Leasehold Reform (Ground Rent) Bill [HL]

Baroness Ritchie of Downpatrick Excerpts

Committee stage
Monday 14th June 2021 Grand Committee

I will throw in one last suggestion. As the Duchy claims to be in the private sector, perhaps its name should be removed from Clause 23(2)(c) and it should be treated, at least for the purposes of leasehold reform, in exactly the same manner as every other private landlord in the country.

[Baroness Ritchie of Downpatrick (Non-Afl) [V]]

My Lords, I support Amendment 19, in the names of the noble Lords, Lord Kennedy of Southwark and Lord Lennie, and Amendment 20, in the name of the noble Baroness, Lady Pinnock.

Like other noble Lords, I pay tribute to the 72 people who lost their lives in the Grenfell tragedy some four years ago. There have been many lessons from that tragedy for housing management purposes, and I hope that the Government and housing organisations learn much from them.

As it currently stands, this legislation will undoubtedly have a potential long-term financial impact for existing long-term leaseholders, as they will be excluded from it. I agree with the noble Lord, Lord Lennie, who said that, while the legislation is welcome—I definitely welcome it, and the Northern Ireland devolved authorities introduced similar legislation—it barely scratches the surface. There is no doubt that existing leaseholders will have to pay onerous ground rents with no sense of freehold. Amendment 18, which the noble Lord did not move, referred specifically to the need to remove ground rent for all leaseholders.

This legislation is quite limited and the Government have promised other legislation. When will that be brought forward? Can the Minister give us a revised timeframe with exact dates therein? The delay in bringing forward this limited legislation and the need for other aspects in relation to enfranchisement were raised at Second Reading and again today. I welcome the Bill’s proposals, but I feel that enacting the amendments would ensure that the Government could bring forward legislation at a later stage and provide the important financial assessment on the holders of long leases that is urgently required.

To introduce fairness and equity into the property market, the new clause introduced by Amendment 19 should be accepted by the Government to ensure that an assessment takes place of the financial impact for tenants in long leases of dwellings that examines lease forfeiture, transfer fees, redress schemes and enfranchisement. The Law Commission report made recommendations in respect of enfranchisement following promises by Theresa May’s Government in 2017 to tackle unfair and unreasonable abuses of leasehold, particularly the sale of new leasehold houses and onerous ground rents. With the legislation applying only to new leases, why are the Government allowing developers to exploit home owners through exorbitant ground rents? Why the piecemeal approach to this legislation? Why did the Government not bring forward more comprehensive legislation?

I believe the Government should accept Amendment 19. If enacted, it would enable the Government to have an assessment of the current housing situation to indicate whether further legislation to ameliorate the situation is required. I fully agree with Amendment 20, in the name of the noble Baroness, Lady Pinnock, which tries to help those facing fire remediation work. Again, I think of the whole area of Grenfell.

There is also a view in some quarters, particularly in the management of the property sector, that the government impact assessment accompanying this Bill demonstrates the negative impact of this legislation on the housing market: increasing house prices and creating more barriers to entry for consumers trying to get on to the property ladder. It has been suggested that, without proper and careful consideration of the detail and, in particular, the effects of these changes on apartment buildings, this legislation could have far-reaching implications across a range of issues, including building management, accountability and, crucially, the safety of apartment buildings. This is on top of the immediate impacts on the price of flats and the ability of prospective owners to buy new builds, which have been revealed in the impact assessment. Would it be possible for the Minister to comment on these observations in relation to the management of the property sector? Do the Government have any solutions in mind?

I look forward to the Minister’s answers to all these questions. I support the amendments in the names of my noble friends Lord Lennie and Lord Kennedy of Southwark, and of the noble Baroness, Lady Pinnock.

[Baroness Jones of Moulsecoomb (GP) [V]]

My Lords, I regret to say that I found the Minister’s rejection of the previous group of amendments extremely thin. I have always been puzzled why, when we have so many experts in your Lordships’ House—I do not include myself in that number—the Government would not listen to common sense and accept amendments that would have an impact and massively improve the legislation. I very much hope that we will bring these amendments back on Report and win a majority of the House round, so that the Government have to listen and improve the legislation, which is extremely thin.

When I was on the London Assembly, I was chair of the housing committee at one time. Just a few years before Grenfell we had a very similar incident in the area I lived in. Because it was so close to me, I was able to visit the block and see the problems. The housing committee wrote a short report and, although very short, the things we found wrong with the building—Lakanal, down in Camberwell—were almost exactly the same things that went wrong at Grenfell. We could have learned from Lakanal; we could learn from Grenfell and the awful death toll experienced there. We have to say that we cannot let people get away with making the same mistakes again and again.

It is welcome that the Bill bans exploitative ground rents in new leases, but it offers absolutely nothing to the thousands of leaseholders already trapped in exploitative ground rent arrangements. I think in particular of the dreadful time that the thousands of residents in hundreds of flammable apartment blocks are currently experiencing. Again, I do not live in such a block and do not have a vested interest. There is sheer chaos and uncertainty, particularly in blocks recently deemed safe but which have since been re-categorised as dangerous and needing expensive remedial work. Many of these blocks now need waking watches to patrol 24 hours a day—a little bit like in your Lordships’ House—and ensure that the building is evacuated in the event of fire. Fire systems that were previously deemed state of the art are now considered woefully inadequate and have to be totally replaced, so that every single apartment unit is individually alarmed.