Leasehold Reform (Amendment) Bill

Baroness Stowell of Beeston Excerpts

Friday 7th February 2014 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Stowell of Beeston) (Con)]

My Lords, I share and echo the comments of noble Lords in congratulating my noble friend Lady Williams of Trafford on, and thanking her for, introducing this Bill. I hope that she will not mind me informing your Lordships that this is the first time that she has spoken in the Chamber, and I do not know how many other Members of your Lordships’ House have spoken for the first time in the Chamber while being responsible for a Private Member’s Bill. She gave her maiden speech in Grand Committee in the Moses Room, so this is an occasion all on its own, even though the Bill is important.

I, too, must declare my interest as an owner-occupier of a leasehold flat. Like other noble Lords have done, I should mention the good work of my honourable friends in the other place, David Nuttall and Philip Hollobone, in introducing and leading the Bill. I congratulate them on the progress it has made so far. I am pleased to say that the Government fully support the Bill as it stands. Some brief and well targeted amendments that were brought forward in the other place by the honourable friends I mentioned, jointly with my honourable friend the Housing Minister, have ensured that the Bill can effectively achieve its worthwhile aim.

Importantly, the Bill will, if it reaches the statute book, affect only the position in England, not in Wales—housing being a devolved matter. This is probably the right moment to respond to the point raised by the noble Lord, Lord McKenzie, about Wales. I urge Members of the Welsh Assembly to look at this legislation and consider it carefully. I do not believe that prior to the Bill coming forward—and, I hope, achieving Royal Assent—there is any discrepancy in terms of equality law, but clearly there will be a difference between the treatment of people in England and those in Wales who live in leasehold properties. I hope that the Assembly will look at what we are doing here and learn from it.

As my noble friend Lady Williams explained, the Bill aims, by amending Section 99(5)—

[Lord Richard (Lab)]

I do not quite follow the position regarding Wales, because it has been explained that Wales is deliberately excluded from the provisions of Bill. None the less, subsection (3) of Clause 2 states:

“The Act extends to England and Wales”.

Does it?

[Baroness Stowell of Beeston]

The Act that is in place, which this Bill is amending, extends to Wales, but because housing is a devolved matter, the way in which we are amending the Act is specific, in that the amendment applies only to England. One might describe it as a convoluted way of going about it, as is sometimes necessary when amending legislation. However, the effect will be that the Act that this Bill is amending remains as it is and applies to England and Wales, but the specific amendment to the Act via this Bill will apply only to England, because we cannot apply it to Wales. It is a devolved matter.

[Lord Richard]

The Bill states that the Act extends to England and Wales. Does it?

[Baroness Stowell of Beeston]

Okay, I see where the noble Lord is coming from. The Act extends to England and Wales but we cannot amend it in respect of Wales. Wales has to amend it for itself because it is a devolved matter. I hope that that clarifies the situation for the noble Lord.

[Noble Lords]

Oh!

[Baroness Stowell of Beeston]

I understand it—and the Government support the Bill.

As my noble friend Lady Williams explained, the Bill aims, by amending Section 99(5) of the Leasehold Reform, Housing and Urban Development Act 1993, to remove current restrictions on who can sign the legal notices required when leaseholders exercise certain statutory rights. At present, the leaseholder of a flat who wants to extend their lease or take part in acquiring the freehold of their block must personally sign the legal notices required. Currently, no one else is allowed to sign on behalf of a leaseholder who is physically unable to do so, even if they are acting under a power of attorney. This includes situations in which a leaseholder has become the subject of mental incapacity and the Court of Protection has issued a direction. This position has been confirmed by case law. I should say to my noble friend Lady Browning, on the point that she raised about testing, that it would not be necessary for anyone to test or prove mental incapacity on the part of the leaseholder in order for this Bill to assist them.

This Private Member’s Bill would enable the legal notices to be signed in future on the leaseholder’s behalf. In bringing forward this change, it will help a range of people. In response to a point that my noble friend Lady Gardner of Parkes raised about the extent of those affected by the Bill, they are relatively small in number, but our decisions to act should not always be based on the weight of the mailbag we receive. If the case to act is clear—which this Bill demonstrates—and the solution is simple and easy to administer, and doing so brings no downside to others, I am glad that this Government are able to offer their support.

In addition to the elderly and vulnerable, the removal of current restrictions would also be helpful to those who are charged with looking after the financial affairs of a leaseholder—for example, relations who are acting under a power of attorney. The Bill could also help some leaseholders living abroad who need to sign these notices. For example, work may take a flat’s leaseholder abroad for a period, and, without the ability to have someone act with appropriate authority on their behalf in respect of the property, it may be difficult for the leaseholder to exercise their statutory rights.

If individual leaseholders who live or work abroad are hindered in this way, that could have an unfortunate knock-on effect on other leaseholders in the block. Where, for example, several leaseholders want to exercise their collective right to acquire the freehold of their block, in order to satisfy the qualifying criteria they may need one or more leaseholders who live or work abroad to take part. While the Bill would not make any change to leaseholders’ rights, it might helpfully remove a practical barrier to the efficient exercise of those rights.

We have seen from the contributions made today that there is widespread support for the Bill and I hope that it will receive a fair wind during its onward progress. It offers help and hope to leaseholders who might otherwise face an insurmountable barrier to exercising their rights. In doing so, the Bill will assist the families and friends who care for vulnerable leaseholders and thereby give them greater peace of mind, too.

My noble friend Lady Gardner of Parkes has taken the opportunity to raise a number of interesting issues that are not directly related to the Bill. I am aware that a range of leasehold issues give my noble friend and others cause for concern, and she outlined some of them today.

The noble Lord, Lord Beecham, joined my noble friend Lady Gardner in raising the issue of commonhold. As the noble Lord knows, commonhold law is a matter for the Ministry of Justice rather than DCLG, but I shall certainly make my colleagues in the MoJ aware of the points that he raised, ahead of the Oral Question that my noble friend has tabled on the Order Paper for Monday.

I will reflect carefully on the points raised by my noble friend Lady Gardner of Parkes and discuss them further with my honourable friend Kris Hopkins, the Housing Minister. I hope my noble friend will feel that he is just as good at his job of Housing Minister as his predecessor. He is certainly interested in these issues and I hope that we will continue to have a constructive dialogue about the legitimate points she raised, which deserve full consideration.

The noble Lord, Lord McKenzie, asked about co-signatories to a lease. I can confirm that where there are co-signatories, it may be necessary for both to sign the notices in person. This Bill will assist in situations where one or more of the leaseholders is unable to sign in person. I am sure that my noble friend Lady Williams will confirm that when she responds.

I am pleased to give the Government’s support for the Bill. I hope that it will receive a Second Reading today, pass successfully on to its next stages in this House and in due course receive Royal Assent.

[Lord Skelmersdale (Con)]

My Lords, I wonder whether my noble friend can clear up the issue of Wales. It is my understanding that Clause 1 of the Bill specifically excludes Wales. Therefore, because Wales is mentioned in Clause 1, this Bill has to apply to Wales as well.

[Baroness Stowell of Beeston]

My noble friend is right. I thought I had clarified this matter in response to the noble Lord, Lord Richard, who asked the question previously. My noble friend is correct. The key point, I stress, is that the change this Bill is making affects only leaseholders in England. It does not affect leaseholders in Wales.