have heard that the Government are aware that this is a problem and are willing to do something to address it, so I hope that this particular probe will find a positive response from my noble friend on the Front Bench, because it cannot seriously be the Government’s intention to make it virtually impossible for anyone to become a director of a right-to-manage company without having to face serious personal financial risks that were never envisaged when RTM companies were established in 2002.

Amendments 81B, 81C, 81D and 81E all work together. They relate to a different problem, which is that the Bill allows a court or tribunal to award costs to a freeholder in certain circumstances specified in the Bill. However, if these costs are not paid, the only recourse the freeholder has is to go back to the court and seek a new judgment to have the costs awarded to them, whereas the normal method of dealing with such a matter is to make a simple online claim for a judgment in default. That course of action is precluded, as I understand the Bill, in the case of freeholders seeking to recover the legal costs that have been awarded to them. All this will do is burden the courts with more applications, which can and should be, and are normally, dealt with through an online process that takes a few weeks to go through. That surely should be available to freeholders.

The third topic in this group relates to Amendments 82A and 82B. These, again, are probing amendments to understand why the Government are extending the protection in relation to legal costs to all leaseholders, when surely the intention must be to extend it to those leaseholders who are home owners—that is, who own the property that is the subject of the legal dispute. The Bill has the effect of giving this protection also to investor leaseholders—those who hold the property entirely as an investment. I do not understand the Government’s logic in doing this, and these amendments probe that by suggesting that it should benefit home owners only.

[Lord Khan of Burnley (Lab)]

My Lords, I thank the noble Lord, Lord Bailey of Paddington, for introducing this group, setting the context for this debate about insurance payments and asking for clarity in relation to his amendment, which I am sure was also the intention of the noble Lord, Lord Moylan, in asking for clarity with one of his amendments and probing efficiency in his other amendments. I agree with the noble Baroness, Lady Thornhill, about the extortionate increases in insurance charges passed on to leaseholders. We found that the risk price that insurers charged between 2016 and 2021 pretty much doubled. The brokerage charge increased by more than three times. The service charges added on increased by about 160%, so they more than doubled, and those charges were passed on to leaseholders.

I will quickly speak to Amendment 82, in the name of my noble friend Lady Taylor of Stevenage. This new clause would prohibit landlords from claiming litigation costs from tenants other than in limited circumstances determined by the Secretary of State.

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[Baroness Thornhill (LD)]

My Lords, I support Amendment 84, in the name of the noble Baroness, Lady Fox of Buckley. There is no doubt that mis-selling of leasehold homes is going on. Indeed, some developers insist that you can buy a flat from them only if you go with one of their approved solicitors. These solicitors will most likely not alert you to the negative aspects of that lease. Public awareness and understanding are low, as the noble Baroness showed from personal experience. The noble Baroness mentioned estate agents. I went on to Rightmove’s website and found that it provides buyers no search function to differentiate between freehold and leasehold homes, which I mention because, apart from this feeling disingenuous, it highlights that the problem starts at the very beginning of the process.

As has been mentioned, the Levelling Up, Housing and Communities Committee did an inquiry into leasehold in 2018-19. Its report said:

“Many leaseholders reported that they were surprised to learn that they did not own the properties they had purchased in the same way as they might have owned a freehold property. One leaseholder, Jo Darbyshire of the National Leasehold Campaign, told us there was ‘a fundamental lack of understanding about what leasehold tenure means to consumers out there.’ Shula Rich, from the Federation of Private Residents’ Associations, described leasehold as ‘the fag end of a timeshare … it is not owning anything’ and called for greater clarity from the Government and industry that purchasing a leasehold should not be sold as the ‘ownership’ of a property in the same way as freehold”.


They are leaseholders, not home owners, and they did not get help to buy or anything other than the right to live in a building for the term of the lease.

It is important that key information is provided in ways that are accessible and easily understandable for consumers. We believe that managing agents and landlords should provide key information about leasehold properties at the marketing stage in a standardised format. The information should include the lease length, estimates of enfranchisement costs, the ground rent and service charging information, as required by National Trading Standards for marketing a property.

There are clearly significant differences between freehold and leasehold tenures, but these are not always apparent to prospective purchasers at the point of sale. It has been mooted that it would be more appropriate to refer to this tenure as “lease rental”. We agree with that—it would at least be honest.

[Lord Khan of Burnley (Lab)]

My Lords, I rise briefly to thank the noble Baroness, Lady Fox of Buckley, for introducing Amendment 84. The arguments that the noble Baroness made were the very reason why we should end leasehold and move towards commonhold. I hope the Minister can clarify some of the important concerns that she has raised.

[Lord Gascoigne (Con)]

My Lords, I thank the noble Baroness, Lady Fox of Buckley, for her Amendment 84, which seeks to ensure that potential property purchasers understand the ongoing obligations of a leasehold property they are thinking of purchasing. I share the noble Baroness’s concern that purchasers should know about service charges and ground rent before they move into their home. Speaking personally, I completely understand the stress and frustration when you receive a bill that you knew nothing about.

The National Trading Standards Estate and Letting Agency Team has developed guidance for property agents on what constitutes material information when marketing a property. This information should be included within property listings to meet their obligations under the Consumer Protection from Unfair Trading Regulations 2008. The guidance specifies that tenure and the length of the lease are material and therefore should be included in the property listing. Ongoing charges, such as service charges and ground rent, are also considered material, as they will impact on the decision to purchase. This means that purchasers get information on the lease and expected level of ongoing financial obligations when they see the property particulars, so before they have even viewed the property, let alone made an offer. In addition, the measures that we are including in this Bill to require leasehold sales information to be provided to potential sellers mean that conveyancers acting on behalf of sellers will be able to quickly get the detailed information they need to provide to potential purchasers. This would include information about service charges and ground rent, as well as other information to help a purchaser make a decision, such as previous accounts.

The Government support significant provision of advice for leaseholders through the Leasehold Advisory Service, an arm’s-length body providing free, high-quality advice to leaseholders and other tenures by legally trained advisers. The Government have also published a How to Lease guide aimed at those thinking of purchasing a leasehold property, to help them to understand their rights and responsibilities, providing suggested questions to ask and suggesting how to get help if things go wrong. This guide will be updated to reflect the provisions in this Bill.

Leasehold and Freehold Reform Bill

Lord Khan of Burnley Excerpts

Committee stage
Wednesday 24th April 2024 Lords Chamber

[Baroness Pinnock (LD)]

I thank the noble Earl for that intervention, because he is right in many cases. I am not a lawyer, but I know that the 1925 property Act made a huge change away from the old system, which was feudal at that point, and modernised property legislation. This Bill may do the same. In some instances, as we have heard this afternoon, it will have big consequences—for freeholders, in the context of this set of amendments. I accept that maybe there ought to have been—as we heard on Monday from the noble Lord, Lord Young of Cookham—a draft Bill on commonhold. Maybe it requires an in-depth, cross-House, cross-party committee to get into the detail, rather than the 300 or so pages of the Bill that we have in front of us, in order to get to grips with the consequences of what is being proposed.

I go back to the principle, and the principle has to be right. We are trying to rebalance the rights between freehold and leasehold. There is frequent talk on the Conservative Benches that the basis of Conservative philosophy is a property-owning democracy, but leaseholders will not be full participants in that until these changes are made. So it will be interesting to hear what the Minister has to say with regard to this very challenging debate.

[Lord Khan of Burnley (Lab)]

My Lords, this has been a more wide-ranging debate than was anticipated at the beginning of the group. The noble Lords, Lord Howard and Lord Moylan, made some interesting points in introducing their amendments, and it is for the Minister to clarify and address her noble friends’ concerns. All three amendments in this group attempt to make changes to Schedule 4, which is where the market- value element of the premium for any enfranchisement claim is determined.

I listened to the noble Baroness, Lady Fox of Buckley, in relation to the European Convention on Human Rights. Although we have differing views on that, it is interesting how legislation and the regard for international law are debated in different debates in this House—without pinpointing any noble Lord in particular.

The noble Baroness, Lady Deech, laid out and stipulated the complexity of the issue as a teacher in property law, while the noble Lord, Lord Thurlow, as a student of property law, made some interesting points about complexity and about working and bringing change in a fair manner.

In conclusion, I ask the Minister what consideration the Government have given to the principles of grandfathering for leases of various lengths and other conditions when developing the Bill? For example, in the instance of a lease of a very short length, when the Bill becomes law, what are the ramifications of the Bill as it is written? Do the Government think that some shorter leases are going to be treated in a way that may be fairer on wider principle but do not seem appropriate, given the shorter lengths? If so, did they consider any mitigation?

I finish by referring to my noble friend Lord Truscott, who advocated in a diligent manner the ending of marriage value and talked about the wider unfairness in leasehold properties. I look forward to the Minister’s response.

[Baroness Scott of Bybrook (Con)]

My Lords, I thank my noble friends Lord Howard and Lord Moylan for their amendments in this group. Amendments 26 and 27 would require marriage value or possible hope value to be payable by a leaseholder who has fewer than 80 years remaining on their lease on the passage of the Act.

The Government’s stated objective is to make it cheaper and easier for leaseholders to extend their lease or acquire their freehold. We want them to attain greater security of tenure. The amendments are directly counter to our objective. In particular, they would prevent us from helping the trapped leaseholder—that is, a leaseholder with a short lease who is unable to afford to extend because of the prohibitive marriage value payable, and so is trapped with an asset of diminishing value.

We do not believe that the leaseholder should have to pay marriage value. For the freeholder, the marriage value that is payable under the current law is a windfall created by the freehold and leasehold interests being married earlier than they otherwise would have been—namely, at the end of the lease. It is a sum that the freeholder would not receive if the lease ran its course. Parliament has previously determined that the value should be split equally and the leaseholder should pay half of it to the freeholder on enfranchisement, but we do not believe that freeholders should continue to receive that windfall.

The leaseholder needs to enfranchise, because by its very nature a lease is a wasting asset. Without either extending their lease or buying their freehold, they will suffer financial loss as the lease runs down or lose possession when it has fully run down. Nor has the lease- holder meaningfully chosen to enter such an arrangement, since leasehold is very often the only available form of tenure outside the rented sector at certain price points or in certain locations. The lease- holder’s need to enfranchise is born out of their insecurity of tenure; that is, out of the inherent injustice of the leasehold system. Our objective is to enable them to obtain greater security and to address that inherent injustice. By not having to pay marriage value to the freeholder, the leaseholder’s ability to obtain security of tenure is much improved.

A third party who bought the landowner’s interest would not pay marriage value, and we do not think it is right that the leaseholder should pay more than that same interest. Requiring leaseholders to pay more than a third party—or, in other words, enabling the freeholder to profit from the sale to a leaseholder by comparison to a third party—is to punish the leaseholder for their need to enfranchise, and therefore to affirm the very injustice we are trying to address.

The noble Earl, Lord Lytton, and many other noble Lords brought up compensation. Under our valuation scheme, the freeholder is compensated as if the lease simply ran its course. We believe that this is adequate compensation; it is sufficient to reflect their legitimate property interests.

Amendments 26 and 27 would also further complicate an already complex system. They would create a new two-tier system, with different rules for leases that were under 80 years at the time of the Act and those that fell under 80 years thereafter. This is undesirable, as it runs contrary to our stated aim to simplify this complex tenure.

Before I move on to Amendment 29, I will answer one or two specifics. First, the issue of human rights has been brought up by a number of noble Lords. The Government consider that all provisions in the Bill are compatible with the relevant convention rights and that in the case of the provisions engaging Article 8 and A1P1 any interference is justified and proportionate. There is a GOV.UK page where noble Lords can read further information on that should they wish.

The noble Baroness, Lady Deech, also brought up phasing, which is important. Following Royal Assent, we will allow time for a smooth transition to a new system, while making sure that leaseholders and freehold home owners on private and mixed-tenure estates— which is an issue—can benefit from it as soon as reasonably possible. We will also support leaseholders, freeholders, landlords and agents to adjust to and understand the new rules. We will work with delivery partners to make sure that the necessary support is in place, including through the publication of appropriate guidance.

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[Baroness Pinnock (LD)]

My Lords, for me, this is a very technical set of amendments, but they are very important. As we have heard, this issue can have significant implications.

I always go back to first principles. One of the aims of the Bill is to make enfranchisement cheaper than it is currently, and so more readily available. However, as we have heard, that will entirely depend on the deferment rate and how it is set. My understanding was that the current deferment rate was set by the Court of Appeal in 2007, as the noble Lord, Lord Young of Cookham, said. The debate is around whether it is right for that to continue; whether another process should be used, such as that proposed by the noble Lord, Lord Borwick, in his amendment about using the bank rate as a base for setting a deferment rate; or whether, as in the Bill, the responsibility is passed to the Secretary of State to determine the deferment rate. I have to agree with the noble Lords, Lord Moylan and Lord Young of Cookham, that the latter does not seem right.

When I was investigating the deferment rate issue, I noticed that Homehold Services Ltd gave evidence to the Commons Public Bill Committee that was very telling. It criticised the fact that the “applicable deferment rate” was referenced throughout the Bill

“without specifying what this will be”.

It provided an example of what effect a change in the deferment rate could have on the cost of enfranchisement. It said:

“A lease extension … on a £200k flat with 80 years unexpired and no ground rent would be c. £4,000”.


That is the example given by Homehold Services Ltd; as it is one of the experts, I thought it might be right. It continues:

“If the deferment rate was reduced from 5% to 4%, the premium would increase to c. £8,500. At 3.5% it would be … £12,000”.


Those small changes in percentages have very high consequences for the leaseholders. This is important—that is what the evidence told me when I read it.

The argument from Homehold Services Ltd was that the deferment rate must be set no lower than that set by the appeal judgment in 2007. Otherwise, the consequence is that the rate can escalate considerably, as the noble Lord, Lord Moylan, pointed out. The cost of enfranchisement would increase, removing the ability of many leaseholders to continue with the process—contrary to one of the objectives of the Bill. Can the Minister say what consideration the Government have given to the deferment rate?

The noble Lord, Lord Young of Cookham, said that the Chancellor’s department has had a consultation on this and come up with some figures. Why are those not being adopted in this instance to set the rate in the Bill? As we have heard, it is very important to know exactly what the deferment rate will be. I do not believe that it is satisfactory to leave the applicable deferment rate to be set by a statutory instrument some time in the future. Surely, if the Government’s intentions are as they are set out in the Bill—to make it cheaper for leaseholders to enfranchise—one of the key rates must be this one. Therefore, I would have thought that we would want to see it set during the course of this Bill, rather than wait for a statutory instrument.

I have a lot of sympathy with the arguments that have been made by the mover of the amendment and others about the need for certainty here, rather than a principle and uncertainty as to the exact figure at which the deferment rate will be set.

[Lord Khan of Burnley (Lab)]

My Lords, I will speak to Amendment 42 in the name of my noble friend Lady Taylor of Stevenage, which was well supported by my noble friend Lord Truscott in his earlier remarks.

Deferment rates are a phenomenally complex area to understand, and the standard valuation method in Schedule 4 is extremely technical. The Law Commission set out options. It did not make recommendations, but the Government have chosen to allow the Secretary of State to prescribe the applicable deferment rate. I thank the noble Lord, Lord Borwick, for his contribution and for seeking to make the process for setting the deferment rate more efficient and asking for more clarity and certainty.

Our amendment is clear and would ensure that, when determining the applicable deferment rate,

“the Secretary of State must have regard to the desirability of encouraging leaseholders to acquire their freehold at the lowest possible cost”.

We understand that the 2007 Cadogan v Sportelli judgment, which has broadly set deferment rates, was made in the context of 0.5% interest rates. If the Government are minded to remain of the view that the Secretary of State should fix the deferment rates, how best should they do that? Although it may work in London, what would need to be taken into account for other parts of the country? Is there a need to set multiple rates for different parts of the country to deal with the variations?

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[Baroness Pinnock (LD)]

My Lords, I congratulate the noble Lords, Lord Young of Cookham and Lord Berkeley, on exposing and exploring the exceptions to the general rule in the legislation and its application. If we live in a democracy, the rule of law should apply to everyone without heed or hindrance, so I am grateful to both noble Lords for bringing this to the attention of the House. I hope that when the Minister responds she will be able to confirm that the Bill will apply to the Crown Estate and the Duchy of Cornwall, because it ought to.

[Lord Khan of Burnley (Lab)]

My Lords, I rise briefly to thank the noble Lord, Lord Young of Cookham, and my noble friend Lord Berkeley for providing the detail, with diligence and eloquence, in calling for what the noble Lord, Lord Young, called a level and equitable playing field for all leaseholders in that situation, particularly in relation to Crown land. I want to press the Minister on getting information from the Government about to what extent Crown and Duchy of Cornwall land would be affected by the amendments, and on providing clarification on the important and pertinent points that both noble Lords raised.

[Baroness Scott of Bybrook (Con)]

My Lords, I will briefly speak to the amendments in my name before turning to the amendments in the names of my noble friend Lord Young of Cookham and the noble Lord, Lord Berkeley. Government Amendment 83 is a clarificatory amendment. Clause 67 outlines that all of Sections 18 to 30P of the Landlord and Tenant Act 1985 bind the Crown, and that the relevant provisions bind the Crown whether or not they relate to Crown land.

As a result, Section 172(1)(a) of the Commonhold and Leasehold Reform Act 2002 will be repealed. Since subsections (4) and (7) of Section 112 of the Building Safety Act 2022 amend the 2002 Act, these subsections are no longer necessary.

I now turn to the amendments in the names of my noble friend Lord Young, and the noble Lord, Lord Berkeley. I thank my noble friend Lord Young for his Amendment 54, which seeks to bind the Crown to the enfranchisement measures in the Bill and to apply those measures to properties subject to escheat. It is a long-established principle that legislation does not bind Crown lands, including the Duchies of Lancaster and Cornwall, unless the Act expressly states so or by necessary implication. Where an Act, or a part of an Act, does not bind the Crown, the Crown can and often does agree to act in accordance with the legislation.

The current position is that most Crown leaseholders enjoy the same lease extension and enfranchisement opportunities as other leaseholders, by virtue of the Crown’s undertaking given to Parliament to act by analogy with the Leasehold Reform Act 1967 and the Leasehold Reform, Housing and Urban Development Act 1993, which are not directly binding on the Crown. We also expect that the Crown will agree to act by analogy with the Bill before us. The effect will be that most leaseholders of the Crown will have the same opportunity to extend their lease or buy their freehold as any other leaseholder would, except in certain special circumstances set out in an undertaking we expect to be given by the Crown. Therefore, the outcomes the Government want to see can be achieved without legislation, and the amendment is unnecessary.

I would also like to thank my noble friend for raising an important point in his amendment about properties subject to escheat. The Government recognise that when the freehold becomes ownerless, it can cause problems for some of those leaseholders. However, the amendment would not achieve its intended aim because when a property escheats to the Crown the freehold no longer exists, and the Bill is not the appropriate place for a review of the complex law surrounding ownerless land. When a property becomes ownerless the land and buildings escheat to the Crown. If a purchaser is interested, the Crown can sell it so that it goes back into private ownership.