No-fault Evictions

Baroness Altmann Excerpts

Wednesday 27th January 2021 Lords Chamber

[Lord Greenhalgh (Con)]

I am not specifically aware of such a cost-benefit analysis, but we will certainly look into that as we develop policy in this area.

[Baroness Altmann (Con) [V]]

My Lords, I declare my interests as in the register. Does my noble friend agree that tenants must have confidence that their landlords will treat them properly, but that the law should not penalise landlords unfairly—most of whom are responsible, have only one or two properties and may have lost significant amounts of rental income in the pandemic? I agree that we must be careful not to give unbalanced rights to tenants to occupy indefinitely—for example, if their landlord needs to sell or move in themselves.

[Lord Greenhalgh (Con)]

My Lords, it is very important that, when we remove the ability to evict someone through no-fault evictions and Section 21, we also strengthen the rights where there are specific grounds for eviction. That is the nature of the tenancy reform and the Bill that we will bring before the House.

Housing: Leasehold

Baroness Altmann Excerpts

Tuesday 5th January 2021 Lords Chamber

[Lord Greenhalgh (Con)]

Commonhold exists today but the noble Baroness is absolutely right that this will require change, which is always difficult. Never underestimate the power of the status quo. Discussions have happened and will continue to take place with interested parties such as the lenders, which are so important to making this a success.

[Baroness Altmann (Con) [V]]

My Lords, I am delighted that my noble friend has confirmed that the Government will act on these excellent reports, and the sooner the better—as far as I can glean, it may well be coming. Might my noble friend comment also on the Government’s position on the “right to manage” elements of the various reports, which make it easier for tenants with difficult freeholders to manage their properties in their own interests?

[Lord Greenhalgh (Con)]

My Lords, I have just looked at the index of things that we are working on. That policy is still in development, but it is important that we get it right—it is a tricky area.

Covid-19: Places of Worship

Baroness Altmann Excerpts

Tuesday 3rd November 2020 Lords Chamber

[Lord Greenhalgh (Con)]

My Lords, I recognise that a difficult decision has been taken by this Government and we are bound by collective responsibility. However, I am very happy to make those representations on behalf of people of all faiths and none to ensure that the core mission of places of worship can be fulfilled at the earliest opportunity.

[Baroness Altmann (Con)]

My Lords, I sympathise with my noble friend who in turn, as the House can tell, has enormous sympathy with the views expressed. I implore him to help colleagues and the Prime Minister understand the impact on mental well-being, the sense of belonging and the social capital of our nation. These are being eroded, and the sense of community that sometimes gets people out of bed in the morning has been put at risk. These places of worship have put in place so much protection: many are safer than your Lordships’ House. I hope that the Government might reconsider.

[Lord Greenhalgh (Con)]

My Lords, my noble friend puts her point very eloquently. I understand the effort that places of worship have taken to make themselves Covid-secure for a whole range of activities, including the core important function of communal worship. Again, I will make every endeavour to ensure that the Government recognise that. I invoke the name of the Chief Rabbi, who told me that people of faith tend to live longer and have a better quality of life precisely because they converge in a communal way.

End of Eviction Moratorium

Baroness Altmann Excerpts

Thursday 24th September 2020 Lords Chamber

[Lord Greenhalgh (Con)]

My Lords, the noble Baroness raises the issue of Gypsy, Roma and Traveller communities and how we can protect them specifically. The Government are developing a Gypsy, Roma and Traveller strategy. It will include measures on how we can support those who are rough sleeping in the Roma community. I point out that the same rules that have been issued to the courts will also apply to that community, namely that there will be no enforcement of evictions in areas of local lockdown and over the Christmas period.

[Baroness Altmann (Con)]

My Lords, I declare my interests as set out in the register. Not all private landlords are unreasonable and around half have only one property. Equally, not all tenants behave reasonably. Of course, homelessness is a tragedy. However, does my noble friend agree that it is only right, especially after such a long time with courts not operating, to give private landlords the ability to recover their property in cases where they need to and tenants are not behaving in ways that are fair to landlords?

[Lord Greenhalgh (Con)]

My Lords, I completely agree with my noble friend. In fact, it was the Master of the Rolls, Sir Terence Etherton, and Mr Justice Knowles who made it clear that they want to see access to justice and the courts for both landlords and tenants. We need to strike a fair balance so that landlords are able to access justice, alongside measures to protect the most vulnerable. I think we strike that balance with these measures.

Town and Country Planning (Permitted Development and Miscellaneous Amendments) (England) (Coronavirus) Regulations 2020

Baroness Altmann Excerpts

Thursday 10th September 2020 Lords Chamber

[Baroness Altmann (Con)]

My Lords, I declare my interests as set out in the register. I have enormous sympathy with the comments made so excellently by the noble Lord, Lord German, and others. However, I also have sympathy with the Government’s position on this SI. It is a mixture of temporary and permanent measures, which is a shame if it is badged as a coronavirus measure, which should not cover the permanent angle. Affordable housing should be introduced and increased across the country, but that can be addressed separately.

I share some of the concerns expressed by the Delegated Powers Committee on how neighbourhood concerns will be taken into account, but I am reassured that this must be subject to successful prior approval applications. Those applications must have adequate provision for natural light; they will check to make sure that they are not on hazardous sites and that there is no extra flooding risk; it must be built within three years; it will pay the community infrastructure levy. There are controls on this via that route.

I understand that there is significant concern, but, like my noble friend Lady Redfern, I think the Government have a point here, particularly on the issue of developers. Big profits for developers are principally stoked by actions of monetary policy, which have deliberately inflated asset prices across the economy as a policy objective for economic growth. Without additional development, how can we address the housing shortage? Of course affordable housing is required, but that will be necessary in addition to any of this. I do not believe it is possible to build the scale of housing that we need to redress the shortfall between supply and demand without some disruption somewhere.

Therefore, I think that these measures deserve our support overall. However, I have one question for my noble friend. If the existing building has a prior planning condition limit on, for example, the number of units or how far it can be extended, could the owner of that building now make a new application to override that historic limitation for permission to extend it under this new SI?

Planning Rules

Baroness Altmann Excerpts

Tuesday 28th July 2020 Lords Chamber

[Lord Greenhalgh]

My Lords, as someone who was a local councillor for 16 years and the leader of a council for six years, I point out that simply because you have prior approval does not mean that local communities are unable to comment. They can comment on individual applications for prior approval under the consultation requirements set out in the general permitted development order of 2015. There are ways to make your voice heard, even if there is a presumption that things will go ahead in the ways outlined in the PD rights.

[Baroness Altmann (Con) [V]]

My Lords, can my noble friend explain to the House what the Government’s targets and aims are for building more affordable homes that we desperately need, and how these new measures are expected to impact affordable homes supply?

[Lord Greenhalgh]

These new measures are about unlocking housing potential and housing growth for the much-needed homes that we need. I point to the fact that we are investing £12 billion to build affordable homes between 2021-22 and 2025-26, which is the biggest single cash investment in affordable housing for a decade. I hope that that reassures my noble friend.

Business and Planning Bill

Baroness Altmann Excerpts

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Monday 13th July 2020 Lords Chamber

[Baroness Bowles of Berkhamsted [V]]

My Lords, I have two amendments in this group and thank the noble Lord, Lord Stevenson, the noble Baroness, Lady Altmann, and my noble friend Lord German for their support. These amendments follow up on points I made at Second Reading about whether it was right to suspend all of Section 140B of the Consumer Credit Act or, as my Amendment 46 suggests, only where it is related to affordability and terms required by the Bounce Back Loans Scheme.

In this context it is important to note that neither Section 140B on court remedies nor Section 140A defining the scope of an unfair relationship is limited to, or specifically mentions, matters of affordability. The court can take all matters into consideration and, if truth be told, there should be no need for any waiving of the section as the government terms for bounce-back loans would be taken into consideration.

We know that the banks want belt-and-braces protection and I would give them that on affordability, but it is wholly wrong to remove every protection, giving banks belt and braces while stripping small businesses naked against other overbearing activity; charges and default procedures immediately spring to mind.

The Minister explained in reply at Second Reading—I can agree with this—that the Government have put conditions to the loan that are intended to ensure it is sustainable, limiting to 25% of turnover with fixed, affordable interest as well as the 100% guarantee. I also agree that the businesses need to take responsibility. Despite that, defaults will inevitably happen because it is unpredictable what the effects of coronavirus will be.

The question then becomes: what governs subsequent behaviour? On the one hand—I am sure this worries the Treasury—what incentives are there for banks to try very hard to get repayment, especially if they get too tough and people like me make a fuss and cause them reputational harm? Is it not easier for them to just rely on the government guarantee? On the other hand, the relationship between a lender—or a lender pressed by government—and a small debtor is inherently one of the powerful against the weak and can be abused.

In the Commons, Kevin Hollinrake said that as co-chair of the All-Party Group on Fair Business Banking he supported

“the suspension of the Consumer Credit Act 1974 with regard to bounce-back loans due to affordability issues,”

and asked:

“but does the Secretary of State agree that it is vital that lenders still comply with the requirement to treat customers fairly in the collection process or if there are debt issues later on and that forbearance is applied?”

The Business Secretary replied:

“my hon. Friend raises an incredibly important point. Yes, forbearance is part of these measures, and we would expect that very much to apply.”—[Official Report, Commons, 29/6/20; col. 52.]

At Second Reading last week the noble Lord the Minister said that the Government were convening workshops with lenders to discuss how they will seek to recover loans where feasible, but none of that guarantees or restrains what lenders will do.

Although the lender cannot require security over personal property, security over the assets of the business is still possible, which may well be the essential tools of the trade, so carefully put out of reach during moratorium in the recent insolvency Act. What is to stop that at the first sign of default? As noble Lords have frequently reminded the Government, it is not the friendly local bank manager who deals with defaults; they go to the hard-nosed recovery units, where even the existing consumer protections seem to have held little sway, because small businesses cannot afford to take the matter to court and the FCA is reluctant to intervene in contracts, one-sided though they may be.

None of this, however, justifies removal of the last-stand method of redress of the courts for matters that are an improper use of unequal power: no protection against gouging behaviour over charges as soon as there is any default; no protection for excessive demands over security of a business’s assets; no preventing the use of the bounce-back loan default to trigger other eventualities, perhaps to force unfavourable loans or restructuring, which might then include instances where personal guarantees have been given. All those possible actions, of types seen in the past, seem to be outside the spirit of the bounce-back loans and the assurance given by the Business Secretary in the Commons, but how will they be prevented or rectified?

Disapplying the court remedy is removing a safety net available in all other circumstances. Why should it not apply here? Further, it seems that corresponding FCA discipline may also be disapplied, and other consumer credit matters have already been disapplied through statutory instruments. Returning to the matter of the workshops with lenders, will the outcome of those workshops be shared with Members of this House or the public?

It is not that I am necessarily expecting the worst behaviour, but the law must be able to address the worst. Therefore, I have put forward two amendments. Amendment 46 is exactly what Kevin Hollinrake said, and states that the disapplication should apply only

“insofar as such an order would relate to affordability or terms of the credit agreement required by the Bounce Back Loan Scheme.”

Amendment 47 says that:

“Repayment, rearrangement, fees or other new requirements may not be imposed on Bounce Back Loans in consequence of terms in or trigger events in other financial agreements with the lender.”


This is to prevent the kind of reach-through that I have mentioned previously.

Finally, I must mention that I understand Amendment 48, in the name of the noble Lord, Lord Stevenson, and his anxiety to get at the statistics of bounce-back loans. I add that, in a year’s time, I will start to become anxious to have statistics on repayments, defaults and forbearance. I beg to move.

[Baroness Altmann (Con) [V]]

My Lords, I support Amendment 46, to which I have added my name, and congratulate the noble Baroness, Lady Bowles, on her vigilance with respect to small businesses that are in a weakened financial state due to the Covid-19 restrictions; and her efforts to assist them in facing the large banks that may be trying to recover bounce-back loans, or penalise struggling firms in ways that were never intended by emergency legislation. I also congratulate the Government on their bounce-back loans initiative. However, I believe that this amendment is necessary to potentially address the asymmetry of power, which is a significant potential threat to the future of many hard-hit SMEs.

SMEs could face draconian recovery tactics, such as were employed by the infamous Global Recovery Group after the 2008 financial crisis, whether in the form of excessive fees or the taking over of business assets. The noble Baroness, Lady Bowles, is right that a court remedy is essential, not least to avoid giving a potential carte blanche to some of the less scrupulous bank executives.

Many banks wish to behave well, but this amendment is aimed at those who may not do so and is trying to anticipate and deter some of the practices that we have seen before. Bounce-bank loans are surely intended to help as many businesses as possible bounce bank, especially SMEs, rather than to offer a heads-you-win, tails-you-lose opportunity to lenders at the expense of business owners who were forced by the Government to suspend or curtail their business’s activity.

I also support the aims of Amendments 47 and 48 and hope that the Minister will listen carefully and agree to bring back amendments on Report that address this potential issue.

[Lord German [V]]

My Lords, I, too, support these amendments and have added my name to them. Section 140A of the Consumer Credit Act provides protections for borrowers in loans except where they are regulated mortgages or home purchase matters. The Act protects borrowers in connection with any credit agreement, except those related to home purchases, through court orders which may be awarded where the lender has gone beyond the terms of an agreement, applied the rules inappropriately or otherwise behaved inappropriately. The powers of the courts in this Act are drawn very widely and are designed to ensure that loopholes and lacunas which lenders might use to secure repayment have been covered off.

In their amendments to that Act in this Bill, the Government seek to remove the protections provided by the Consumer Credit Act where bounce-back loans have been provided. The Act provides broad powers to the court to bring lenders into line, including requiring lenders to repay moneys to a borrower, stopping lenders undertaking actions against the borrower in relation to their loan, requiring lenders to set aside any measures the court thinks are inappropriate and enforcing changes on the lender. This Bill, if unamended, would remove those protections in their entirety, except for in two circumstances.

Amendment 46, in the name of my noble friend Lady Bowles, limits the powers of these protections to the strict terms of the bounce-back loan and removes lenders’ ability to weave in other conditions, which the borrower has in respect of other loans and credit facilities, into the bounce-back loan arrangement. Adding such additional conditions is precisely the sort of hurdle which the Consumer Credit Act is designed to avoid—for example, using the terms of an existing loan with the bank to apply to the bounce-back loan, such as the level of security needed, the number of signatories required, the applicability of the borrower and so on. My noble friend has outlined the consequences of enacting this clause in the Business and Planning Bill and, in supporting her, I wish in particular to emphasise the need for Amendment 47.

At Second Reading, I spoke of the problems that many small and medium-sized enterprises are having in securing bounce-back loans with major lenders where hurdles which are not part of the bounce-back scheme are being placed in the way of companies seeking a loan. These loans may not save every company from going out of businesses, but they are certainly going to be a lifeline for some, and let us hope many.

Add to this the difficulties which challenger banks have in being able to find the cash to provide bounce-back loans, in part caused by the reluctance of high street banks to funnel funds through them at the Bank of England’s near 0.1% interest rate, and companies—particularly small and medium-sized enterprises seeking these loans—are facing increased difficulty. The Bank of England’s most recent snapshot of financial conditions in the UK raised particular concerns about the availability of non-bank finance, partly due to tight funding conditions for providers, so with high street banks giving priority to their own customers and the availability of funding making it difficult for challengers to lend, we have factors which make protection of the borrower all the more important. We have to remember that many small and medium-sized enterprises are surviving on a thread.

Covid-19: Local Government Finance

Baroness Altmann Excerpts

Monday 29th June 2020 Lords Chamber

[Lord Greenhalgh]

At the moment, all I can point to is the commitment by the department to ensure that the cost and demand pressures, as well as the income pressures, are covered by a comprehensive plan. In addition to the increase in funding for local authorities, that would obviate the need to change the way that local government is financed for the time being.

[Baroness Altmann (Con) [V]]

My Lords, can my noble friend confirm that the Government will not countenance local authorities becoming bankrupt, particularly in light of the enormous increase in pension deficits that councils will face and the fact that these pension schemes are not covered by the Pension Protection Fund? Members’ pensions would potentially be at risk should there be an insolvency.

[Lord Greenhalgh]

My Lords, there is an absolute commitment to provide support for local councils through this extremely difficult period. My noble friend is right to point out the pressures we face in pension fund deficits, but that was there before the Covid-19 pandemic. Rest assured that there will shortly be an announcement of a comprehensive plan to support all our local authorities through this pandemic.

Social Housing

Baroness Altmann Excerpts

Tuesday 16th June 2020 Lords Chamber

[Lord Greenhalgh]

Noble Lords will not be surprised to hear that I do not agree with that analysis. The sum of £1 billion to the building safety fund is to ensure that more high-rise buildings are remediated, and in particular to provide a recourse for those who cannot use any other means than public money. The provision of £1 billion is an unprecedented sum to discharge that, and of course we are delighted that so many people had already registered with the fund within several weeks of its opening.

[Baroness Altmann (Con) [V]]

My Lords, I welcome the £12 billion expenditure announced for social housing, but can I ask my noble friend whether there are any plans to encourage the use of pension fund assets, including local authority funds, to fund extensive social housing investment, which could ease the pressures on public expenditure?

[Lord Greenhalgh]

My noble friend has made a very good point, which is that we could use the returns from housing in order to increase investment. I shall have to write to her on the specifics of her point, but it should be noted that the removal of the caps on the housing revenue account was done precisely to enable more money to flow into the building of affordable housing.

Covid-19: Planning System

Baroness Altmann Excerpts

Monday 8th June 2020 Lords Chamber

[Lord Greenhalgh]

We note the point that the noble Baroness makes about the importance of access to open spaces. I am sure that it will be taken up by my colleague the Housing and Planning Minister in his planning commission.

[Baroness Altmann (Con) [V]]

I congratulate my noble friend and the Government on their temporary measures to support greener transport options and promote economic recovery. Can he give the House some idea of the Government’s plans to support economic recovery across all our regions, by creating jobs in projects such as onshore wind or community renewable schemes?

[Lord Greenhalgh]

I thank my noble friend for raising this issue. It is important to recognise that over a period of just two months, £27 billion has been provided in funding for local authorities and local areas—a considerable sum. We will continue to look at all measures required to ensure that we reboot the economy after this wretched pandemic.