Greater Manchester Spatial Framework and the Green Belt

Jonathan Reynolds Excerpts
Wednesday 18th March 2020

(1 year, 7 months ago)

Westminster Hall

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Department for Levelling Up, Housing & Communities
James Daly Portrait James Daly
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18 Mar 2020, 2:38 p.m.

My hon. Friend speaks very powerfully on this issue and I agree with every word that he said.

I also bring to the Minister’s attention the fact that 2016 Office for National Statistics population forecast figures revised down Bury’s population by 43%, and recently released 2018 provisional figures show a further fall of 13%. On the basis of recent population projections, no homes would have to be built on the green belt in my constituency. Will the Minister confirm whether the Government will review the use of projections published six years ago?

Jonathan Reynolds Portrait Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
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18 Mar 2020, 2:39 p.m.

I congratulate the hon. Gentleman on securing the debate. The issue of “brownfield first” quite rightly comes up all the time and, as an Opposition MP, I point out that, in fairness, that is the Government’s policy. Certainly, in my constituency and in the Borough of Tameside, almost every bit of brownfield land has been found for use, even if its viability is borderline. Is the hon. Gentleman saying that the Government should find more money to make unviable sites viable, or is he saying that we should build fewer homes in Bury, Tameside, Greater Manchester and so on? Those are two different ways to solve the problem, and I want to understand his approach.

James Daly Portrait James Daly
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18 Mar 2020, 2:44 p.m.

There are three questions in the hon. Gentleman’s intervention. I have already commented on the funding that the Government are making available to assist local authorities in remediating brownfield sites—that will be very important. The question comes down to housing need. It is the easiest thing in the world simply to say, “We need to build more houses,” but we need a robust formula that allows each local authority to build the number of houses that they need and where they need them over the course of a local plan. I am making the point that using the most up-to-date population projections reduces the need to build on the green belt, and in my borough—I am sorry, I cannot comment in respect of the borough of the hon. Member for Stalybridge and Hyde (Jonathan Reynolds)—that would allow properties to be built on brownfield sites.

The question, though, is the “brownfield first” policy. “Brownfield first”, again, is a statement, but there is nothing within the GMSF to force councils to build on the brownfield first. If the GMSF was in place, the green belt would undoubtedly be concreted over and no developer would be interested in building truly affordable homes on brownfield sites.

Coming back to the point, we have to build homes for people who need them, at a price that is affordable, in the right place. In the GMSF in respect of Bury, there was virtually no comment regarding building affordable flats in the town centres within my borough. That is one of many reasons why I believe the document is not fit for purpose.

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James Grundy Portrait James Grundy (Leigh) (Con)
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18 Mar 2020, 2:53 p.m.

I have grave concerns about how my own local authority, Wigan Council, has conducted itself during the Greater Manchester spatial framework process. When the plan’s first draft was announced, many local farmers and landowners were surprised to find that their land was earmarked for development. They had not put forward their land during the “call for sites” process. They had not even been consulted on whether their land should have been included in these plans.

When the landowners attended a public information event to protest the lack of consultation, they were told initially that, should they refuse to sell, the council would rely on the use of compulsory purchase powers to obtain the land. Following a public backlash against this approach, both the leader of Wigan Council and Andy Burnham, the Mayor of Greater Manchester, stated that they would not using compulsory purchase powers after all.

The council has still not removed all these sites from the plans, however, which raises two issues: first, the deliverability of these sites and secondly, housing supply if these sites are allocated but not deliverable. Wigan Council’s approach towards the GMSF has generated an unworkable plan because of the lack of due diligence in ensuring site availability, a lack of consultation with the affected landowners, and an unwillingness to compromise when this was highlighted. I hope that measures can be put in place to ensure that this situation does not arise again.

Jonathan Reynolds Portrait Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
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18 Mar 2020, 2:59 p.m.

I had not intended to make a speech—but if there is an opportunity, why pass it up? It is good to have this debate with new colleagues who have come in as a result of the election; obviously, that change of composition is not entirely favourable to the Opposition side of the Chamber, but it is good to be having this discussion again.

It makes sense to do this housing plan together. Between the two speeches we have just heard, I could not help but notice that one of the attractions of a GMSF-style plan for boroughs such as Tameside, Oldham, Bolton and Stockport is that it transfers that housing allocation into, in the main, Manchester and Salford. If we are not to have the plan for Bury and we are not to have the plan for Salford, that presumably means fewer houses for Salford, but more for Bury. That has to be acknowledged and admitted.

Mary Robinson Portrait Mary Robinson (Cheadle) (Con)
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18 Mar 2020, 2:59 p.m.

Of course, we are discussing the Greater Manchester spatial framework in the round, which encompasses the 10 local authorities that would be working with the Mayor of Greater Manchester to put this in place. One problem has been that where there are some pluses—for instance around common ground, which would allow movements between the various areas—that is very much top-down driven, so we are waiting for the Labour Mayor of Greater Manchester to tell us what we should have. I have been working with local residents, my constituents and neighbourhood groups, including Woodford Neighbourhood Forum and Save Heald Green Green Belt, and they want to know what is going to be right for their area. That depends on having the right figures, so we really do need guidance on those figures, and to bear in mind that we want a spatial framework or local plans that fit the needs of our local populations.

Jonathan Reynolds Portrait Jonathan Reynolds
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18 Mar 2020, 2:59 p.m.

I am grateful for the hon. Lady’s statement, and I agree with her. There have been huge problems with process, and I cannot easily see how we correct those, because the honest truth about the way we do housing allocation in this country is that we start with a piece of agricultural land. The minute we make that a piece of housing land, we increase its value tenfold, and that value does not stay in the public sector: it goes to the private sector, despite the fact that there has been no productive capacity increase. It is simply an administrative change that makes people very wealthy, so how and when we release that information to prevent land speculation is clearly a massive issue.

The hon. Lady asked about the figures, which are really what the debate has been about for the past few years. To be honest, sometimes we have had clarification from Ministers, but when the written version has come through, it has been something completely different from what Conservative Back Benchers were told at the time. However, my understanding is this: the Government set a housing target figure for each borough. The hon. Member for Bolton West (Chris Green) said that local areas should do that, which would be a revolutionary change in how the Government approach housing allocation. I am not sure that is where this Government are going, for the simple reason that if that system were to exist, I cannot imagine that the Government’s housing targets would get anywhere near fulfilled. Many parts of the country, particularly in the south-east, would just refuse to build any houses at all, so I cannot imagine a situation in which there is not national Government guidance. If that is going to happen, we would like to know that, because it would be revelatory.

Once that housing target figure is assessed, it is possible to do something like what we are trying to do together in Greater Manchester: work out a different figure for each borough, based on re-organising and re-allocating some of that housing need around Greater Manchester. Once there is a figure for a borough, as we have for Tameside, we look at the housing land supply and try to get everything we can into that, so as to avoid touching the green belt. That is the Government’s policy: we cannot touch the green belt until we have as much of the brownfield land supply in as possible.

There are sites in my constituency that, to be honest, would require tens of millions of pounds to remediate, but we got them in there because building on them is the right thing to do. We presume that central Government will come to help remediate those sites and make them viable, but I am not sure that commitment will be infinite. I know the phrase “whatever it takes” is in vogue right now, but there are surely limits to what the Ministry of Housing, Communities and Local Government will give Greater Manchester to remediate all those sites. That is the point at which we get to the green belt.

Mary Robinson Portrait Mary Robinson
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18 Mar 2020, 2:59 p.m.

The hon. Gentleman is being very generous in giving way. One of our issues in Greater Manchester is that these areas have been allocated. I have allocations of green-belt housing of over 2,000 houses, so this is having a huge impact on my area, and people are fearful that the green belt is going to be built on. I have been pushing for “brownfield sites first”, and for a register in Stockport that should be entirely about building on those brownfield sites, but unfortunately, while those allocations are still in the Mayor’s plan, people feel we are going to have this housing there.

Jonathan Reynolds Portrait Jonathan Reynolds
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18 Mar 2020, 3 p.m.

I completely agree, but it goes back to the difficulties of the process. There are green-belt sites marked for allocation in my constituency that I oppose; Apethorn Lane, effectively, is the land between Stockport and Tameside. I have nothing against people from Stockport, but I want to maintain that green-belt barrier between us. We are close enough as it is.

Robert Largan Portrait Robert Largan (High Peak) (Con)
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18 Mar 2020, 3 p.m.

I am grateful to my constituency neighbour for giving way. Members might look a little surprised, given that I do not represent a Greater Manchester constituency. However, my constituency is right on the border and homes built in places such as Tameside or Stockport have a big impact on commuters in my seat, particularly on the A6 or through Mottram to try to get on the M67.

A big complaint has always been that we put in houses without the infrastructure to cope with them. To praise the GMSF—slightly unusually—one good thing is the proposal for a Gamesley railway station that is included in it. Will my constituency neighbour have words with his colleague, Andy Burnham, to see whether he can throw his full support behind that station, and will the Minister have words with the rail Minister about getting a train station built in Gamesley?

Jonathan Reynolds Portrait Jonathan Reynolds
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18 Mar 2020, 3 p.m.

It is great to see the hon. Member for High Peak (Robert Largan) here. To be frank, in Tameside we might say it is houses built in Derbyshire that have put infrastructure burdens on to us, but the fact that it is relevant to his constituency and his towns shows why this debate is so important.

We all agree on the crucial point about infrastructure and about how housing, if it is not organised through a plan like the GMSF, will be developer-led and of a size and scale that we would not necessarily want to see in our constituencies. I often tease Conservative friends about how they believe the market should determine lots of things, but apparently not, in this case, housing allocation.

Development is a huge problem. The speculative aspect—often seen as something that does not meet local needs and is not connected to local transport—is the biggest problem. I could see it coming from the minute I was first elected to Tameside Council. I was a Longdendale councillor on the border with High Peak. When I looked at housing policy, it was clear that we were running out of brownfield land sites. In Hyde we had built on all kinds of former employment sites, which, again, was the right thing to do, but that cannot go on for ever.

When we looked at what would inevitably happen in Tameside, we got to thinking about a garden village, where we would insist that, if were to allow housing to be built, it would come with infrastructure investment up front in schools and in transport—all the things that reflect the only time this country has ever done housing policy well, which is when the new towns were built after the war and then a few decades later. They were built in exchange for the establishment of the green belt. That was the deal. We built houses where the state and society wanted them to be. We demanded the infrastructure that goes with them and we would protect the rest from speculative development, particularly in an age when councils were incentivised to build houses because they got rates comparatively greater than they do now for the more houses that they allowed to be built.

Control is the key issue. I cannot fathom rejecting the GMSF altogether because it would mean more houses being built in places such as Bury. It would mean less control and our not working together. I cannot see the logic in that. Whether houses are built in High Peak or Stockport or anywhere else in Greater Manchester, they will have an impact on my constituency, so we have to start by saying, “Let us have a plan and work on it together. If it is not acceptable in terms of infrastructure or sites, we will work on it.”

If we do nothing, certainly in Tameside, we cannot guarantee the five-year land supply, which, again, goes back to the national planning policy framework that determines much of how planning is developed. If we do not do that, developers will pick the sites and build the things that we do not want. We will get no infrastructure and no contribution to any of the things that we all want to see. If we go forward with this, I can understand why there has to be the permission and consent of every part of Greater Manchester, but the way it is sometimes talked about does not reflect the reality that there are decisions to be made about housing.

If we want to do all the things that all of us say we want to, it comes down to working on a plan together. Even if the Government radically changed their policy on the numbers, I think they would still want the kind of approach that we are all talking about. I understand why this has been such a powerful electoral issue for everyone, but we have to reflect the reality and not promise our constituents things that we cannot deliver. We will need new houses, we will need to work together, and we will need infrastructure. That should be the basis for going forward.

Jim McMahon Portrait Jim McMahon (Oldham West and Royton) (Lab/Co-op)
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18 Mar 2020, 3:05 p.m.

It is a pleasure to serve under your chairmanship, Ms Nokes. I congratulate the hon. Member for Bury North (James Daly) on securing the debate. It might seem like a very localised matter, but it will affect 2.5 million people in Greater Manchester, and it is a huge issue for the Members of Parliament who represent them. It has been all-consuming for a few years now. I should probably declare my constituency position on this, which is that I do not support the spatial framework in its current form. The weight of responsibility for housing development is not evenly spread, either across Greater Manchester or within boroughs, and the process has led to mistrust. When I say that, I am just being honest about the weight of feedback that I get from local people.

The principle of a spatial framework is critical, and it was hard-wired into the Greater Manchester devolution deal: it was about Greater Manchester deciding for itself how it wanted to see its future. As to the idea that after being given that responsibility and power Greater Manchester should suddenly say to Government, “Actually, we don’t want to play anymore on this, because it is just too difficult,” I am afraid that that is not a mature way to do politics. We have to take responsibility for finding a way through. Ultimately, when housing development need is identified, it will affect our constituents, and we have a responsibility to ensure that the next generation will be provided for. We need to provide for the right type of housing in the right place in the future. There are no easy answers in this situation, but I think there may be an easier way to get where we want to go than the journey we have taken so far.

I have heard the politicisation of the issue, in terms of Greater Manchester having a Labour Mayor, among other things, but it does not matter what party the Mayor represents. There is a legal responsibility, passed down by central Government, to produce a spatial framework covering the whole of Greater Manchester —and, by the way, without a spatial framework the responsibility would fall on each of the 10 local authorities individually to create a new local plan, which would have a worse impact on most places, in terms of the distribution of development, and probably run a greater risk of a developers’ free-for-all if the plan was not in place at the right time. It is in our collective interest to try to find a way through.

My boss, my hon. Friend the Member for Denton and Reddish (Andrew Gwynne), should have been here today, but he is self-isolating. He has been clear from the outset about the balance between making the mature response and planning ahead, because that is the right thing to do, and giving voice to constituents. There are proposals to extend the Bredbury Park industrial estate into the Tame valley but he and local people have worked out that that could be accommodated at Ashton Moss. We have to find a different way of engaging the public, so that together we co-produce the future of Greater Manchester. We cannot have people believing that the future is being done to them or that the future of the places and communities where they live and grew up, and in which they have a stake, is being decided without them.

My first submission went to 70 pages. I have a quite geeky interest in some of the issues—and they are important. It was a call for the development of more neighbourhood plans. I would love people in my constituency to come together to co-produce the development of their area. The evidence from across the country is that when local people have the task of developing neighbourhood plans they come up with greater housing numbers than were originally proposed, because they know the infill sites that could be developed, and they know the community better. However, of course, for a geographical area as large as the one that the spatial framework covers, it is not possible to do those things within the timescale that has been announced.

I remember asking a previous notMinister in this Chamber whether the Government would give way and allow us to develop a new population evidence base. If we are not allowed to use the most up-to-date, bespoke evidence base for our population estimate, we will always provide more, because we will not believe the estimates are correct. I do not think that there is a single MP in the Chamber who believes that the current population estimates proposed by the Government are anywhere near the reality on the ground. They do not even take into account the impact of Brexit and the new immigration system, let alone other issues. There is also a general belief that even the employment land evidence base is not robust enough—and that is before getting on to the type of employment and the nature of the employment structure that we want in Greater Manchester. Time was, for a town such as Oldham, which was built on the mills, that tens of thousands of people came to work in the palaces of industry—to take a rose-tinted view of them. Now, square footage does not equal jobs. The rise of automation means that the huge factories and distribution centres that have been developed do not mean thousands of jobs. For a town such as Oldham, we want to be ambitious—realistic, yes—about the type of employment that we will get.

On infrastructure, as much as we talk about the need for schools, GP practices, hospitals, transport and all the rest, we should also talk about broadband and how the future world of work will be. What type of connectivity will people need? That is where Greater Manchester deserves great credit, because it is trying to connect the 2040 transport plan to ensure that we bring together how our conurbation will develop, in terms of planning, employment and physical development, and how people will get to work and share the area. There is no doubt that Greater Manchester cannot do that by itself.

Every Member of Parliament, regardless of which party we stand for—although I am afraid the weight falls on the Government—has to accept that if our shared belief is that “brownfield first” is a policy that we should pursue, we have to accept that a cost comes with that. It cannot be done on the cheap. It is not just about the cost of remediating a site that might be polluted; there is an issue in towns such as mine, where the end values are so low that the gap is even tighter. We need far more effort on that.

We also need a more radical plan to address the current housing stock, not just one that talks about building new stuff but ignores the substandard housing conditions that many people in Greater Manchester live in. The housing market renewal programme that was cancelled in 2010 intended to remove a lot of substandard accommodation—terraced streets in Oldham that were not fit for purpose—and replace them with decent quality family homes. When that money was taken away, nothing followed it. We have to address the poor quality that exists today and improve the standard across the board. Of course, we have to plan for the future, but that has to be done in partnership.

I genuinely hope that we will work together, not to pass the buck between Westminster and Greater Manchester, or between Conservative and Labour. The community expects us to be mature, to grow up and to work in partnership to find a solution. We need bespoke population data for Greater Manchester, in partnership with the Government and Greater Manchester, a more ambitious fund for brownfield sites in Greater Manchester, so the sites that we identify can be brought to market and developed in a reasonable timeframe, and far more ambition on the infrastructure investment that we need. I genuinely believe that if we work together, we can bring local people with us. But if local people continue to see debates such as this, where we pass the buck between different parties and from central Government to local government, I am afraid that will reflect badly on us all. Let today mark the change that our communities want, and let us begin to work together on it.

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Christopher Pincher Portrait Christopher Pincher
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18 Mar 2020, 3:18 p.m.

As I said, we believe it to be the better method. The hon. Gentleman has already pointed out that the more recent analysis has thrown up some anomalies, so we believe the 2014 figure to be the better one, but the Secretary of State has said that he will review the NPPF, so I hope that the hon. Gentleman will watch this space.

I would also like to highlight a number of Government priorities, which are reflected in our national policy, such as our protections of the green belt.

Jonathan Reynolds Portrait Jonathan Reynolds
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18 Mar 2020, 3:20 p.m.

Before the Minister moves on to Government policy and while he is still talking about the household projections, much of the argument in Greater Manchester has been based around what set of figures give us what set of outcomes. The ONS website clearly states that its household projections should not be the basis for allocating housing numbers; they are an analysis tool and, for example, do not take into account any policy objectives such as more affordable housing or higher levels of economic growth. Will he confirm that point, from a ministerial point of view? If we get to the position where we in Greater Manchester do not want a more prosperous Greater Manchester—more affordable housing—if we have a set of figures that gives us no room to improve things for our constituents, that is not satisfactory either. We have to get a clear view of that from the Minister.

Christopher Pincher Portrait Christopher Pincher
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18 Mar 2020, 3:21 p.m.

We want to ensure that we build more appropriate homes. We know that we need those houses and the right sort of houses, with the right quality. Local need needs to be determined locally. The starting point is the minimum, not the maximum figure. The Secretary of State will talk about potential changes to the NPPF in due course, so I encourage the hon. Gentleman to make his further points in his own unique and eloquent way when the time comes.

In a moment, I will speak about our priorities on the green belt—support for prioritising brownfield development and our desire to see plans in place—but my hon. Friend the Member for Bury North also mentioned flooding as an issue of concern. As he knows, in the Budget speech last week, the Chancellor announced £5.2 billion of investment in additional flood defences. That will seek to ensure that communities around the country know that future development will be safe from floods. We will assess whether existing protections in the NPPF are enough, and we will consider options for further reform in our wider ambitions for the planning system. I hope that gives my hon. Friend and other colleagues some reassurance.

My hon. Friend also mentioned housing type as an issue, with large numbers of four or five-bedroomed homes. I draw his attention and that of the Mayor and the local authorities in Greater Manchester to the NPPF, which is very clear that local authorities need to identify homes of the right size, type and tenure, as necessary for local people. That needs to be reflected in their planning priorities, which I am sure is a point that my hon. Friend the Member for Bury North will make to the Mayor and his local authority.

Leasehold and Commonhold Reform

Jonathan Reynolds Excerpts
Wednesday 2nd October 2019

(2 years ago)

Westminster Hall

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Department for Levelling Up, Housing & Communities
Esther McVey Portrait Ms McVey
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2 Oct 2019, 4:21 p.m.

Everybody here can agree that is wrong, but it is about the steps that we will have to take to get the situation under control. We are looking at help for existing leaseholders, many of whom face, as the hon. Gentleman says, onerous fees and charges, including the doubling of ground rent in some cases. The Housing, Communities and Local Government Committee and many existing leaseholders want the Government to legislate to amend those. We are deeply concerned about the difficulties that people are having with those charges, but we clearly have to look at how to unpick those contracts, which are set in law.

Jonathan Reynolds Portrait Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
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2 Oct 2019, 4:22 p.m.

I am grateful to the Minister for her generosity in giving way and to the hon. Member for Worthing West (Sir Peter Bottomley) for securing the debate.

One thing I would beg the Minister for is a simple right-to-buy formula, perhaps based on the number of years remaining—a multiple of the ground rent, in some way—that could be applied nationwide. I know there will be a lot of complexities in that, but is it something she is looking at in those plans? It would be great to hear if she were.

Esther McVey Portrait Ms McVey
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2 Oct 2019, 4:23 p.m.

We are indeed looking at a much simpler model that people can understand and make sense of, and at how to make it easier, smoother and quicker to do.

We have also made sure that there is a voluntary way for the sector to come together to solve the problems of its own creation. The industry pledge is an important first step. It has been signed by more than 60 leading developers, freeholders and managing agents. We will work with them and keep a vigilant eye on how it is working. Through that pledge, freeholders have committed to identifying any lease that doubles more frequently than every 20 years and contacting the relevant leaseholders to offer to amend their lease where necessary. I acknowledge those developers that have signed the pledge not to insert such clauses into future leases and welcome that. The pledge is an important first step, but we need to keep our eye on it. We will continue to monitor how effective it is in supporting leaseholders and we will take further action where necessary.

Leasehold Reform

Jonathan Reynolds Excerpts
Thursday 11th July 2019

(2 years, 3 months ago)

Commons Chamber

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Department for Levelling Up, Housing & Communities
Matthew Offord Portrait Dr Offord
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11 Jul 2019, 3:46 p.m.

I certainly do agree. It is such a frustrating scenario when it is not even possible to find out who is responsible. I think that the managing agents in that scenario will be particularly keen on sending their bills to my hon. Friend’s constituents and will not be very slow in forwarding those invoices.

Three years ago, residents at Kennyland Court in Hendon were asked by their managing agents to pay for roof repairs despite a 20-year guarantee being in place since 2003. The managing agents said in their defence that the guarantee was for 15 years and was on a reduced basis, but even my maths shows me that 2016, when the bills were issued, was still two years before the end of the guarantee. However, residents were just given two repair options and no real response to the matter of the guarantee. They felt that they were being bullied by the managing agents into accepting the repair bill without any answers to their legitimate questions.

A constituent at the Brinsdale Park development in Hendon is having difficulty with a managing agent over vague bills and a lack of invoices. She says that the managing agent has consistently sent coercive demands for what she believes to be incorrect service charges. She has now invoked sections 21 and 22 of the Landlord and Tenant Act 1985. Section 21 relates to service charge information and section 22 relates to a request to inspect supporting accounts. This all seems very reasonable: someone receives an invoice, invokes sections 21 and 22, and sees the information. However, the managing agent has responded by sending emails accusing my constituent of harassing him in seeking such information.

It appears, judging from this debate, that there is widespread dissatisfaction about the way that many of our constituents are being treated. Indeed, that dissatisfaction has been expressed by leaseholders themselves regarding service charges. Of 1,244 leaseholders surveyed by the Leasehold Advisory Service in 2016, 40% strongly disagreed that service charges represented value for money and 62% agreed that the services provided had not improved in the past two years.

The problems are quite simple. There is difficulty buying freeholds. There is a lack of transparency around the additional medium-term and long-term cost of a leasehold compared with buying a freehold. There are significant legal and surveying costs when leaseholders want to purchase part of the freehold, or, indeed, part of the land itself. There is an excessive increase in ground rents, a lack of transparency around service charges and freeholds not being offered to leaseholders before being sold off to a third party. This situation really is intolerable for so many people, particularly in my own constituency. I understand that the Government have sought a consultation. I hope that they act on it, because the way that residents are being treated is not only unfair but, in many ways, morally corrupt, and we must act sooner rather than later.

Jonathan Reynolds Portrait Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
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11 Jul 2019, 3:48 p.m.

I thank my hon. Friend the Member for Sheffield South East (Mr Betts) for giving us another chance to debate this issue. I have spoken before on this issue many times, and I intend to keep doing so until we have some action, because I cannot stress enough just how big a problem it is in my area.

The hon. Member for Hendon (Dr Offord) rightly pointed out the impact on London because of the high proportion of flats sold here, but the figures helpfully provided by the Library show that in 2018, 16 of the top 20 constituencies for leasehold house sales were in the north-west, and staggeringly, 14 of those were in Greater Manchester. I know how bad this is in my constituency, and my constituency is not even on that list—what must that mean for those other places? The argument that there is some sort of price differential between freehold and leasehold, when the market is so concentrated in certain parts of the country, has nothing going for it whatsoever.

In a previous debate on this issue in Westminster Hall, I said:

“I am genuinely shocked by the stories I hear in my constituency and that we have heard in this debate. I am not a man prone to hyperbole, but I would go so far as to say that the only fair description of some of the practices we have heard about in this debate is legalised extortion. There is simply no relationship between the services being rendered and the costs charged for them.”—[Official Report, 21 December 2017; Vol. 633, c. 471WH.]

I stand by every word of that statement.

The problem in my constituency is with ground rents and service charges, and we need serious action on both. For example, residents of a block of flats in the Hattersley area of my constituency were quoted £32,000 just to paint the hallways—not to paint the flats, but just the communal hallways. Frankly, they could be painted with gold, and it should not come to £32,000. Another constituent was charged £180 just to ask what it would cost to buy the freehold—just for the inquiry and the quote that came back. Frequently, worse than that, people simply do not get a response or the information when they make an inquiry about buying the freehold. Often service charge bills are received with no information and no breakdown, sometimes even charging for works that predate a managing agent taking over. Those are just a fraction of the stories I could tell. I could use more than my five-minute allocation simply reading out examples.

Like colleagues who are present, I have made many of these points before. These are always good debates. There is a great deal of expertise, good will and consensus, but frankly, I have seen everyone in this Chamber today in previous debates. This is a group of people who really know the problems, but we need some action, because we are sick of making these points.

Peter Bottomley Portrait Sir Peter Bottomley
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11 Jul 2019, 3:52 p.m.

Does the hon. Gentleman agree that the best thing to do in England or England and Wales, with, I hope, the Law Commission’s support, is to pass a simple statutory instrument that provides for a table of information, so that instead of people having to ask and argue with surveyors, they can look at the table and see the number of years, the ground rent and so on?

Jonathan Reynolds Portrait Jonathan Reynolds
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11 Jul 2019, 3:52 p.m.

I have huge respect for the work that the hon. Gentleman has done on this issue, and I could not agree more.

There are five things that I would like to see happen. First, the sale of leasehold houses should be ended—that is obvious, and I think there is no disagreement about it. Ground rents should be capped at a percentage of the property value or an overall financial sum. The sum of £250 a year has been raised, and I would be more than happy with that. As the hon. Gentleman said, there should be a simple right-to-buy formula that is not bureaucratic, with additional administration or legal costs, but that can be used in every case to let people purchase their freehold. There should definitely be a crackdown on unfair terms and opaque service charges. Ultimately, we need to make it as simple as possible to let residents take over if they are in that flat situation. Some people will not want that, and there are some reputable people in the marketplace providing services in that situation, but the power should be with the residents to make those decisions.

I will conclude, because I know how many Members want to speak. I cannot stress enough how much people want to know when they will have a simple and straightforward way out of this. I want to make a point that was touched on earlier about the impact on investors. It is true to say that there is another side to this. We have heard about the bad deal that our constituents get, and those on the investor side who have bought the leasehold and freehold rights are clearly getting a very good deal out of it. I want to make two points on that. Colleagues will be aware that when I am not speaking from the Back Benches, I speak from the Dispatch Box for the Labour party’s shadow Treasury team as the shadow City Minister.

First, institutional investors—particularly those based in this country—have some of the best research and analytical functions of any businesses going. They assess all kinds of risk, including political risk, and I cannot understand how anyone would invest substantially in this area without knowing the political risk that has been raised frequently about the will of Parliament and our desire to see change in this area. Secondly, there are many precedents of this House legislating to limit unfair contract terms and conditions because the power balance and the relationship between both parties is not right. I simply cannot emphasise enough how much that applies in this case.

This is symptomatic of how our housing market does not work anywhere near how it should. I do not think that our land allocation system works. I do not think that the design of new homes works particularly well. I do not think that the power of developers is right in our system. I do not think that the affordability of homes is anywhere near correct, and I do not think that this leasehold system is fit for purpose at all. We can influence some of those things at a local level, and in my constituency we are trying to do that, but some things require parliamentary legislative action. This is one of them, as I think we all agree, so let us get on and do it.

Marcus Jones Portrait Mr Marcus Jones (Nuneaton) (Con)
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11 Jul 2019, 3:55 p.m.

Buying a home is the biggest single commitment that anybody will take on. In this country, 85% of people want to own their own home. We encourage people to own their own home and to make it an investment. We encourage them so that, in later life, people have security and are not reliant on the state. If we are to encourage that, we need to make sure that we are giving those people every confidence in their investment and every protection we can.

I welcome the Select Committee report. I will not go into the detail of the whole report, which would be very difficult to do in the time we have this afternoon, but I want to touch on a couple of things. Commonhold features heavily in the report. This has been available since 2002 and the take-up of it has been very small. There are lots of legal practicalities and challenges for mortgage lenders and so on. But the basic fact is that developers, particularly those developing blocks of flats, want to retain some sort of value after they have completed the development and they want to be able to profit from the value they have retained. I can understand that in certain situations, such as retirement accommodation and so on, but if we are to encourage people to go to commonhold, we will have to legislate to take away from the developer the option to retain that financial interest in the property.

I would rather go for a simpler mechanism that would basically prevent developers from continuing to hold that interest in the property so that, as soon as all the flats are developed, the freehold interest reverts to the leaseholders who buy the long lease at the outset, and that can then be managed by the leaseholders. Those would be far better arrangements and, for me, that is where most people who own leasehold property fare best.

I also want to mention the conveyancing process. I say this as somebody who acted for thousands of people buying and selling residential property over a long period. Clearly, it is the job of the conveyancer—a licensed conveyancer, a registered conveyancer or a solicitor—to protect their client and they have a duty of care to their client. In the arrangements for new developments, new developers generally have two or three solicitors on a panel of solicitors that they will recommend and, by hook or by crook, they put virtually every single person who is buying to those people. The reality is that there is a lot of pressure on those firms of solicitors to exchange contracts, to complete and to expedite matters and, within that, they are therefore not necessarily providing the best impartial service for their clients. The link between these referrals and the solicitors in the advice given to clients needs to be broken. We cannot continue with the status quo in that regard.

We need to do far more about assignment fees, notice of mortgage fees and dealing with covenants. Things must be based far more on what it costs for a freeholder or managing agent to undertake a particular process, rather than adding exorbitant fees. It is absolutely disgraceful when exorbitant fees are charged, and they always come into play right at the end of a conveyancing transaction when the managing agent has the person who is selling absolutely over a barrel.

I will quickly mention dispute resolution. I welcome the announcements that have been made about the fees on leasehold tribunals, but there needs to be a far simpler process before people get to the tribunal for leaseholders. Onerous terms of leases are also a massive problem. I am aware of several constituency cases where that has caused families a major problem.

We also need to make sure that we do not have leasehold houses; there is no necessity for leasehold houses. I know there is a cost involved, but we should move to a system where very little is provided by a managing agent and a tenant. People should get value for the council tax and we should go back to more of an estate being adopted and paid for by the local authority. People can then hold their local council to account if they are not getting what they are looking for.