Park Home Residents: Legal Protection

John Healey Excerpts

Tuesday 1st October 2019 Westminster Hall

[Sir Christopher Chope]

My hon. Friend’s second point is a suitable subject for a separate debate. One problem is that the land on which the caravans are situated is in separate ownership from the caravans, so to introduce a right to buy that land might legally be quite complicated. Having said that, it has been suggested that, to get round the site licence provisions, some operators are offering long leases on the small area of land on which each caravan or park home is situated, which leads to the situation where each separate park home on a site has to have a separate site licence. That is the latest way in which the law is being stretched. At my suggestion, Bournemouth, Christchurch and Poole Council and the leasehold advisory group are interested in looking into the issue to see whether we will have a situation rather like the one we had with some Traveller sites, where an acre of field was divided up into lots of very small plots.

I am sceptical about my hon. Friend’s earlier point about the fit and proper person test. I will illustrate my scepticism by referring to the controlling director of Royale Parks Ltd. Robert Lee Jack Bull, born in May 1977, was appointed as the director of Royale Parks Ltd on 7 September 2018. Directly or indirectly, he holds between 25% and 50% of the shares and voting rights in that company, which is part of a complex group of companies. The information that I have seen from Companies House suggests that Mr Bull is the director of no fewer than 74 companies, which between them have assets of about £80 million and liabilities of about £110 million. Royale Parks Ltd controls 75% or more of the shares and voting rights in some of those subsidiary companies, such as Royale Parks (Dorset) Ltd. In marketing the properties, however, RoyaleLife describes itself as

“a family-owned business with a heritage dating back to 1945.”

There may be such a heritage, but what is probably not well known is that Mr Robert Lee Jack Bull was convicted at Cheltenham magistrates court on two pieces of information brought by the trading standards department, as described in the register for 10 January 2013. They are in similar terms, so I will refer only to the first one, which says:

“Between 13/08/2009 and 08/11/2009 at Gloucestershire, being a trader, engaged in a commercial practice which, by omission, was misleading under regulation 6 of the Consumer Protection from Unfair Trading Regulations 2008 in that its factual contract omitted material Information, namely by making representations to Phillip and Mary Bentall, being average consumers, with respect to a park home, 101 Cotswold Grange Country Park, Meadow Lane, Twyning, which representations caused them to take a transactional decision namely to sell their home at 32 Quay Lane, Hanley Castle and purchase 101 Cotswold Grange Country Park which they would not otherwise have undertaken if they had known that planning permission only existed for holiday homes at Cotswold Grange Country Park and that 101 Cotswold Grange Country Park was a holiday home, not a permanent residential property, contrary to Regulation 10 of said regulations and as a result caused or was likely to cause the average consumer to take a transactional decision he would not have taken otherwise.

Contrary to regulations 10 and 13 of the…Regulations 2008.”

Mr Bull was fined £4,000 on that and the other count, and ordered to pay costs and a victim surcharge.

If we go for a fit and proper person test, will Mr Bull fall foul of that test? I suspect that he would not, which shows the weakness of such a test. That is why I express openly my scepticism about it, but I think that if my constituents, certainly at Tall Trees, knew about Mr Bull’s background they would be very concerned, because many of them were the victims of mis-selling. They bought their park homes at Tall Trees around the same period, between 2009 and 2013, having been told that those park homes carried with them full residential rights over a 12-month period.

[John Healey (Wentworth and Dearne) (Lab)]

If the hon. Gentleman does not agree with the concept of a fit and proper person test, what does he propose to put in place to try to stop exactly the rogues that he has described in such detail to the Chamber?

[Sir Christopher Chope]

I am saying that I am not in favour of the fit and proper person test proposed by the Government. The alternative suggestion—I was going to refer to it, but I will now do so directly—is that the British Holiday & Home Parks Association, which is basically a trade body, should be given responsibility for introducing some policing in this area. The right hon. Gentleman will know that, as a result of the Parking (Code of Practice) Act 2019, which was introduced by my right hon. Friend the Member for East Yorkshire, rogue parking operators are no longer able to get access to the Driver and Vehicle Licensing Agency database unless they belong to the British Parking Association, an organisation that ensures high standards in the parking industry.

Similarly, we could have a situation where an organisation such as the BHHPA was able to enforce the fit and proper person requirements through its membership code, so that it would not admit into its membership organisations that fell below those standards. That might be a much more direct way of addressing this issue, rather than going down the route of the fit and proper person test. Which of those 74 companies to which I referred would be regarded as an unfit and improper company because of one director? This is a complex area, but the main point I would make is that the fit and proper person test is not the panacea that some people are suggesting it is.

In my capacity as the chair of the all-party parliamentary group on park homes, I am well aware of the laid-back attitude of many local authorities in discharging their responsibilities to park home residents. I have received lots of information from members of the public, including information on operators: the Elmstead Residential Park in Andover, Lakeview Residential Park in Romford and others frequently referred to in Private Eye. There are serious continuing problems. We will hear about some of them during this debate. Successive Governments have engaged in window-dressing gestures rather than taking effective action against the rogue operators.

The fit and proper person test may be just such an additional issue. I hope that the Minister, in his response to the debate, will be able to set out the Government stall in respect of what the Government will do to force local authorities to meet their statutory obligations, and to protect the many thousands of park home residents looking for a strong lead in this area. It is recognised that there are a large number of reputable park home operators, but there are still rogues operating in this industry.

--- Later in debate ---

[John Healey (Wentworth and Dearne) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Betts, as it was to serve under that of Mr Hollobone. Could you pass on our thanks to him? I enjoyed your team tagging at the start, just as I enjoyed the team tagging with the hon. Member for Christchurch (Sir Christopher Chope) to get us under way. I pay tribute to him for securing the debate.

This is a significant issue. The hon. Member for Christchurch is the chair of the all-party group, which is industry backed. It is highly significant that we heard from him and others the detail of the way in which park home owners and residents are systematically ripped off by some site owners, as well as his call for legislation and tougher enforcement and sanctions.

I welcome the hon. Member for Thornbury and Yate (Luke Hall) to his place in what may be his first debate as Under-Secretary of State for Housing, Communities and Local Government, and I congratulate him. There were 10 Tory MPs present at the start of this debate—I had not realised quite how compelling the debate would be compared with the attraction of the Conservative party conference in Manchester. I just hope everyone got refunds on the rooms they booked and had to cancel.

We have heard again today why an estimated 85,000 park home owners require better protection, stronger rights and Government action. Many of the residents are older people on low incomes, and they are without the means of redress that we would expect to be available to residents in any well-functioning market. The speakers in the debate have listed some of the common problems: unlicensed sites; lack of rights and means of redress for park home residents; unfair pitch fees and unjustifiable increases, sometimes annually; mis-selling, with some site owners encouraging those buying a home on their site to use their lawyers in the transactions; indefensible rules that allow site owners a take or commission of up to 10% when people sell their home; rogue park owners resorting sometimes to bullying, thuggery and even criminality; and, as my hon. Friend the Member for Stroud (Dr Drew) said, a lack of clear, independent advice from Government to park home residents and owners.

I say to the hon. Member for Christchurch (Sir Christopher Chope) that, given the vivid and detailed descriptions we have heard of the deep problems in the market, a membership code for the trade body’s members is not sufficient to resolve those problems—it simply will not cut it. A fit and proper person test may not be the single solution, but it must be part of the system to deal with what he described as rogue operators in the industry. My hon. Friend the Member for Leeds North West (Alex Sobel), from his constituency experience, powerfully made the case why a fit and proper person test must be part of the answer.

I enjoyed the contribution from the hon. Member for Strangford (Jim Shannon). As you well know, Mr Betts, he is probably the most regular contributor to debates in this House on housing generally and to debates on park homes in particular. He encouraged us to look to Northern Ireland and the experience in his area to see that we can work through co-operation, rather than confrontation. I hope that Ards and North Down Borough Council and his three park home site owners have responded to the current Government consultation. I also pay tribute to the hon. Member for Waveney (Peter Aldous), who spoke about how the Welsh have implemented tougher steps and how we in England can learn from them. I hope that the Minister will heed some of the practical points his hon. Friend made.

The hon. Member for North Cornwall (Scott Mann), who has now left, and the hon. Member for North East Derbyshire (Lee Rowley) both pointed out that the best site owners are dragged down by the worst. The hon. Member for Worthing West (Sir Peter Bottomley), who has also left, said that for too long there has been too little action by the Government. I regret the fact that the hon. Gentleman is correct: no progress has been made in the past decade. As you will remember, Mr Betts, I was the Housing Minister in the Labour Government in March 2010, when we published the conclusions of a consultation we undertook on park home regulation, including proposals and plans for a new fit and proper person test as part of new licensing requirements for park home owners, and a range of new offences relating to licensing, with tough financial penalties when the rules were not observed. However, as with so much else to do with housing, the Government who came to office in May 2010 were concerned first and foremost with cutting regulation and investment, and from that point on they resisted any case for new regulation and new rules, which have since proved to be necessary.

We have had a lost decade for housing and for park home residents and owners because of the lack of action. The only legislation to be passed in the past 10 years was not Government legislation, but the Bill introduced by the hon. Member for Waveney that became the Mobile Homes Act 2013. I pay tribute to him, but the fact is that, four years after that the passage of that Act—a qualified success, as he described it, but flawed—the Government had to undertake a consultation on what to do, and finally, in July, a full year after the consultation had concluded, they published their proposals. Will the Minister tell me today when the promised primary legislation will be introduced in Parliament? Will it be part of the Queen’s Speech in two weeks’ time?

With respect to the capacity of councils to do the vital enforcement job that all hon. Members have described, I say to the hon. Member for Christchurch that it is not necessarily that they are unwilling; given that the Local Government Association tells us that by next year councils will have lost 60p in every pound of their funding over the past 10 years, it is that at present they are unable. Will the Minister confirm how much will be available to councils to help to fund the new licensing role to accompany the legislation? Given that the problems that park owners face are part of the wider problems facing leaseholders who buy their home and find that they do not own it, will the Government back the plans that I have set out for Labour: ending leasehold on all new homes and giving existing leaseholders the legal right to buy their freehold for 1% of the property value?

This narrow issue, which nevertheless affects the day-to-day lives and prospects of tens of thousands of people, poses at a small scale the bigger choices that the Government face. The housing market is broken, and the Government must decide whose side they are on: whether they will remain, as they have been for the past 10 years, on the side of the commercial developers, the big landowners, the private landlords and the managers of park home sites, or whether they are—as Labour is—on the side of the hard-pressed homeowners, the first-time buyers, the leaseholders and the park home residents. I say to the Minister that it is “make up your mind” time, before the voters make up their mind at the next election.

[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Luke Hall)]

It is a pleasure to serve under your chairmanship, Mr Betts. I congratulate my hon. Friend the Member for Christchurch (Sir Christopher Chope) on securing this hugely important debate and on his work as chair of the all-party parliamentary group; I know that he has been and will continue to be a constant and powerful voice on these matters.

The park homes sector plays a crucial role in housing, particularly for older people; I say that not only as a Minister in my Department, but as a local MP who represents a number of park home operators and residents. Park homes provide a home for approximately 180,000 people across our country—mostly older people, many of whom are vulnerable, as has been referred to several times in this debate.

Some sites can be a dream move into the countryside, or by the sea in Christchurch, but we have heard too many examples today of that dream quickly becoming a nightmare. Hon. Members have raised numerous cases of exploitation, intimidation and coercion, and we know that some site owners exploit vulnerable residents financially through the use of complex ownership and management arrangements; I am aware of one case in which residents were asked to pay £40,000 per home for their written agreements to be renewed. Such practices are unjustifiable and unacceptable, particularly where the majority of residents are pensioners on low incomes whose park home is their only or main asset. All residents of park homes should be confident that they will be able to stay on their pitch as long as they choose to; they should not be worried about where to live or what unforeseen financial liabilities they may have in future.

We have seen vivid examples of the extreme misuse of variable service charges to extract ever more cash from those who may already be on low or fixed incomes, and I know of a case in which a resident lost their home and life savings as a result. There are examples of threats, intimidation and even violence to coerce residents into selling their homes way below the market price. Even at the less extreme end of the spectrum, there are examples of the market simply not functioning as it should. Some of them have arisen or been able to persist partly because the park homes sector is unique; over the decades, the sector has evolved much faster than the legislation we have passed to govern it, and there has been insufficient understanding of and information about the rights and responsibilities of park owners and residents. That has created a huge number of problems, which we are committed to resolving.

A unique aspect of the sector is the crucial relationship between the site owner and the resident. When it becomes unconstructive, as it has in the past, it leaves some residents exposed to unscrupulous site owners, which is why strong legal protections are necessary and why the Government continue to take the matter seriously. Legal protections are of course in place. The 1983 Act, which we have discussed this morning, gave residents security of tenure, which means the site owner can end the agreement only for certain reasons and with the approval of the courts. Although the legal changes were important, they clearly failed to address a lot of the overarching challenges in the sector. That is why the 2013 Act, introduced by my hon. Friend the Member for Waveney (Peter Aldous), strengthened the rights and protections of residents and gave local authorities more enforcement powers. There was a new process for selling mobile homes, which required the use of statutory forms to reduce the potential for sale blocking; the new pitch fee review process; and a new process for making sure that, when new site rules were introduced, residents were consulted.

We have also banned certain types of site rules that give site owners an unfair advantage. We have given local authorities more powers to issue compliance notices, which we have heard a lot about this morning, to carry out necessary work to the site, or face prosecution or an unlimited fine. To better tackle instances of harassment, the 2013 Act strengthened the criminal law by removing the requirement that acts of harassment have to be persistent before a prosecution could be brought by a local authority. Such measures have led to tangible improvements in the lives of many residents, although it has been highlighted again today that there is still a huge amount of work to do to improve the lives of park home residents and to really make the sector work.

The Government want to go further. In 2018, we conducted a review of the park homes legislation to understand how far the 2013 Act had gone towards addressing the overarching issues in the sector and to help expose what more can be done. We have been strong in our response. First, we said we would consult on the technical detail of introducing a fit and proper person test. There has been much discussion about that this morning. We are certainly committed to learning the lessons of what happened in Wales and making sure that the test is as thorough and fit as it can be. I certainly take on board the representations made about that by hon. Members in the Chamber this morning. The consultation closed on 17 September and we are now analysing the responses. We will seek to publish the Government response as soon as possible. We will certainly make sure that that is done by the end of the year. In answer to the question asked by the shadow spokesman, the right hon. Member for Wentworth and Dearne (John Healey), the statutory instrument will be laid before the House as early as possible next year, subject to parliamentary time.

[John Healey]

Is the Minister saying that the only legislation he has in mind is a statutory instrument and not primary legislation?

[Luke Hall]

Not at all. Perhaps the right hon. Gentleman will bear with me for a minute or so.

Secondly, we said we would establish a park homes working group, and we have done that. The group has been working since October last year to explore how rights and responsibilities can be communicated more widely and administrative processes improved. Thirdly, we said we would conduct research into the 10% commission charged on the sale of park homes, and I expect that to be under way by the end of this year. Finally, we will introduce primary legislation to address other challenges in the sector, including issues such as the definition of a pitch fee, the use of variable service charges and the use of complex company structures that can limit a resident’s security of tenure.

--- Later in debate ---

[John Healey]

I am grateful to the Minister for giving way again. Will he confirm that, given the working group and the research still to be commissioned, the primary legislation will not be in the Queen’s Speech in two weeks’ time?

[Luke Hall]

At the moment, the assurance I can give the right hon. Gentleman is that a statutory instrument will be laid before Parliament early next year and there will be legislation as soon as parliamentary time allows. I am sure the Minister for Housing will be happy to provide further clarity as soon as it is possible to do so.

I will briefly go into a bit more detail about two points I mentioned that are particularly pertinent. As we have heard, the sector is complex, highlighting the importance of the working group, which brings together local authorities, the British Holiday & Home Parks Association and the National Caravan Council, residents’ associations, LEASE and Age UK. A hugely important workstream for the group is on making sure that the communication of rights and responsibilities is as effective as possible.

We have talked about the age profile of a lot of people living in park homes. One of the important things for us to consider and remember and for the working group to ensure—certainly, it is in its recommendations to us—is the availability of information not only online, through the technological formats that we would use, but directly on sites and in paper copies. The working group has recommended that my Department should produce a single source of information and that all park home owners should be aware of it. The work is fully in train and will be made widely available, including paper copies.

I should like to give more detail about the introduction of the fit and proper person test. There was overwhelming support—not 100%, but overwhelming—for the introduction of such a test, in the review of legislation. We are committed to bringing it forward and putting it into effect, subject to the results of the technical consultation that closed on 17 September. We received 369 responses, 267 of which were from park home residents themselves—a good proportion. We also had representations from the legal sector, representative bodies, local authorities and the site licensing officers’ forum. We are looking at the responses now and will publish them before the end of the year.

During the debate, the hon. Member for Strangford (Jim Shannon) asked whether the Department could make contact with Ards and North Down Borough Council. I am more than happy to make sure that that happens and would like to pass on my thanks to Councillor Edmund for the work that has been done in his area. My hon. Friend the Member for Waveney talked about the availability of guidance and advice and about the importance of making sure the working group information is available as quickly as possible. I assure him that the Minister for Housing sees that as a priority.

My hon. Friend the Member for North East Derbyshire (Lee Rowley), who talked about the importance of the fit and proper person test, made a pertinent point about the joining up of local authorities and the conversations that they should be having. I shall make sure that that point is taken away.

My hon. Friend the Member for Christchurch raised some extremely pertinent points and I shall ask the Minister for Housing to investigate them all fully in advance of their forthcoming discussion.