New Homes Commitment

Lord Young of Cookham Excerpts

Tuesday 21st June 2022 Lords Chamber

Asked by

[Lord Young of Cookham]

To ask Her Majesty’s Government whether they remain committed to building 300,000 new homes a year.

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

Delivering new homes and regenerating left-behind communities are central to our levelling-up mission and we remain committed to our ambition of delivering 300,000 homes a year. We have made progress, with more than 2 million additional homes being delivered since April 2010. Over 242,000 homes were delivered from April 2019 to March 2020, which is the highest level for over 30 years.

[Lord Young of Cookham (Con)]

I am grateful to my noble friend. The Construction Industry Training Board has forecast that we will need an additional 266,000 construction workers over the next three years if demand is to be met—and that is in an industry already facing shortages. What action can my noble friend take to see that those numbers are met? If there is to be a shortfall in output, can he ensure that that does not fall on the affordable sector of the market?

[Lord Greenhalgh (Con)]

My noble friend is right that there has been a recent report by the CITB, but I point out that that shortfall is for the whole of the construction industry, not just housing. We have significant cross-government intervention and investment in skills, and the CITB made £110 million available in training grants to support 14,000 businesses. However, we continue to recognise—this was picked up by the Federation of Master Builders—that there are stresses and strains in terms of labour and materials. The Government are working hard to overcome these.

Leasehold Reform: Forfeiture Provisions

Lord Young of Cookham Excerpts

Monday 20th June 2022 Lords Chamber

[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.

[Lord Young of Cookham (Con)]

My Lords, does my noble friend recall saying on 9 June last year that it was the Government’s aim to complete the leasehold reform programme in this third Session of Parliament? Is that still the case, because the Bill was not in the Queen’s Speech? If it is not, can we at least have a draft Bill in this Session so that we can hit the ground running in the fourth?

[Lord Greenhalgh (Con)]

I always thank my noble friend for his interventions. We want to move forward with the second stage of leasehold reform. It will not be part of the third Session but there is a commitment to this Parliament. My noble friend is right that we can use this time to get a Bill drafted. We will take time so that we can get it through Parliament as soon as possible at the beginning of the fourth Session.

High-rise Buildings: Evacuation of Disabled Residents

Lord Young of Cookham Excerpts

Wednesday 25th May 2022 Lords Chamber

[Lord Greenhalgh (Con)]

There are real concerns based on the previous consultation around practicality—the measures that get mobility-impaired residents out in advance of fire and rescue services, which on average respond in six to seven minutes—proportionality in a residential setting, where there are rarely 24-hour staff to carry out evacuations, and safety around evacuation of all residents that does not hinder the fire and rescue services fighting the fire. Those are the concerns we have outlined in the current consultation.

[Lord Young of Cookham (Con)]

Does my noble friend agree that the need to evacuate disabled residents from high-rise flats would be greatly reduced if the remediation measures to reduce fire risks took place? Following the passage of the Building Safety Act, can my noble friend now say what progress is being made in eliminating those risks from high-rise buildings?

[Lord Greenhalgh (Con)]

My noble friend is right that the concern is ultimately for those buildings where simultaneous evacuation is in place. We are making progress in ACM buildings and high-rises with other forms of flammable cladding. Most importantly, we now have a situation where we are getting the polluters to pay and the funding in place to get remediation done as quickly as is practical.

Building Safety Bill

Lord Young of Cookham Excerpts

Consideration of Commons amendments
Tuesday 26th April 2022 Lords Chamber

[Lord Young of Cookham (Con)]

My Lords, I commend my noble friend again for the way he has managed this Bill through your Lordships’ House; like him, I very much hope the end is in sight. It has been particularly challenging, as he has had to retrofit into the Bill the remediation clauses, while negotiating at the same time with the industry and the Treasury.

On those negotiations, since we last debated the Bill, Ministers have persuaded the last remaining housebuilder—Galliard—to join the pledge to remediate defects in their own buildings, and I very much welcome that. I have one issue to raise on the builders’ pledge, which is restricted to “life-critical fire-safety” work. Can my noble friend confirm that this definition, which appears to be narrower than the one in the Bill, will cover all the necessary work to make a building safe? It would clearly be unsatisfactory if a builder were to argue that some particular aspect of remediation was not life critical, and he therefore did not do it, with the result that the building did not qualify for the relevant certificate and the leaseholder could not sell the building.

On Motion D, I understand why the Government resisted the Lords’ amendment which sought to give enfranchised leaseholders the same rights as unenfranchised leaseholders. My noble friend has just explained the perverse incentive that that would have resulted in. However, inserting that section back into the Bill leaves the enfranchised leaseholders in the firing line for the time being. I will not repeat all of my noble friend’s “read my lips” speech, which we have heard on several occasions, but the last sentence was:

“They are effectively leaseholders that have enfranchised as opposed to freeholders. I hope that helps.”—[Official Report, 28/2/22; col. GC 262.]


The Minister has responded to the amendment that I tabled with my noble friend by announcing a consultation, and I very much welcome that. Perhaps he could say something about the timetable for that consultation—when it will begin, when it will end, and when the conclusions will be announced—because time is fairly critical for some of these leaseholders. I hope he can repeat the commitment that the objective is to put enfranchised leaseholders in the same position as unenfranchised leaseholders—namely, with caps on their contributions, which they do not have in the Bill at the moment. Unless that firm protection is offered, it will undermine all the efforts made by successive Governments and by my noble friend to encourage leaseholders to enfranchise.

I would like to say a word about orphaned buildings. Will the Minister say how he envisages these buildings being remediated if there is no guilty party or freeholder to pursue? We cannot leave those tenants and leaseholders in unsafe buildings that they are unable to sell, and it would be reassuring for them if they knew the Government had a plan to deal with that.

Finally, on Motion H, there are two issues. I am sure that the Minister is right when he says that there are few buildings under 11 metres with serious problems, but the fire at Richmond House burned the building to the ground in less than 11 minutes in September 2019, and it was under 11 metres. Therefore, I very much hope that the case-by-case analysis that the Minister referred to will quickly reveal which buildings are at risk. Following that, can he confirm that they will be remediated without the leaseholders bearing all the costs, which is currently the position under the Bill?

When we debated this on Report, my noble friend Lord Blencathra and I tabled an amendment which effectively halved the cap on leaseholder contributions. However, we were persuaded by the eloquent arguments adduced by the noble and learned Lord, Lord Hope, and the noble Lord, Lord Marks, that zero was possible under ECHR and we then supported that amendment, which was carried by the House. The Government have made it quite clear that zero is unacceptable, so I see no point in pursuing that at this stage of the Parliament. However, I remain of the view that our original amendment is actually the right way forward, so, while not supporting the amendment of the noble Baroness, Lady Hayman, which is quite close to zero, I will not vote against it. I hope that if it is carried, the Government will retable my and my noble friend Lord Blencathra’s amendment in the other place, and bring this matter to a satisfactory conclusion.

Building Safety Bill

Lord Young of Cookham Excerpts

3rd reading
Monday 4th April 2022 Lords Chamber

[Lord Young of Cookham (Con)]

I thank my noble friend for his very kind words, and, in return, I commend him for the progress which he has made with the Bill, with his statement on 10 January, the amendments he tabled on 14 February and the further amendments he tabled last week on Report. I also commend him for his engagement with those who have sought to improve the Bill; he engaged with patience and humour despite, from time to time, considerable provocation from two former Chief Whips.

I will make two very brief points. First, I hope the amendments that were carried last week will not be overturned in the other place: amendments protecting those in buildings under 11 metres; amendments protecting leaseholders from making any contribution; and amendments that seek to protect the position of enfranchised leaseholders and put them on a par with unenfranchised leaseholders.

Secondly, there is still some unfinished business. We need to make progress on so-called orphaned buildings. I know my noble friend recognises the problem, which he believes, I think, can be dealt with administratively, and in an exchange on Report he pointed to the funds available, but it remains to be seen whether those funds will be sufficient and who will take on the responsibility of remediating these buildings given that the leaseholders —at the bottom of the waterfall—will not have the resources to do this, particularly if they are expected to litigate first.

I hope that, in the other place, some thought might be given to this and, in what is entirely a matter for the other place, I hope they recognise that they have never seen these clauses at all and therefore allow adequate time for consideration of Lords amendments.

[The Earl of Lytton (CB)]

My Lords, your Lordships will of course know that I have one principal abiding fear about this Bill, which is exactly the point that has been made by the noble Lord, Lord Young—who I regard, along with the noble Lord, Lord Blencathra, as my co-conspirator on this Bill.

To put a little more flesh on that bone, in a case where the original developer or builder cannot be identified or is identified but has gone bust, the question is about getting the remediation cost from these defunct individuals. Given that we have effectively removed the liability of leaseholders for remediation costs—and rightly so, in my view—what then happens when those freeholders and leaseholders are faced with no other option going forward? That is my abiding fear about the overwhelming financial odds that might face these occupiers.

Whether is it possible for the Minister to clarify that, I do not know. However, I add my voice to those of others who have expressed their appreciation for what the Minister has done: he has tackled this with a real sense of purpose, with an open-door policy to talking with those who have concerns, and I appreciate that very much. Behind him is the Bill team, to which I pay tribute as well.

I pay tribute to my co-conspirators, and also all those across the House, on all sides, who have supported me in Divisions—I appreciate that very much indeed. I particularly pay tribute to fellow Cross-Bench Peers, the noble Baronesses, Lady Finlay and Lady Grey-Thompson, and the noble Lord, Lord Best, who, on individual aspects, have campaigned tremendously effectively to have this Bill altered, very much for the better.

Beyond this House, I pay tribute to the efforts of organisations such as the Leasehold Knowledge Partnership, which has been very helpful in many respects. Most of all, I thank the perpetrator pays team, Steve Day and Daniel Greenberg; as far as I am concerned, their input has been absolutely fantastic and totally indispensable.

My last point has to be for all those who wrote to me: the couples who had put off having a family, or even getting married; the distraught pensioners; the families with their hopes and finances on hold, whose children have had their education disrupted and who have been unable to move because their properties were unsaleable for work or for any other purpose; and those facing bankruptcy and repossession. They have been my driving force. In all my years of experience as a chartered surveyor, I do not think I have had so many people write to me, and I hope that I have been able to give a voice to the voiceless in that respect and some glimmer of hope that, at the end of a really long dark period for them, there might be a little bit of light. I remain committed to the principles that I have held to throughout the course of the Bill.

Housebuilding: Target

Lord Young of Cookham Excerpts

Wednesday 30th March 2022 Lords Chamber

Asked by

[Lord Young of Cookham]

To ask Her Majesty’s Government what progress they have made towards meeting their target of building 300,000 homes a year.

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

From April 2019 to March 2020, more than 242,000 homes were delivered—the highest level for over 30 years. Despite the pandemic, we enabled construction sites to stay open, allowing us to deliver more than 216,000 homes in England in 2020-21, well above the 186,500 forecast for the whole of the UK.

[Lord Young of Cookham (Con)]

I am grateful to my noble friend, but is he aware that the House of Lords Built Environment Committee has warned the Government that they will miss their targets by about half over the period of time in question? In order to catch up, will my noble friend consider greatly accelerating the number of homes built off-site, using modular construction? These are quicker, built to a higher quality and less susceptible to the weather than traditional methods. Within that, will he consider more homes for the elderly, which are in short supply, so that those who want to can downsize, freeing up their homes for families?

[Lord Greenhalgh (Con)]

My noble friend has extensive experience of housing. The department recognises the importance of modern methods of construction, both volumetric and non-volumetric as well as those designed for manufacture and assembly, and we have a target within the affordable homes programme of delivering around 25% through these methods. Obviously, we recognise the need for housing of all types and tenures, and both supported and private housing for the elderly, and retirement communities are a very important part of getting the built environment right.

Building Safety Bill

Lord Young of Cookham Excerpts

Lords Hansard - Part 1 & Report stage
Tuesday 29th March 2022 Lords Chamber

[Baroness Finlay of Llandaff (CB)]

My Lords, I rise briefly to support the amendment in the name of the noble Lord, Lord Crisp, and others. I had the privilege to be on the Select Committee on National Policy for the Built Environment, which reported six years ago with Building Better Places. We had extensive evidence from Public Health England on the impacts of the built environment on health. That built on the work done by Michael Marmot on the social determinants of health and the evidence of the cost to the nation of poor housing. In our report, we recommended that those working in housing should take account of the health impacts of their decisions. The relevant paragraph of the government response to our report said:

“The Government recognises the importance of considering health as part of the planning process and believes health impacts should be considered as part of the wider policy environment.”


The plea that we heard from the noble Lords, Lord Crisp and Lord Bethell, to integrate these factors and consider them at every stage has been supported by the evidence for many years. I hope that the Government will listen to the evidence that they themselves took on board in responding to our report.

[Lord Young of Cookham (Con)]

My Lords, I added my name to the amendment tabled by the noble Lord, Lord Crisp, in Committee but was unable to speak to it, so I welcome the opportunity to add a brief footnote to the excellent speech that he made a few moments ago. I do so having been responsible for building control under the Thatcher and Major Administrations.

No one could object to the aspirations behind the amendment and the Healthy Homes Act campaign and I hope that the Minister will be able to respond sympathetically. I understand that so far the Government have objected to the proposal on the grounds that this is a matter for planning rather than for building regulations. The boundary between the two is inevitably not clearly marked and many people think that, if they have planning consent, that is the end of their interface with the local authority.

I have just one suggestion to make. The Minister may take the view that some of the objectives in the TCPA brief fall on the planning side rather than the building regulations side. I quote from its manifesto, which says that homes should

“be built to design out crime and be secure … all new homes should … provide access to sustainable transport and walkable services, including green infrastructure and play space”

and should have a minimum liveable space. Those all seem to be entirely reasonable requests. If my noble friend takes that view and believes that they are not appropriate to this Bill, can he give an assurance that they will be incorporated into the next planning Bill so that we can get to the same destination, albeit via a different route?

[Baroness Prashar (CB)]

My Lords, I, too, support the amendment in the name of the noble Lord, Lord Crisp. In so doing, I declare that I am a trustee of the Nationwide Foundation, which supports the TCPA’s Healthy Homes Act campaign. I shall not detain the House for too long other than to reiterate the points made by the noble Lord, Lord Crisp, who introduced the amendment admirably. This is a simple but profound amendment that should be taken note of. As we have heard, we already have a great deal of evidence about the impact of housing on both health and education—Covid highlighted all of that—and how that contributes to inequalities in health. For all those reasons, it is important that we take note of the amendment and make sure that it is incorporated, whether into this Bill or a planning Bill, as the noble Lord, Lord Young, said. One cannot fault the logic of what has been recommended, so I strongly support the amendment and look forward to the Minister’s response. I also urge him to agree to meet some of us to see how this issue can be taken forward.

--- Later in debate ---

[Lord Blencathra (Con)]

I rise to comment on the disabled amendments that the Government have laid, including the one that was just moved. I will also comment briefly on Amendments 46 and 47, which have not yet been spoken to by the noble Baroness, Lady Fox of Buckley, and speak to Amendments 39 and 40 on behalf of the right reverend Prelate the Bishop of St Albans, since he is unable to be with us at this time of the morning.

I commend the Government for listening to my noble friend Lady Grey-Thompson in Committee and on all the amendments that they have brought forward today. Having been bored on the train when I was heading up north last week, I counted on the Order Paper more than 220 government amendments and 50 proposed new clauses. That is an extraordinary achievement and shows the extent to which my noble friend the Minister has been listening, as well as what he has been able to drive forward—principally because the Secretary of State, my right honourable friend Michael Gove, gets it and understands what needs to be done. So, although my noble friends and I may move a few amendments today, and perhaps force them to a vote, I do not want the Minister to think that we are being churlish. We appreciate the huge distance that the Government have travelled; we just think that there may be one or two more gaps that we need to fill.

I would be grateful if the Minister could reassure me as to why the disabled amendments that we have just heard noble Lords speak to may not be necessary or why there may still be an essential gap there. I thought that the government amendments were adequate but I am keen to hear his explanation.

I will speak briefly to Amendments 46 and 47 in the name of the noble Baroness, Lady Fox. In Committee, I tried to make the point that the burdens on leaseholders are much heavier than those on building safety managers and others, who seem to have unlimited rights to impose fines and penalties and invade homes to check on things without good reason. I am keen to hear what the noble Baroness has to say about her amendments, which state that such persons should be able to access leasehold flats only when it is essential to do so.

My main purpose this morning is to speak to Amendments 39 and 40 in the name of the right reverend Prelate the Bishop of St Albans, which I was pleased to sign up to as second fiddle. The good news is that I shall not need to make my own speech and bore the House. The bad news is that my speaking on behalf of a right reverend Prelate may do irreparable damage to the Church of England, so I hope that does not occur. He says:

“First off, I would like to express gratitude to the Minister for tabling his Amendment 38 and the overall listening approach he has taken to the concerns of the House throughout the passage of this Bill. I hope that this is at least some indication on the Government’s part that they are still working through the imperfections of this Bill, and that they might respond with amendments at Third Reading in response to problems noble Lords and Baronesses”


have raised and will raise today. He continues:

“I will be frank and say that although I am pleased the Government did respond to the concerns I raised at Committee stage by tabling Amendment 38, the content of it is admittedly limited. The reality is that the principal accountable person could take representations from or hold consultations with the relevant tenants or leaseholders on matters”


relating to building safety

“without necessarily integrating their concerns into the Residents Engagement Strategy. It appears entirely discretionary on the accountable person as to what enters into this strategy. In fact, because Amendment 38 also requires the accountable person to act in accordance with the strategy”

that, from conversations he has had with others,

“would seem to imply that a failure to act in accordance with the strategy could be flagged up to the Building Safety Regulator. The question then is simple: why would an accountable person commit to include something in an engagement strategy that could later be used against them?”

However, the right reverend Prelate says:

“I do not want to hastily dismiss what the Government are trying to do here as the foundations contained”


within the amendment require only

“an ever so slight tweaking to better ensure that the accountable person acts in accordance with a strategy that actually reflects the views of residents, rather than the current vague requirement to just ‘take any representations … on the consultation into account when next reviewing the strategy’”.

Personally, I think that he has made a very good point there. He continues:

“Amendment 39 would mildly alter Amendment 38 to ensure that the accountable person takes any representations made on the consultation into account”


and then changes

“‘the strategy to reflect the balance of representations made’. This remains imperfect but it does at least in part remove the discretionary basis for deciding the content of the strategy by adding a protection to ensure that the strategy reflects”

that balance. He then says:

“Even with this change, the accountable person will hold immense discretionary power since it is … incumbent on them to interpret the balance of representations made”


so that the accountable person still has the whip hand.

“However, it would alter the relationship when formulating the strategy from the accountable person as its absolute sovereign to the accountable person as the interpreter of the general will. The accountable person will ultimately be the individual who determines the content that enters into the residents engagement strategy. Amendment 39 provides just an inch of breathing room to better guarantee that it does reflect the views of tenants and residents”.


Amendment 40, says the right reverend Prelate,

“admittedly is far more wide ranging and acts as a direct extension”

of his previous amendment in Committee,

“which would have mandated recognised residents associations for the purpose of consultations on building safety issues. I did recognise the Government’s discomfort at the prospect of mandating anything, particularly where there exists an amicable relationship between the freeholder and the leaseholders or tenants. For this reason, I have tried to create a conditional avenue by which a freeholder must set up a residents association. The condition being that as part of consultations on the residents engagement strategy, the accountable person must consult with residents on whether to create a recognised tenants association, and create one, for the purpose of consultations on building safety decisions, where it turns out there is a simple majority demand from residents”

to so have one. He continues:

“I believe a conditional requirement for recognised residents’ associations would help mitigate some of the abuses that do exist within the system. In Committee, I referenced the case of a freeholder who charged residents a 100% markup on window repairs and also spent £74,000 in a court battle to prevent residents from forming a recognised tenants’ association. I cannot speculate on how many other leaseholders have suffered similar abuses at the hands of their freeholder. However, I know the Minister is as appalled by these abuses as I am.”


I share that point of view. He continues:

“The Government do recognise the need to reform the leasehold system”—


something we all look forward to in, we hope, the next Queen’s Speech on 10 May.

“For this reason, I do not want to press the Government on Amendment 40 other than to ask the Minister to look seriously at how recognised tenants’ associations can be more widely promoted and more easily set up, as well as perhaps to expand their remit to encompass matters relating to building safety issues so that there is actual accountability and scrutiny when it comes to the charges they incur.


However, I would still impress to the Government the need to strengthen Amendment 38 so that there are greater safeguards to guarantee that residents’ engagement strategies better reflect the views of residents. I believe Amendment 39 presents a sensible compromise to solve this problem. The authority to decide on what is contained within the residents’ engagement strategy remains with the accountable person but in a manner that is more conducive to capturing the balance of residents’ views.


Finally, I would just like to note a few other amendments in this group. I welcome the sentiment of Amendment 36 within this group and the duty it places on the accountable person to achieve best value. I welcome the Government’s decision to remove the building safety manager”—


I think we all welcome that—

“and I would congratulate the noble Baroness, Lady Fox, on making the strong case for its removal in Committee. Of course, some of the costs previously contained within the building safety manager will naturally be rebadged and passed on, it is inevitable. Nevertheless, since it is now discretionary on the accountable person to decide how to meet their obligations under this Act, and since any costs incurred for meeting this obligation will be met by the tenants or leaseholders, there is no incentive for the accountable person not to reimpose the costly building safety manager. Therefore, I do believe that some duty to achieve best value would represent a sort of financial safeguard for leaseholders and possibly encourage freeholders to take a more considered approach to meeting their obligations rather than taking the path of least resistance in hiring a building safety manager.

I would also quickly offer my support to Amendments 13, 20, and 35, and the protections they afford to those living with disabilities, which I welcome.”


It has been a privilege to deliver this speech on behalf of the right reverend Prelate. I say to my noble friend that this was not Blencathra talking; I was speaking from a much higher authority today and expect him to pay particular attention to Amendment 39.

[Lord Young of Cookham (Con)]

My Lords, I will intervene very briefly to welcome the Government’s amendments, particularly Amendment 100, which removes Schedule 8 and abolishes the building safety charges as separate charges. As my noble friend the Minister mentioned in his opening remarks, I spoke to an amendment in Committee which did exactly that, pointing out the extra costs and potential confusion that two separate charges could result in. I recommended that the building safety charge be incorporated into the service charge but shown separately. I welcome this simplification, as will leaseholders. I am grateful to my noble friend for listening and responding.

I will very briefly support Amendments 39 and 40 in the name of the right reverend Prelate the Bishop of St Albans, and so ably spoken to by my noble friend Lord Blencathra, who may find himself invited to deputise at pulpits in and around St Albans as a result of his performance. If there is no provision in the Bill to ensure that residents have a collective voice, the accountable person—normally the landlord—will have a huge interest in ensuring that residents are not organised and enabled to resist any costs that the landlord wishes to impose on them. The current government proposal just says that the accountable person should design an engagement strategy, whereas the amendments rightly go further, requiring a tenants’ association to be set up where that is what the majority want.

The amendment goes entirely with the grain of successive Governments’ policy to even up the terms of trade between leaseholders and tenants on the one hand and landlords on the other. I hope that the Minister can look benevolently on these proposals and perhaps at a later stage consider strengthening them further in the direction proposed by my noble friend.

Building Safety Bill

Lord Young of Cookham Excerpts

Lords Hansard - Part 2 & Report stage
Tuesday 29th March 2022 Lords Chamber

I ask your Lordships to support this significant and important set of amendments to ensure that the polluter pays.

[Lord Young of Cookham (Con)]

My Lords, I welcome the amendments tabled by the Government. As my noble friend has explained, they extend the scope of liability, making it more likely that builders will be remediated. The amendments also block some loopholes, and I welcome that.

I begin with a general point about amending this part of the Bill. I understand the caution that many in your Lordships’ House have about amending a Bill at this stage of a Parliament if it has been fully scrutinised by the Commons. However, there should be no such inhibitions about amending this part of the Bill, because although the Bill started in another place, the remediation clauses were added in your Lordships’ House, and the other place has never considered them. So, as part of our role we should feel free to amend the Bill if we feel that that is the right thing to do, not least because the Government have themselves tabled several hundred amendments.

I make it clear that I welcome the amendments on remediation, and I commend my noble friend and Michael Gove on the substantial progress that they have made in beginning to address the crisis facing thousands of leaseholders trapped in unsaleable flats, facing unaffordable remediation bills and repossession as well as, in many cases, high insurance premiums and the costs of waking watches, while continuing to live in a building which is a fire risk.

My noble friend has moved the dial, and is to be commended for that, but, as today’s debate will show, the Bill as it stands falls well short of assurances that Ministers have given to leaseholders, who are the only innocent party in a scandal that has involved developers, contractors, local authorities and, indeed, as is emerging from the Grenfell inquiry, the Government, who knew about the cladding problems 15 years before Grenfell—and did nothing.

In this section of the Bill we are building on the Government’s proposals and we do so after extensive discussions with Ministers and officials, for which we are really grateful. We hope that it may still be possible, even at this late stage, to find common ground.

In particular, we seek to amend the Bill to be consistent with commitments that Ministers have made on the record. I remind my noble friend the Minister of what he told noble Lords in his letter dated 20 January, entitled “Introduction of the Building Safety Bill”. He said:

“The Secretary of State recently announced that leaseholders living in their homes should be protected from the costs of remediating historic building safety defects.”


That letter built on the Statement made by the Secretary of State, Michael Gove, on 10 January in another place. He said:

“First, we will make sure that we provide leaseholders with statutory protection … and we will work with colleagues across the House to ensure that that statutory protection extends to all the work”—


all the work—

“required to make buildings safe.”

The Statement said:

“We will take action to end the scandal and protect leaseholders.”


It continued:

“We will make industry pay to fix all of the remaining problems and help to cover the range of costs facing leaseholders.”—[Official Report, Commons, 10/1/22; cols. 285-291.]


I think we would all agree with that.

However, since then these commitments have been watered down. Not all leaseholders are covered by the Bill, not all buildings are covered by the Bill, and defects have been sub-divided into those that are fully protected by qualifying leaseholders, and other defects that are not. I see no guiding principle behind these distinctions, but the consequence is protecting the contractor/taxpayer and putting more costs on to the only innocent party: the leaseholder.

Turning to Amendment 233, in my name and that of my noble friend Lord Blencathra, I appreciate that there are other proposals that have the same objective as ours, namely Amendments 221 and 234. I am in no way prescriptive about how the problem is tackled. The best way forward may be for my noble friend the Minister to say that he recognises the problem and will come up with the same solution at a later stage, so let me describe the problem.

The Government’s so-called waterfall proposal creates a pyramid of contributions, with developers at the top and leaseholders at the bottom. This is a welcome inversion of the situation under the current law, where the leaseholders are in the firing line, and the Government should be commended for it, but the waterfall does not live up to Michael Gove’s Statement, in which he said that

“leaseholders are shouldering a desperately unfair burden. They are blameless, and it is morally wrong that they should be the ones asked to pay the price. I am clear about who should pay the price for remedying failures. It should be the industries that profited, as they caused the problem, and those who have continued to profit, as they make it worse.”—[Official Report, Commons, 10/1/22; cols. 283-84.]

We have been told at meetings with officials and Ministers that good progress has been made in persuading the industry to accept its responsibility and remediate the buildings for which it is responsible, doubtless incentivised by some of the provisions in the Bill. I commend Ministers for the progress they have made. However, we are left with the issue of what happens to buildings where remediation does not happen—the so-called orphaned buildings. The freeholder has no resources, there is no developer or contractor to sue, and so we reach the end of the waterfall: the leaseholders. What are they supposed to do? Are they supposed to pay for all the non-cladding costs, which they cannot afford? In many cases these are higher than the cladding costs. Should they continue to live in a dangerous building, with properties that they cannot sell and with high insurance premiums?

Let me illustrate this with an example, Northpoint in Bromley. The developer, Taylor Wimpey, a company listed on the FTSE 100, refuses to pay, I am told. The building is already in the building safety fund for cladding, so taxpayers are picking up the bill. Under the waterfall, we come to the resident management company, which is run by the leaseholders. It collects the service charge and therefore has a liability in step 2 of the Government’s waterfall, but it has no assets and does not have an interest worth £2 million, so we reach the end of the waterfall: the leaseholders. Most flats in Northpoint are worth less than £325,000, so there will be zero commitment to be collected from most leaseholders for non-cladding costs, thanks to the Government’s low-value exemption. A handful of the flats in that building are worth more than £325,000, so those few leaseholders are in the invidious position of having to pay £15,000—but they do not have to pay, because waking watches have eaten up their £15,000 caps already, so they pay nothing.

At Northpoint, the non-cladding works are not covered by the building safety fund, so who will pay? The only option for the moment is to ask the leaseholders to pay, wearing their hats as shareholders in the resident management company, but that defeats the point of the caps the Government have proposed for leaseholders. There are many other examples of no liability on someone with assets to pay—the so-called orphaned buildings. It is unacceptable that dangerous buildings, part of this country’s housing stock, should remain in this condition either indefinitely or until prolonged litigation has been completed.

--- Later in debate ---

[Lord Greenhalgh (Con)]

I thank noble Lords who have spoken in this long—a little over an hour on one group—but important debate on ensuring that the polluter pays. I thank the noble Baronesses, Lady Hayman and Lady Pinnock, for Amendment 22, on the levy on social housing. The noble Baroness, Lady Hayman, raised the issues of exemptions from the building safety levy for social housing providers and who the details of the buildings levy will apply to in secondary legislation.

I am pleased to inform the noble Baroness that we are considering an exemption from the levy for affordable housing as a whole, including social housing, housing for rent or sale at least 20% below market rent or sales rates, and shared ownership. The Government recognise that applying a levy to affordable housing would increase the cost of developing affordable housing and would therefore be likely to disincentivise supply, as the noble Baroness said. We consulted on this exemption for affordable housing in our consultation on the levy, which ran from July to October last year.

I hope the noble Baroness understands that her suggestion is under careful consideration and will be addressed in secondary legislation. I will probably have to roughly translate: she should be reassured that the building safety levy will not apply to public housing. That probably makes it a little easier for her to decide what she wants to do.

I turn now to Amendment 200, on the leaseholder protection fund, tabled by the noble Baroness, Lady Pinnock, and the noble Lord, Lord Stunell, which would require the Government to use funds raised by the levy to refund leaseholders who have already paid for safety works. While a noble thing to do, the Government’s primary aim is and should be to protect leaseholders from building safety risks and enable work to be undertaken to ensure this. For this reason, we will not be able to accept the amendment.

On Amendment 221, I thank the noble Baroness, Lady Pinnock, for this amendment. We share her determination to make sure that the industry acts now to take responsibility for fixing building safety defects and that the burden should not fall on leaseholders or taxpayers. The whole tone of the amendment is to get on with remediation and I have great sympathy for that. The principal objective of Clauses 128 and 129 is to make sure that responsible parties pay and to enable us to hold the industry to account. The further amendment I spoke to earlier will make it clear that we can link the scheme to the planning system.

Together, these powers will allow us to monitor compliance of members of the responsible actors scheme and make sure that members take responsibility and act promptly to make buildings safe. We do not believe a 5-year deadline needs to be inserted into the Bill. Our intention is for the measure to achieve its objectives much more quickly. Those that do not meet the scheme conditions may lose scheme membership and may immediately be subject to the planning prohibition, as our amendments make clear. A focus on pace is already built into the Government’s approach. I hope this reassures the noble Baroness that her intention has been more than met by the Government through this Bill, just in another way.

I turn now to Amendment 231 on social landlords and defects, tabled by the noble Baronesses, Lady Hayman and Lady Pinnock. The Bill already makes provision to protect leaseholders from unreasonable costs and allow guilty parties to be pursued. It contains a requirement on landlords to take reasonable steps to pursue other cost recovery avenues before seeking to recover the costs of remediation works from leaseholders. They need to provide evidence to the leaseholders of the steps taken. Social landlords will have to undertake these measures, including pursuing construction companies or installers where applicable.

To help all landlords, including social landlords, the Government are bringing forward an ambitious toolkit of other measures to allow those responsible to be pursued. This includes extending the limitation period under Section 1 of the Defective Premises Act 1972 to apply retrospectively for 30 years. We are also allowing the High Courts to extend the reach of civil liability to associated companies and creating a new cause of action. This will allow manufacturers, distributors and sellers of construction products to be pursued where defective or mis-sold products have been used in the construction of a dwelling, or where further works are carried out to that dwelling, rendering it unfit for habitation. These amendments make it easier for those affected to force those responsible for defective buildings—developers and construction products manufacturers—to pay.

While we are making it easier to pursue third parties, in parallel, we continue to protect leaseholders, so they are not paying for unreasonable remediation costs. The Bill introduces new statutory provisions which provide that cladding remediation costs cannot be passed on to qualifying leaseholders in buildings over 11 metres. The law is already clear that service charges and any increase in cost must be reasonable. Finally, the Government set a rent policy for social housing which determines the maximum amount of rent that social tenants may be charged and the maximum amount by which rents may increase each year. The rent standard prevents unforeseen hikes to tenants’ rents and is enforced by the Regulator of Social Housing.

Turning now to Amendment 232 in the name of the noble Baroness, Lady Pinnock, and the noble Lord, Lord Stunell, the service charge is the means by which fire safety costs would be recovered and the leaseholder protections measures already prevent costs being passed to leaseholders above the permitted maximum.

I now turn to Amendment 233, tabled by my noble friends Lord Young of Cookham and Lord Blencathra, which seeks to impose a duty on local authorities to pursue responsible developers. It imposes requirements on local authorities to remediate buildings with defects and to recover funds from responsible parties. If no funds can be recovered, the Secretary of State would be required to reimburse the local authority.

We have been clear that industry is responsible for remediating defective buildings. We expect developers to remediate buildings they had a role in developing or refurbishing. Where this does not happen, building owners and landlords will have new powers to pursue those responsible. Local authorities will also have powers under our new remediation orders and remediation contribution orders, as will other regulatory bodies. However, to impose a duty on local authorities to fix buildings or pursue responsible parties is not the right approach. This would absolve industry of its duty to resolve the crisis and building owners and landlords of their responsibilities to make buildings safe. It would also place an unacceptable burden on the taxpayer.

The amendment seeks to create a taxpayer backstop by requiring the Secretary of State to reimburse local authorities for costs they cannot recover. We have been very clear that it is wrong to look to the taxpayer for further funding to fix defective buildings. For these reasons, we will not be able to accept the amendment. I want to deal with the specific issue of the remediator of last resort. I understand where my noble friend Lord Young is coming from. We have asked the industry to provide a fully funded solution for both the cladding and non-cladding costs, including fixing their own buildings and contributing to a fund for the very orphan buildings he has highlighted of between 11 and 18 metres that need cladding remediation. The focus of the industry is on fixing its own buildings, and therefore we can begin to be more focused on where we apply taxpayer funds.

Finally, I address Amendments 201, 202, 229, 234, 235, 236 and 237 in the name of the noble Earl, Lord Lytton. Amendments 201 and 202 would hold the Crown liable where properties escheat—that is probably not the right pronunciation—and would prevent liquidators and trustees in bankruptcy renouncing the leases of buildings with fire safety defects. The Bill already prevents freeholders evading liability by simply escheating their properties where they do not want to pay. It also makes provisions in relation to insolvency and bankruptcy. Freeholders will still be liable where they were, or were connected to, the developer, or had a net worth over £2 million per in-scope building on 14 February. As I have said before, taxpayers should not be held liable. For this reason, I will not be able to accept these amendments. Amendment 229 is unnecessary as landlords are already prevented from passing on costs unless they have explored all other routes of funding.

I turn to the important Amendments 234 to 237. These cover building safety cost orders, providing powers to make regulations, stipulating liability and establishing a building safety cost fund. Liability for remediation costs is already set out in the Bill, as are provisions for building owners and landlords to go after associated developers, companies and manufacturers of defective products. For this reason, I will not be able to accept these amendments.

My noble friends Lady Neville-Rolfe and Lord Young of Cookham raised the position of enfranchised leaseholders and asked whether we have made life harder for them via Amendments 186 to 193. I want to be absolutely clear that nothing in the amendments increases liabilities for enfranchised leaseholders. No leaseholder will be worse off; all are measures to make the polluter pays principle apply to enfranchised leaseholders.

I hope that I have gone some way to provide assurances on the Government’s approach.

[Lord Young of Cookham (Con)]

Before my noble friend sits down, I am really grateful to him for the explanation he has set out but can he tell the House what happens where there is a building and no one has any money— the leaseholders cannot afford it, there is no freeholder and there is no developer or contractor to pursue? Who then puts that building right?

[Lord Greenhalgh (Con)]

My Lords, in practical terms, we have a £5.1 billion fund, of which we have committed the first stage of £1 billion. We have an additional £4.1 billion for buildings over 18 metres and an additional £4 billion for cladding remediation, yet we are asking industry to fix its own buildings. That gives us the ability to focus on the few buildings my noble friend is talking about, because we have got the developers that built these buildings to go on and fix them in a proportionate way and we do not have to use the core of money that we already have. Noble Lords can test the opinion of the House, but that is a practical way of dealing with the problems—focusing the current funds on those few buildings where that scenario applies.

--- Later in debate ---

[Lord Young of Cookham (Con)]

My Lords, as noble Lords may know, I am not in the habit of making long speeches, but this group of amendments covers a huge range of issues and is arguably the most important group today. I am proposing seven amendments and I have added my name to four others. I will be as brief as I can, and the good news is that I do not propose to intervene in this debate again.

I will go through the amendments in the order in which they appear, starting with Amendment 115, moved by the noble Earl, Lord Lytton, to which I have added my name. It seeks to expand the service charge protection of Schedule 9 to buildings of all heights. At the moment, as we heard, buildings under 11 metres get no help at all from the proposed waterfall. Unless developers agree to fix those buildings voluntarily, or leaseholders are willing to engage in litigation, there is no meaningful help on offer.

As mentioned in earlier debates, buildings under 11 metres can be just as dangerous as buildings over 11 metres. The fire at Richmond House, the 9-metre building that burned to the ground in less than 11 minutes in September 2019, shows the dangers. Buildings under 11 metres are excluded, even though they have exactly the same defects, for which leaseholders bear no responsibility at all. They suffer exactly the same consequences as those in taller buildings: unaffordable service charges, repossession and bankruptcy. I see no equity or principle behind this decision, which is there solely to save money.

When we asked about this in meetings on the Bill, we were told there was no systemic problem with cladding in these buildings—a statement that brings no consolation to leaseholders, such as this one, one of many who have written to me. The letter says:

“I am a leaseholder in a building well under 11 metres. We are three storeys high with 10 flats. We are therefore excluded from any support from the Government, yet our freeholder/managing agent is taking us to court on Friday to ask them to agree to us having to pay for the cost of remediation—a £26,000 service charge in 2022 per leaseholder. We are told the freeholder does not have the means or obligation to pay for these works that we need to reduce the annual insurance premium. We are told that the only way to pay for these works is via the leaseholder and that we will be legally responsible to fund the money and pay it upfront so that the management agent has the means to pay for works.”


The letter continues:

“I hope the Minister will see fit to bring our needs in line with leaseholders in larger properties and protect us from at least some of the costs that we currently face.”


Last week’s Sunday Times had an article showing that, despite what the Government say, buildings under 11 metres remain unsaleable and unmortgageable, as quotes from the major lenders in the article underlined.

We were also told that there were not many such buildings. That is good news, but it follows from that that the extra cost of putting this inequity right is so small that I hope the Minister can accept it.

I should have said at the beginning that I am grateful to Martin Boyd, Liam Spender and Sue Bright, who in their personal capacity have helped me with some briefing.

I turn now to Amendment 117 in my name and those of my noble friend Lord Blencathra and the noble Earl, Lord Lytton. It seeks to expand the service charge protections to enfranchised buildings and buildings where the right to manage has been exercised. This would ensure that all leaseholders are treated equally.

It has been the policy of successive Administrations to encourage leaseholders to enfranchise and buy their freeholds, and to move away from a feudal system of tenure. That process began in the 1960s, when leaseholders could buy their houses, and was extended to flats in the 1990s. Since then, there have been other measures to encourage leaseholders to buy their freeholds, with the security of the independence that goes with it, and measures to promote and enhance right to manage. We are promised legislation in the next Session to take this policy forward.

Against that background, it would be perverse if the legislation before us today put enfranchised leaseholders in a worse position than leaseholders who are not enfranchised, but that is what Clause 120 does. The Government cannot hope to succeed in encouraging more resident-owned and resident-run buildings unless they treat all buildings affected by fire safety issues equally. As I understand the legislation, once your building is “not relevant”, it in effect becomes a second-class building in perpetuity.

I have looked at the government amendments tabled since Committee stage but they seem to make the position worse by confirming that these buildings are excluded. That means that people living in these buildings are being left to fend for themselves, either by undertaking litigation or by recovering what they can from the building safety fund. An excellent article in the recent edition of Inside Housing shows the problem with the fund:

“If the rate of remediation through the fund continues at this pace, it will be decades before all blocks receive funds—never mind see work completed.”


I hope that my noble friend will be able to confirm what he said in Committee, which appears to contradict what is in the Bill. He said:

“My noble friend Lord Young asked the very important question of whether enfranchised properties will have to pay all the costs for remediation. I want to be absolutely clear—read my lips—no, they are not. This will not apply to buildings which have exercised a right to collective enfranchisement, or to commonhold land, which in this case, admittedly, is very few buildings. New subsection (3) in government Amendment 63 is very clear on that point. I am happy to speak to my noble friend afterwards, but I am very clear that they are not expected to shoulder the burden. They are effectively leaseholders that have enfranchised as opposed to freeholders. I hope that helps.”—[Official Report, 28/2/22; col. GC 262.]


However, under Clause 20, these buildings are left to fend for themselves if the developer does not pay or if they do not have the wherewithal to engage in litigation against a well-resourced developer. They miss out on the guarantee in paragraph 8 of Schedule 9 that no leaseholder will have to pay for cladding costs, because they do not live in a relevant building. They are not treated as leaseholders but as freeholders.

My amendment does no more than achieve the ambition set out by the Secretary of State in another place on 10 January, when he said that

“we will protect leaseholders today and fix the system for the future.”—[Official Report, Commons, 10/1/22; col. 286.]

Perhaps my noble friend the Minister can confirm that, if you have not enfranchised, you are protected by the caps on what you can pay but, if you have enfranchised, there is no such protection. I hope that my noble friend will look at that again.

I turn to Amendment 123 in my name and those of my noble friends Lord Blencathra and Lady Neville-Rolfe. This would change the definition of qualifying leases so that buy-to-let landlords with interests in up to five properties, including their main home, benefit from the leaseholder cost protections in Schedule 9. While we welcome the Government’s movement on this, we would like to go a little bit further.

As I mentioned in Committee on 24 February, there are many buildings where flats are owned by buy-to-let landlords. If those landlords cannot pay their share of the bill, it will mean that not all of the money is available to do the works to the whole building and so remediation will not commence, to the disadvantage of all the residents in the block, who will continue to live in unsafe premises. Many landlords hold their buy-to-let properties as part, or in some cases all, of their pension provision. According to data that the Government provided in July 2021 in response to the noble Lord, Lord Carrington, of the 2.2 million buy-to-let landlords paying income tax, 1.5 million—68%—fell within the basic income tax band.

This point is reinforced by the recent report on the remediation and financing of building safety work by the Levelling Up, Housing and Communities Select Committee in another place. It said:

“Buy-to-let landlords are no more to blame than other leaseholders for historic building safety defects, and landing them with potentially unaffordable bills will only slow down or prevent works to make buildings safe.”


It wanted total exemption, but we do not go quite so far. The committee rightly pointed to the kinds of landlord who will be affected:

“We heard from landlords who find themselves outside of the scope of the protections, who invested in properties to support their children, to provide income after being made redundant, to help pay for the costs of caring for relatives, or to provide for their retirement, now facing bills they cannot afford. One contributor told us they had invested in flats using compensation from the Criminal Injuries Compensation Authority ‘after the murder of my husband in the 7/7 atrocity’ and now faces ‘vast bills’”.


Our amendment would align the provisions of the Bill more closely with the Bank of England’s definition of a portfolio landlord as being one with four or more mortgaged buy-to-let properties across all lenders in aggregate. It would also ensure that most private landlords who are leaseholders would be covered by the Bill. The Government’s most recent English private landlords survey shows that 83% of private landlords rent out between one and four properties.

I understand that the Minister has indicated to the National Residential Landlords Association that he might be open to considering a formula which would enable landlords to access support under the government scheme where their portfolio of properties is valued at a certain amount, instead of simply counting how many there are. There are huge variations in the value of property for a multitude of reasons. For example, someone who has 10 other properties may have significantly less means than someone who only owns one property. Yet the government approach will penalise the individual with less means purely because of the number of properties their own. Some buy-to-let owners may have significant equity in their properties while others may be mortgaged to the hilt or in negative equity. The current approach is very crude and does not differentiate between the wealth of those affected, so I wonder whether the Government are considering that option.

I move to Amendment 126, which is a technical amendment. At the moment it is not quite clear whether the protections being given to leaseholders can be sold on to future buyers. It is important that that should be possible, in order to get the market moving again. Clause 121 defines a “qualifying lease” as one held by “a relevant tenant”. A relevant tenant must on 14 February this year meet the occupation and property ownership provisions set out in Clause 121. The Government say that this clause allows protection to be passed from someone who qualifies on 14 February to a future buyer, but I am not sure that that is the case because the restrictions the Government are imposing on who can benefit from help, such as those owning more than four buy-to-let properties, depend on the same definition of relevant tenant.

If the Government’s view of Clause 121 is correct and the existing wording allows leases with protection to be sold on, the Government may have made a drafting error. If the lease can be sold and the protections passed to a buyer, the characteristics of the buyer are irrelevant. If so, it means someone with 10 flats—six more than the four allowed—could come in, buy up a lease and still get protection. I do not think that is what the Government intend. It is important that we get the market moving, but also that we do not give opportunistic cash buyers the chance to buy up these leases and benefit from protections that other buy-to-let landlords will not get.

Amendment 153, which amends government Amendment 152, is technical. Given the passage of time and the fact my notes are in very small print, I think I will pass over that.

I turn now to Amendments 157 to 160 and 163, which are really important. They deal with the amount leaseholders have to pay for non-cladding costs. On this, my preference is for Amendments 155 and 156, which mean zero liability; the leaseholder pays nothing. The Government say these caps are necessary because of legal advice. The claim is that to impose measures on developers and landlords, it is necessary for leaseholders to contribute in some cases.

As with all legal matters, there appears to be a diversity of opinion among professional lawyers on the Government's judgment that Article 1, Protocol 1 requires leaseholders to contribute anything. But if my noble friend the Minister advises your Lordships that those two amendments—the ones with zero cost—mean that he can no longer assert that the legislation is compatible with the ECHR, then Amendments 157 to 160 come into play and limit the liability. My noble friend Lord Blencathra will speak to Amendment 158.

--- Later in debate ---

Moved by

[Lord Young of Cookham]

117: Clause 120, page 127, line 33, leave out subsection (3)
Member’s explanatory statement
This amendment ensures leaseholders in enfranchised buildings are not excluded from the protection in the Bill.

Building and Fire Safety: Leaseholders

Lord Young of Cookham Excerpts

Monday 14th March 2022 Lords Chamber

[Lord Greenhalgh (Con)]

My Lords, I thank the noble Lord for putting me in the hot seat. We have done an awful lot. It is fair to say that through regulation we can ensure that we protect leaseholders, who are very much the victims, from bearing anything apart from, I hope, very minimal costs. Those have been capped at £15,000 over five years in London and £10,000 outside London. That is for the narrowest shoulders, particularly shared owners, who are protected as well. We can always do more, and I appreciate that that campaign reckons that we should take this down to zero. However, we continue to ensure that we protect leaseholders wherever we possibly can.

[Lord Young of Cookham (Con)]

My Lords, I welcome what my noble friend just said but I remind him of what the Secretary of State in another place said on 10 January:

“First, we will make sure that we provide leaseholders with statutory protection … and we will work with colleagues across the House to ensure that that statutory protection extends to all the work required to make buildings safe.”—[Official Report, Commons, 10/1/22; col. 291.]


I welcome the amendments that my noble friend has tabled in Committee but does he recognise that further substantial amendments will be necessary on Report if that commitment is to be honoured?

[Lord Greenhalgh (Con)]

I thank my noble friend for stepping in helpfully. Of course, as we approach Report, the Government will bring forward further amendments that will do more to protect leaseholders but will also ensure that the polluters must pay—my noble friend and I share that principle.

Building Safety Bill

Lord Young of Cookham Excerpts

Committee stage
Monday 28th February 2022 Grand Committee

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

My Lords, I can see that my noble friend is about to rise, but there is a crescendo in this group of amendments and I realise that it is very important to hold in reserve the speeches from my noble friend Lord Young—as well as the crescendo of the amendments to be introduced by the noble Lord, Lord Stunell, and by my noble friend Lady Neville-Rolfe. This is a veritable feast of amendments, so I will introduce the government amendments at this point, if I may, before I summarise the group.

As this is a feast of amendments, I have looked up my old grace, which I used to say when I was 18, 19, 20 years of age. It is very long—I hope I will not get it wrong, as I know the right reverend Prelate will know if I do. It goes as follows:

“Oculi omnium in te sperant Domine:


Et tu das escam illis in tempore.

Aperis tu manum tuam,

Et imples omne animal benedictione.

Benedic, Domine, nos et dona tua …

et concede, ut illis salubriter nutriti

tibi debitum obsequium praestare valeamus,

per Christum Dominum nostrum.”

That is roughly right. It is what we used to say before we could eat. This is a feast, and I appreciate that every amendment is laid with the interests of improving this Bill. If we cannot accept them, I want to say that I appreciate the intentions behind every one of them. I will summarise our position at the end.

I have tried to summarise each group in three words. This is the “residents and redress” group, and I have always been clear that residents should be at the heart of the new regime. Today’s debate demonstrates the continued importance of that commitment. I am pleased to start by speaking to a group of amendments that is focused on ensuring that residents and others have more access to redress.

Amendments 76 and 77 create a new power for the High Court to impose building liability orders in appropriate cases. These orders will allow civil claims to be made against the associated companies of a company involved in the development or refurbishment of a building in certain circumstances, including when the original company no longer exists. In this House and in the other place, we have discussed the lack of ongoing liability that large developers have due to their use of special purpose vehicles. These amendments directly address this issue and support the changes we have proposed to the Defective Premises Act. They rebalance the level of exposure that small and medium-sized businesses in the construction industry currently have compared with the larger players—and, most importantly, they unlock potential funding for those who have remediated or who need to remediate, if they bring a successful claim. I consider that these orders will be an important tool in holding “polluters” to account and making them pay for their past misdeeds—so I hope that noble Lords will join me in supporting these amendments.

Moving on, I have also tabled a series of amendments that will help to make sure that construction product companies pay to put right building safety issues that they have contributed to causing. I do not intend to move these amendments today but have laid them to invite the scrutiny of noble Lords. I will listen carefully to the debate and bring these measures back at a future stage. Briefly, they target construction product manufacturers and ensure that they take responsibility for their part in the creation of building safety defects. The new clauses in Amendments 107 to 109 and 144 introduce two new causes of action against construction product manufacturers. There are currently almost no routes which allow leaseholders to hold construction product manufacturers accountable for their role in the creation of serious building safety defects. The Government are clear that those who have been responsible and continue to be responsible for building safety defects have a responsibility to put them right.

These causes of action will enable claims to be brought against construction product manufacturers and sellers for their role in the creation of building safety defects. They will apply if a product has been mis-sold or is found to be inherently defective, or if there has been a breach of construction product regulations. If this contributes to or causes a dwelling to become “unfit for habitation”, a civil claim will be able to be brought through the courts under these causes of action.

The cause of action relating to cladding products in Amendment 107 will be subject to a 30-year retrospective limitation period. The broader cause of action relating to all construction products in Amendment 108 will be subject to a 15-year prospective limitation period. These limitation periods reflect the changes we are making to the limitation period under Section 1 of the Defective Premises Act. These causes of action will ensure that construction product manufacturers can be held responsible for the costs of rectifying their mistakes.

Amendments 110, 113, 114, 141 and 145 will create a power to make regulations to require construction products manufacturers and their authorised representatives, importers and distributors to contribute towards the cost of remediation works where they have caused or contributed to dwellings being unfit for habitation. Amendment 110 will enable the Secretary of State to serve a costs contribution notice on companies that have been successfully prosecuted under construction products regulations, where the relevant product has contributed to identified dwellings being unfit for habitation.

Amendment 114 introduces a new schedule that will give the Secretary of State the power to appoint an independent person to inspect buildings where the relevant product has been used. This assessment will consider whether the conditions for serving a costs contribution notice are met, and the remediation works required. Amendment 114 will enable the Secretary of State to make regulations setting out a process for establishing costs that a company should be required to pay, which will take account of its ability to pay, and to whom payment should be made. This amendment will also enable the Secretary of State to require a company to contribute towards the cost of building assessments carried out as part of this process. Setting out this scheme in secondary legislation will enable the necessary interaction between costs contribution notices and construction products regulations, including those that will be made using the powers in this Bill.

I will listen carefully to the remainder of the debate today, as I have to every speech given so far introducing various amendments, and I look forward to hearing from noble Lords. As I said earlier, I will be moving only Amendments 76 and 77 today. I will carefully consider what I have heard in relation to the other amendments, and I will bring these measures back at a future stage.

[Lord Young of Cookham (Con)]

My Lords, the instructions on the sheet of paper in front of me are not “crescendo” but “diminuendo”—some gentle accompaniment on the bass to the forte soprano that we heard from the noble Baroness, Lady Fox. But seriously, I want to add a brief footnote to the excellent speeches made by the noble Baroness, my noble friend and the right reverend Prelate.

I make the point that they all underline the need for the next stage of leasehold reform which the Government have promised, which does away with this feudal system of leasehold which exists nowhere else in the world. Once we have done that, all these problems that we have been talking about this afternoon will disappear: there will be an identity of interest between the freeholder and the leaseholder because they will be the same person. At some point, perhaps the Minister can shed some light on the next stage, confirming that that is indeed the Government’s objective and that they want to move in that direction as fast as possible.

I add a brief footnote to the excellent speech the right reverend Prelate made on Amendment 50A. In particular, I draw attention to the radical proposal in subsection (3)(a) of the new clause proposed in his amendment, which places an obligation on the landlord for

“where there is no recognised tenants’ association in existence before the coming into force of this section, creating a recognised tenants’ association and consulting with it about building safety”.

Because of the Long Title of the Bill, the right reverend Prelate had to confine it to building safety. However, it is a radical proposal. It places the obligation for establishing a tenants’ association not on the tenants, which is the position at the moment, but on the landlord, evening up the terms of trade. As I said, it is a very radical proposal indeed. An indifferent landlord does not want a residents’ association or a tenants’ association with whom he has a statutory obligation to consult, although I happen to believe that it is in his best interests to have such a dialogue. So the terms of trade are dramatically altered by the right reverend Prelate’s amendment.

In an earlier incarnation, I recall helping establish an organisation called Tpas—the Tenant Participation Advisory Service—I see the noble Lord, Lord Best, nodding sagely; he has a similar vintage to myself when it comes to housing legislation. That was focused primarily on tenants of social landlords, but I believe it has subsequently expanded into the private sector. It would be very well placed to advise landlords and tenants on how to set about establishing such an association, were the right reverend Prelate’s amendment to be accepted.

Finally, on this group of amendments, I reread chapter 4 of the Hackitt report last night, entitled “Residents’ voice”, and it has a whole series of recommendations about enfranchising the resident and the tenant in exactly the way that we have underlined. So, as I said at the beginning, I add a small a complement on the double bass to the excellent speeches that have been made on this group of amendments—or perhaps I am a tenor.

[The Earl of Lytton (CB)]

My Lords, I will try to be brief here. This is an extremely valuable group of amendments, and I entirely relate to the point made by the noble Baroness, Lady Fox, and the noble Lord, Lord Blencathra.

I will comment on something that the noble Lord, Lord Young of Cookham, said. He introduced the question of, if I paraphrase him right, the undesirability of the long-term continuation of conventional long leasehold, and I understand that. For some years I chaired the Leasehold Advisory Service when it was first set up, which was in response to a ministerial commitment that it should be put in place and that there should be advice to leaseholders.

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Moved by

[Lord Young of Cookham]

56: Schedule 8, page 197, line 7, at end insert—
“(1A) Such a charge is for all purposes to be treated as a service charge within the meaning of section 18 of the Landlord and Tenant Act 1985.”Member’s explanatory statement
This amendment, along with others to Schedule 8, preserves the existing Building Safety Charge but treats it as a service charge due under the lease to be demanded and regulated in the same manner as existing service charges. This is to ensure that there are not two parallel sets of demands, accounts etc, one for the normal service charge and one for the building safety charge.

[Lord Young of Cookham (Con)]

My Lords, I recognise that the government amendments in this group may be of greater significance than mine. I think it would be in the interests of the Committee if I sat down and allowed the Minister to explain them, and perhaps responded later. I beg to move.

[Lord Greenhalgh (Con)]

My Lords, I rise to introduce the government amendments in this group. This is an important group—equally as important as the previous group—and is about leaseholder protections.

We have been clear that it is fundamentally unfair that innocent leaseholders, most of whom have worked hard and made sacrifices to get a foot on the property ladder, should be landed with bills they cannot afford for problems they did not cause. That is why I have laid a series of amendments to the Bill to right this wrong. I want to outline these important government amendments and highlight how they will provide much-needed protections to leaseholders from exorbitant costs for remediation of their buildings.

These leaseholder protection provisions will make landlords liable, partially or in full, for the costs of remediating historical building safety defects. Amendments 62 to 64 and Amendment 66 are definition clauses setting out the types of defects, buildings and leases that are in scope of the protections. The new clauses state that leaseholders living in their own home or subletting in a building over 11 metres will be entitled to protections from unjust and unaffordable remediation costs. It will not apply to buildings that have exercised the right to collective enfranchisement or are on commonhold land, as in those buildings the leaseholders together effectively are the freeholders.

Amendment 68 would insert a new schedule into the Bill before Schedule 9, which sets out the circumstances in which service charges relating to historical building safety issues cannot be passed on to leaseholders, and the circumstances where service charges can be passed on to leaseholders are limited. Paragraph 2 of the new schedule provides that, where the landlord is responsible or has links with the developer that is responsible for the defect, they will be required to pay in full for the historical building safety issues. This will ensure that, as far as possible, those who are responsible for creating the defects take on the burden of costs and remove all liabilities for the historical defects from innocent leaseholders.

A definition of an “associated person”, for the purpose of determining which building owners have links to the developers of the building, is set out in Amendment 67. Similarly, where building owners are not linked to the developer but can afford to pay, they will be required to put the money up to do so and pay in full. We intend to table further amendments to provide details of the affordability test on Report. I welcome any suggestions from noble Lords on how this could work.

Paragraphs 5 to 7 of the new schedule provide that, where building owners are not linked to the developer and are not able to afford the remediation, some costs can be passed on to leaseholders. This will be subject in most cases to caps of £10,000, or £15,000 for leases in Greater London. These caps will limit how much leaseholders can be asked to pay for non-cladding costs, after—I repeat, after—building owners and landlords have exhausted all other cost recovery options, such as litigation under the Defective Premises Act or the new construction products causes of action we have just debated.

The amendments also provide that any costs paid out by leaseholders over the past five years will count towards the cap, meaning some leaseholders will pay nothing more. They also provide that cladding costs cannot be passed on at all. Paragraph 6 sets out caps to be applied to very high-value properties. It provides that, for properties with a value of over £1 million but under £2 million, the maximum permitted charge is £50,000 and, for properties with a value of over £2 million, the permitted maximum is £100,000.

Building owners and landlords must comply with the law as set out by Parliament. However, there may be some who attempt to avoid their liabilities. These landlords may be associated with a company with substantial assets. Given the extent of the building safety crisis, it is morally right that these associated companies are asked to shoulder their fair share of the costs. Amendment 69 would give the First-tier Tribunal powers to make a remediation order on the application of an interested person, meaning the regulator, local authority, fire and rescue authority or another person specified in regulations by the Secretary of State. A remediation order will require a landlord to remedy defects in their building, as specified in the order.

Amendment 70 would give the First-tier Tribunal powers to make a remediation contribution order on the application of an interested person if it considers it just and equitable to do so. For the purposes of Amendment 70, interested persons include the new regulator, the local authority and the fire and rescue service, as well as leaseholders and other persons who have a legal or equitable interest in the building. A remediation contribution order will require an associated company to make specified payments, at a specified time or event, to the landlord to remedy relevant fire safety defects in the building.

Where a company needs to be wound up, our provisions enable the liquidator to apply to the court to access the assets of associated companies to contribute to the remediation of building safety defects. All too often, companies let subsidiaries go into liquidation to cut their losses. It is morally wrong that they can just fold a company up and leave leaseholders in unsafe buildings with outstanding building safety defects and the corresponding liabilities. The court’s decision will be based on whether it is just and equitable to do so—in other words, whether it is right for that associated company to help to meet the building safety remediation liability of the failing landlord.

Some unscrupulous companies may try and wind up subsidiaries before these provisions come into force, which is why we have included provisions to enable liquidators to pursue associated companies of those landlords who are currently going through insolvency proceedings. It is unfair that innocent leaseholders have had to pay for remediation of building safety defects while those who caused the fire safety issues are able to exploit company law to escape liabilities that are morally theirs. I ask your Lordships to support this significant and important set of amendments.

[Lord Young of Cookham (Con)]

My Lords, I am grateful to my noble friend. It was bit like listening to one of the advertisements on the radio when, right at the end, all the terms and conditions are read out very quickly and one has to listen to them very carefully. I welcome the assurances that my noble friend gave right at the beginning; I will come back in a moment to some of the things he said.

In the meantime, I will speak to Amendment 56 in my name and also to Amendment 131 in the name of two of the three wise men. This group of amendments focuses on Schedule 8 to the Bill, which defines building safety charges. It takes up no less than 12 and a half pages of rules and regulations. My Amendments 58 and 60 would eliminate eight of them, but any benefit so gained would be wiped out by the 13 government amendments tabled since the Bill left the other place.

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[Lord Young of Cookham (Con)]

I was explaining to the Committee that an existing service charge has a line headed “Health and safety”. Under Schedule 8, that line will have to be removed and relocated under the new building safety charge—or it will appear again under the building service charge with an appropriate credit because you have already paid it in your safety charge. Crucially, leaseholders will have to bear the costs of running, in effect, another set of service charges. The noble Baroness, Lady Fox, touched on some of these issues in an earlier debate.

I have read Schedule 8 and the Explanatory Memorandum. While, as far as I can see, it does not expressly forbid the incorporation of the building safety charge with the normal service charge, the whole structure of Schedule 8 certainly gives that impression, because the Secretary of State is able to apply different dates for the building safety charge and the service charge; and he can specify different deadlines for paying the two charges and for landlords to respond to requests from leaseholders. The whole impression given by these pages is of unnecessary, bureaucratic parallel invoicing processes, with all the business of reconciling accounts and all the costs to be borne by the leaseholders. I hope that the Minister will be able to assure me that this is not the intention and that it will be possible to incorporate the building safety charge into the service charge—and that the necessary amendments will be made if that is not the case.

On a related point, if you develop a building safety charge that is separate from the service charge, the entire body of case law that we have that relates to the service charge will not apply to the new building safety charge and we will have to start from scratch. So I very much hope that we can streamline the whole process and, with all the transparency that is necessary, incorporate the building safety charge into the existing service charge.

My other amendment is Amendment 131, which is very much a probing one. It is a continuing injustice that leaseholders are paying the costs of others’ mistakes. Some leaseholders have paid the full cost of remediating their buildings. For example, at Skyline in Manchester, they have had to pay the whole amount and have had to borrow substantial sums for remediation. Others continue to pay for waking watches and increased insurance costs. Ideally, there should be some means of compensating these leaseholders, who are, in the words of the Secretary of State, “innocent”. But I recognise the problems of retrospection, even though there are precedents.

This amendment requires the Secretary of State to commence a public inquiry to inquire into the costs of remediation and mitigating measures incurred by leaseholders after 10 January 2022 that are not otherwise recoverable through the Bill. The date of 10 January has been chosen because it is the date of the announcement in the other place about statutory protection for leaseholders.

The proposed inquiry’s aim would be to come up with methods of compensating affected leaseholders for the sums they paid after that date—which, as I said, are not covered by the Bill. Perhaps my noble friend can shed some light on exactly what protection is intended. There may be measures to stop freeholders pressing ahead now, before the Bill comes into effect, and passing costs on to leaseholders who would otherwise be protected. There are certainly leaseholders who think they have statutory protection now—but what about invoices received but not paid for work that is in progress? What about service charges payable when the next quarter begins on 1 April, possibly before the Bill has become an Act? There is a grey area here, on which some light should be shone, and I hope that in his reply my noble friend will be able to shed some illumination.

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[The Earl of Lytton (CB)]

I said commercial developers, but I meant to say “developers of commercial property”. However, I will leave that point for the next debate.

[Lord Young of Cookham (Con)]

My Lords, as the Committee enters its sixth hour of sitting, this is not the time for a comprehensive wind-up. However, I thank all those who have taken part in this debate.

My noble friend Lord Naseby made a valuable point about buy-to-let investors. Over the past 10 or 20 years, buy to let has become an alternative to a conventional pension for many people. I am grateful that my noble friend the Minister said that he is open to discussion on this; we count that as a win.

My noble friend Lord Blencathra had a series of amendments on the theme of protecting leaseholders. I am grateful for them.

My noble friend Lord Leigh of Hurley made a legitimate point about the freeholder who had not claimed the money he could have. I wrote down the solution that my noble friend the Minister arrived at. He said, “We will fix it at the political level.” The mind boggles as to what exactly that involves but I am sure that, with his robust physique and experience of government, he will come up with a satisfactory outcome on that.

The amendment in the name of the noble Baroness, Lady Pinnock, would remove the cap for leaseholders. I have a lot of sympathy with that. New paragraph 2(1), proposed by government Amendment 92, states:

“No service charge is payable under a qualifying lease in respect of a relevant measure relating to a relevant defect if a relevant landlord … is responsible for the relevant defect.”


That is fine, but then there is a whole series of exclusions, of which this is one. I find it difficult to reconcile the cap with the principle that the leaseholder is innocent and should not pay; I think we will have to come to back to that.

The noble Earl, Lord Lytton, made the same point as my noble friend Lord Leigh of Hurley: that the leaseholder should be able to apply. If the leaseholder could have applied in my noble friend’s case, there would not have been a problem and the freeholder would not have been in the loop, as it were.

I am grateful to my noble friend Lady Neville-Rolfe for supporting a number of the amendments. The noble Baroness, Lady Hayman, had her own, thoughtful approach to protecting leaseholders. She referred to the cascade. I hope that her many questions will be answered; perhaps we can all share in the letter that goes round. She also supported the request for an inquiry into compensation, for which I am grateful.

On the waterfall, the Government did not seem to appear in it. I thought that they were right at the end, but they have somehow been left out. I think that the Government are at the end of the waterfall if all else fails; my noble friend the Minister is indicating that this may not be the case, but what are the levy and fund for if not to help where the costs are not otherwise met by the freeholder, the leaseholder or the developer?

The noble Lord, Lord Stunell, asked how the cap was arrived at. It may well have been through a reverse process involving the Treasury.

Finally, my noble friend the Minister said that I thought he was a snake oil salesman. I believe that he believed what he said; my comment was about the pace at which he said it, which was like an advertisement where the terms and conditions are spelled out at an accelerated pace and one does not really have time to hear them. I think my noble friend said that enfranchised leaseholders are now within the scheme; I think he said that because I read his lips. I find that difficult to reconcile with what is in government Amendment 63:

“‘Relevant building’ does not include a self-contained building or self-contained part of a building … in relation to which the right to collective enfranchisement … has been exercised.”


If that should not be there, that is fine, but that is how I read it; I also made that point in an earlier contribution.

[Lord Greenhalgh (Con)]

We can sort it out. I am told by my lawyer that you are wrong.

[Lord Young of Cookham (Con)]

If I am wrong, the Bill may be wrong, because I have just read out what is in it, but I think this is something we can sort out at the political level.

I am grateful to all noble Lords who have taken part in this debate. I beg leave to withdraw my amendment.

Amendment 56 withdrawn.