Housing: Park Homes

Lord Whitty Excerpts

Tuesday 23rd October 2012 Grand Committee

[Lord Whitty]

My Lords, I am very grateful to the noble Baroness, Lady Scott, for initiating this debate. She is quite right that a significant number of our fellow citizens now live in park homes on permanent sites. Some do so through lifestyle choice but, as she rightly says, the majority of them are quite elderly people who have done so at a stage in their lives when they wish to downsize. Their families have left home and this, in the face of an endemic housing problem, is their only choice. Some people of working age live in them because the cost of mortgages or rent is too high for them to live in the villages where they were born or in the towns in which they work. We have a significant population in this situation.

As the noble Baroness, Lady Scott, has said, many sites are well run by responsible site owners. We should note that right at the beginning. However, there are also far too many site owners who abuse their tenants, pay scant attention to the law and seem almost untouchable by the authorities. If the authorities do engage with the site owners, they pay little attention. As she says, the law needs substantial change. I welcome the consultation which Grant Shapps issued last year. I welcome Mr Aldous’s Private Member’s Bill and a similar Bill, which I think will appear in the Welsh Assembly this week, but we need a head of steam and the Government to get behind the action.

Before I go any further, I should declare my past and present interests. I am chair of the campaign group, Housing Voice, a vice-president of the Trading Standards Institute and a past chair of Consumer Focus. In the past few weeks, Consumer Focus and Consumer Focus Wales have produced damning reports of caravan owners’ experience on sites in England and Wales. I will refer to those in a moment. We have also had the Select Committee report in another place. The committee found that malpractice is widespread across the park home sector and the current law is inadequate. It neither deters unscrupulous park home site owners from exploiting residents nor provides local authorities with effective powers to monitor or improve site conditions. It particularly identifies sale-blocking as a significant problem.

I am calling for legislative changes, some of which are in the Private Member’s Bill before the House of Commons, to amend the Caravan Sites and Control of Development Act 1960, the Caravan Sites Act 1968 and the Mobile Homes Act 1983. It brings together the licensing regime that applies to mobile homes in England. A similar proposition is coming up in Wales. The issue of whether a site owner is a fit and proper person, however, is key to this. The Bill currently is quite weak on that proposition.

My first engagement in this area was brought about by two forces: first, my interest in energy and, secondly, the activities of my noble friend Lord Graham of Edmonton. During the passage of every energy and water Bill—we have had a good few over the past few years—he has brought up the position in relation to gas, water and electricity supply to those homes. In a mobile home park there is no standard way in which residents receive their water, electricity and gas, but the number of sites with individual metering is fairly small. Some are attached to the gas main but the vast majority are off the gas grid. In those situations, the site operator, the owner, has substantial powers in terms of selling on and resale. Significant numbers of residents have problems with their site owner, including, for example, more than a quarter of gas and electricity-supplied caravan owners in Wales.

The reports by Consumer Focus have come up with a number of suggestions in this area outwith changes in the primary legislation. It has asked the regulators, particularly Ofgem, to clarify and issue updated maximum retail price guidance to energy resellers and the rules surrounding reselling energy. It has also asked them to consider how they can help residents who are billed for their energy use by the site operator through a third-party billing company and to make sure that the standards and accuracy of those bills are guaranteed. It has also asked them to look at the level of reduction in energy costs which would be permitted under the maximum resale price rules guidance.

With Ofwat, Consumer Focus is looking for amendments to existing legislation to ensure that those who purchase their water and sewerage through site operators have equivalent rights to those who purchase direct, and, again, to clarify and update the maximum resale price. There is an agenda there for these 160,000 people, for legislation in this Parliament and on the activities of the regulators.

To pick up on a point made by the noble Baroness, Lady Scott, it is also obvious that park homes are not the most energy-efficient dwellings in the land. However, it would appear that very few of them have had any benefit from past fuel poverty or energy-efficiency schemes. In relation to the Green Deal, which is just now being launched, it is not at all clear how owners or tenants of park home sites will benefit. The previous Secretary of State, who was asked about this in 2011, said that park homes would be able to apply for the Green Deal. As matters stand, it is not at all clear that that can be the case. Access to finance is dependent on carrying out a methodology to assess the energy efficiency of the home, which is the standard assessment procedure. That is very difficult to apply—in general, it does not apply—to permanent caravan-site dwellings. The Department of Energy and Climate Change needs to look at this and see whether the potential for a Green Deal for owners of caravans could be enhanced. There is also the question of how the billing for that would operate when the site operator had an intermediary.

Outside the energy, gas and water areas, there are of course more general issues: the level of service charges, the failure of maintenance and the breach of various licensing conditions. In addition, regrettably, behaviour, as the noble Baroness, Lady Scott, has said, can amount to intimidation, threats and organised antisocial behaviour, and has inflicted great distress on a lot, albeit a minority, of these sites.

The licensing process is pretty inadequate, and the resources available to trading standards and others to enforce those licensing conditions are not at all adequate. The fit-and-proper test needs to be set in lights in this process. If we could build on the option of going down that road in the Private Member’s Bill, that would be useful, because there are people in this trade who clearly would not pass even a minimum fit-and-proper test.

The last issue that I want to raise is sale-blocking. In the course of its research, Consumer Focus Wales came across many disturbing cases of people wanting to sell and move away being faced with hostility, threats and what I might call physical and financial sabotage on the part of the site owners. Consumer Focus has come up with a number of such cases.

At the moment, the site owner has a veto over the ability to resell. In one such case, for example, the mobile home residents sold their home to an unscrupulous site operator for a fraction of its market value. In another, the home owner told how she had received just £2,000, despite the fact that the home had been valued at £110,000. In another case, a couple bought their home directly from the site owner for £150,000 but, when they tried to sell it, the site owner blocked the sale of the home to any other purchaser until eventually the couple agreed to sell it back to him for just £50,000, of which, in reality, they received only £35,000. That is gross deception and dishonesty but it arises from the anomalous power position between the owners and tenants of the homes and the site owners. In that case, having paid £35,000 for the home, the site owner subsequently sold it for £95,000.

So far, there have been no criminal proceedings of any sort against such people, and that is unacceptable in our society for a significant number of our citizens. We should start by following through with the Private Member’s Bill and the repeal of the relevant provisions on sale-blocking and the veto of the site operator.

I hope that the Private Member’s Bill succeeds but, even more, I hope that the Government take up this case and look at it across the board, perhaps strengthening the Private Member’s Bill or coming up with their own propositions which will ensure that the legislation, the regulations and the enforcement resources are available to end the distressing effects of the present situation.