Leasehold Reform: Forfeiture Provisions

Lord Kennedy of Southwark Excerpts

Monday 20th June 2022 Lords Chamber

Asked by

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what plans they have to reform the forfeiture provisions of leasehold housing.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare an interest as a leaseholder.

[The Minister of State, Home Office and Department for Levelling Up, Housing & Communities (Lord Greenhalgh) (Con)]

My Lords, I declare my residential and commercial property interests as set out in the register. The Government believe that forfeiture is an extreme measure which should be used only as a last resort. In practice, forfeiture happens very rarely, and the leaseholder may apply for relief from forfeiture subject to the court’s discretion. We asked the Law Commission to update its 2006 review of forfeiture law, Termination of Tenancies for Tenant Default, to account for wider leasehold reforms currently under way, and we are considering what action may be needed.

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[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, there is a desperate need for root and branch leasehold reform. Does the Minister agree that the execution of forfeiture, or even the threat of forfeiture of a lease on a home, to recover a debt or deal with a dispute is totally disproportionate in comparison with the value of the asset, and that what should be in place is a simple procedure to recover the debt or deal with the issue at hand commensurate with the issue or the value of the debt concerned?

[Lord Greenhalgh (Con)]

My Lords, I agree with the noble Lord that forfeiture is an extreme measure. We have asked the Law Commission to look into this and it has come back not with removing forfeiture but with simplifying the process, making it more transparent and coming up with a mechanism that is more proportionate. We are considering these as part of the second stage of our leasehold reform.

--- Later in debate ---

[Lord Greenhalgh (Con)]

My Lords, I thank my noble friend for raising that. I am conscious of that way of starting the process; when you get the Bill written, pre-legislative scrutiny is a good way of getting broad support. In fact, that is how we started the process of scrutiny for what is now the Building Safety Act.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, as we are not going to have the Bill in this Session of Parliament, which is very disappointing, would the Minister welcome seeing a number a campaigners to discuss the reform with him, so as to get ready for the Bill period in the last Session of this Parliament?