Building Safety and Resilience

Lauren Sullivan Excerpts

Wednesday 11th September 2024 Commons Chamber

[Clive Efford (Eltham and Chislehurst) (Lab)]

I commend all the maiden speeches that we have heard today: I feel as if I have been on a tour of England following the descriptions of so many constituencies. May I associate myself with what was said by the hon. Member for Bromley and Biggin Hill (Peter Fortune) about his predecessor, Bob Neill? I now represent part of Bob Neill’s former constituency, and I know from talking to people during the recent general election campaign that he was held in high regard by his constituents. I wish him all the best for the future.

I am sick and tired of coming here and raising the issue of Master Gunner Place in my constituency. It has been in need of remedial work for a very long time, and still nothing has been done. It was built by Countryside Properties, now Vistry Group Ltd, and we understand that it is about to be handed over to a company called Samnas, although that is yet to happen I have written many times to the managing agent, Rendall and Rittner, about issues that have been raised with me by my constituents, but to no avail.

I was approached by one of my constituents who lives in Master Gunner Place. He had tried to sell his property on four occasions; at the final attempt he had one bidder, whose bid he accepted. However, the bidder was refused a mortgage owing to the size of the service charge. The charge for 2022-23 rose by 107% in 2023-24, to £6,100, and such charges are now trapping people in homes they are unable to sell. Under section 22 of the Landlord and Tenant Act 1985, the leaseholders are entitled to demand from the freeholder or the managing agent an explanation of how those charges were arrived at. When the residents of Master Gunner Place asked for that, they were given only partial information, and on several occasions the managing agent failed to meet the requirement to respond within 30 days. In the end, the agent flatly refused to supply the missing information. When my constituent complained to the managing agent, it did not answer; it just got its solicitors to respond and threaten him with a county court judgment. As a result of that, my constituent had no option: because of the terms of the lease, he had to pay up; otherwise, he could have been in default. He ended up paying the service charge, plus nearly £1,250 in legal fees and interest for being two months late with his payment.

The residents tried to mount legal action but, ironically, they feared that if they were to take on the freeholder over the costs, they would risk the freeholder adding the cost of defending the action to their service charges, because of the terms of the lease. They are absolutely trapped in a situation whereby they need the information to be able to legally challenge the freeholder, but the freeholder and the managing agent are withholding the information that is needed to undertake the action. That cannot be a fair situation for the residents to be left in.

[Dr Lauren Sullivan (Gravesham) (Lab)]

Does my hon. Friend agree that it is also about insurance? I have a constituent in a similar situation who has had to pay £2,500 in insurance costs.

[Clive Efford]

Yes, insurance costs are driving up service charges. I have heard of 60% increases in service charges that are attributable to insurance costs. Insurance companies are gouging prices and making money on the back of this situation. Given what has brought us to this debate, it is absolutely appalling that they are behaving in that way.

Remedial works are ultimately the responsibility of freeholders, and contributions from leaseholders should be capped. Management companies are obliged to provide the detail of what they intend to spend on such work but, unfortunately, they are withholding that information. The managing agent should not be able to charge residents anything until the information is supplied. The cap should be spread over 10 years, and no more than one tenth of the cost should be charged in any one year. In the absence of the relevant information, leaseholders cannot check whether the charges that are being imposed on them are reasonable. If they do not pay them and they challenge them, they risk being in default of their leases and receiving a letter from solicitors. The reality is that the terms of leases prevent people from being able to get justice.

The outstanding safety work in the block in Master Gunner Place is simply not being done. A survey was done at the end of 2019, and it was clear that the work needed to be done. In the intervening years, none of it has been carried out. The developer, Vistry Group, is supposedly in the process of handing over the freehold to Samnas, but because the legal documents have not been signed, the leaseholders have been left in limbo and are unable to progress any of the work. The leaseholders engaged lawyers to write to the developer in order to get a reply on the scope of the work that needed to be carried out, and they were informed that the work was due to start in August 2024. Here we are in September, and nothing has been done. They still have no idea about what work is in scope or what contribution the residents will have to make. There are three blocks involved in the development and, to date, none of them has had any of the remedial work done.

It is now time to draw a line under all this. It has gone on for too long. We know that the work needs to be done, we know who is responsible for it and we should not be allowing them to drag their feet any more. It is time for the remediation acceleration scheme to put a rocket under those developers and freeholders. We should be ensuring that they carry out this work, and that if they refuse to do so, they are fined. Only fines will make these people see reason; it is only if they are hit financially that they will change their ways. The remediation acceleration scheme must also include compensation for leaseholders for all the unreasonable charges they have been forced to pay because the management companies and the freeholders have withheld the information needed to ensure accurate fees and charges and that the cap is being properly applied. Where those companies have not done that, we should be making sure that they are fined.