Renters’ Rights Bill

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Tuesday 6th May 2025 Lords Chamber

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, I will start with government Amendments 136, 138 and 139. These amendments make provision for the requirement to provide a written statement of terms for tenancies that become assured after they have begun. A tenancy may become assured during its lifetime for a range of reasons; for example, because it becomes the tenant’s principal home, or rent becomes payable on the property.

Where this happens, landlords should be able to comply with the requirement to provide a written statement of terms. These amendments will therefore require landlords to provide a written statement of terms within 28 days of the tenancy becoming assured. Without this, landlords would be left in limbo, unable to comply with the duties in new Section 16D of the Housing Act 1988 to provide a written statement of terms at the outset of a tenancy, leaving them liable to penalties. It would also leave a tenant without the written statement of terms, a key benefit of the new system, despite their tenancy having become assured. I beg to move.

[Baroness Thornhill (LD)]

In view of the time that we have lost—and I must say publicly that I regret the pressure that we are putting ourselves under—I will just say that it is essential that written statements are mandated to help people resolve conflicts and provide evidence if disputes go to court. What these must contain, which is the essence of Amendment 140 from the noble Baroness, Lady Scott, is clearly important and needs to be widely known.

There is quite a lot in the Bill that we feel needs to be widely known, and we have all had concerns about the level of knowledge. All I will say, with my tongue in my cheek for things down the road, is that that is all the more reason to regulate those who act for landlords—such as letting agents—to make sure that they act professionally and inform their tenants correctly.

[Baroness Scott of Bybrook (Con)]

My Lords, Clause 14 aims to strengthen the transparency of rental agreements by requiring landlords to provide written terms at the outset of a tenancy. This is a welcome step towards ensuring that tenants are fully informed about their rights and obligations, and that landlords are held to account for the terms they offer.

Amendment 140, in my name, recognises that legislation alone is not enough. We must ensure that tenants, landlords and, indeed, any third-party contractors involved are informed and empowered. By requiring the Secretary of State to issue clear, accessible guidance, we help to make these rights and duties real and usable in practice. Without such guidance, even the most well-intentioned legislation risks becoming an abstract concept rather than a meaningful tool for change. This is why it is crucial that the Government take proactive steps to ensure that everyone involved in the rental process understands their roles and their responsibilities.

Amendments 136, 138 and 139, tabled by the Minister, seek to refine the process through which written statements of terms are provided. The intention, as I understand it, is to ensure that landlords are held to account for providing these terms in a timely manner, which is certainly a step in the right direction. However, we must be careful to consider whether the amendments fully take into account the diverse needs and circumstances of both tenants and landlords.

The Government have a clear opportunity here to provide a system that is not only fair and transparent but also practical and achievable for all those involved. We must ensure that these provisions do not overburden landlords with an administration task but, at the same time, protect the rights of tenants by providing them with the necessary information to make informed decisions about their tenancies. While the intention is to create more transparency, it is equally important, we feel, that we do not add unnecessary complexity or red tape that could inadvertently discourage smaller landlords or make the rental process more cumbersome.

In light of these considerations, I would like to ask the Minister one or two questions. First, is the Minister confident that the 28-day requirement for landlords to provide written statements will not lead to confusion or delays? This timeline, while designed to allow time for landlords to issue the statements, may in practice create gaps in communication, potentially leaving tenants in a state of uncertainty about their rights and obligations. How do the Government intend to mitigate these potential delays?

Furthermore, how do the Government plan to ensure that smaller landlords, who may not have the dedicated administration teams, will be able to comply with these provisions without facing excessive burdens? Small landlords, who often play a crucial role in our rental market, could face challenges in keeping up with increased administration requirements without support or resources. We must be mindful not inadvertently to create barriers that make it harder for these landlords to continue offering tenancies.

In conclusion, while we acknowledge the Government’s intention to improve transparency in tenancy agreements and better protect tenants, we must consider the real-world impact of these changes. We must ensure that reforms are workable for both tenants and landlords, without increasing the complexities of the rental process or creating unnecessary barriers to housing. The amendments, while positive in some respects, do not fully address the practical challenges landlords and tenants face. Is the Minister confident that these provisions will not place undue burdens on landlords, especially those at the smaller end of the market, and that they will effectively protect tenants’ rights without creating new avenues for confusion and non-compliance? The legislation must strike a balance that promotes fairness and transparency while also being workable for all parties involved.

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[Baroness Thornhill (LD)]

My Lords, I have spent some time looking at this and I have listened very carefully to the amendments in this clause from the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson, as well as listening to the words of the noble Lord, Lord Hunt, and the noble Earl, Lord Kinnoull.

I am neither a lawyer nor a solicitor, but we are troubled by Amendment 144 in particular, as it would in effect delete all of the new Section 16I of the Housing Act 1988, inserted by Clause 18. In doing so, it would remove the ability of local housing authorities to issue civil penalties for a range of offences, pushing them into the courts. Having listened to the noble Lord, Lord Hunt, and the noble Earl, Lord Kinnoull, I think that there probably is a debate about what should be pushed back to the courts, but in general I see a legitimate role for local authorities to issue penalty notices. I also feel that in much of the Bill we have talked about the courts’ capacity to deal with things, so I would be a little reluctant to increase the burden on the courts, which we are already arguing are stretched.

I would also be interested in hearing from the noble Baroness, Lady Scott, why Clause 15 of the previous Government’s Renters (Reform) Bill gave similar powers to the local housing authorities as in Clause 17 of this Bill, albeit with a much lower maximum fine. To us, the proposal undermines the regime in the Bill that empowers local housing authorities to issue civil penalty notices. It is part of the tools in the box to give local authorities more powers to enforce across the many and various sections of the Bill. If the one objective of the Bill is to raise standards and root out rogue landlords, the Bill is right to give greater powers to local authorities to do so and raise the level of fines that can be imposed to be an effective deterrent.

At this point, when the noble Lord, Lord Jamieson, very nicely pointed out the one person who has inherited and the this and the that—I do not think that those landlords need to be worried at all about this measure, as they are not the people whom the Bill is aimed at. In fact, there is a tiny degree of scaremongering in this. As I understand the aim, and I am sure that the Minister will correct me if I am wrong, we are looking at the bottom end of the market. The answer to the landlords mentioned in the list cited by the noble Lord, Lord Jamieson, is, “If it is so ruinous to you, don’t do it—don’t do the thing that will result in that fine being imposed”. I am absolutely certain that the majority of good landlords would go nowhere near it—but actually, as the noble Earl said, some of our worst landlords do terrible things. It is very often a shock to talk to the people who deal with bailiffs, evictions and all that, to actually see the conditions that some landlords will subject human beings to. But it is a legitimate argument to talk about what should go to the courts or not as a result of what we have been talking about.

Amendments in this group seeking to reduce the amount that a local authority can charge in civil penalties will be generally resisted by ourselves, precisely because this Bill enables these fines to be used as revenue to provide resources for a strong and effective enforcement service. The capacity and capability of local authorities to carry out positive enforcement is a serious matter—and, of course, we will cover that in the next group. Councils keep the fines that they impose, whereas fines from the courts go to the Treasury, although it must be said that the LGA is still concerned that there will be a funding gap, the amount of which is going to be fairly speculative at this stage, which makes the reasons for wide-ranging reviews, which we will discuss in later groups, to be imperative. Perhaps the Minister could give us some reassurances on funding.

Amendment 144 removes the power of local housing authorities to enforce several provisions in the Bill that we strongly agree with, such as purporting to end a tenancy by serving a notice to quit orally or serving a purported notice of possession—in other words, not using the Section 8 process. In other words, it is conning a tenant that they have to leave. Councils must have the right to enforce this, as it goes to the heart of the Bill.

Amendment 144 therefore reduces the powers of local housing authorities to enforce, and Amendments 146 and 154 go on to reduce the penalties that can be imposed, which we opposed. Amendments 147 and 155, as well as all the amendments from the noble and learned Lords, Lord Etherton and Lord Keen, and the noble Earl, Lord Kinnoull, are an interesting variation on that theme, using rental payment as a measure of the penalty. I can see some logic in that, given that rents vary enormously depending on the property. But two months’ rent in a small house in Lancashire might well be several hundred pounds, whereas a similar property in Hertfordshire might be several thousand. There is a fairness of argument there, which is probably why there is a range of fines the authority can use, and I am sure the noble Baroness will enlighten us.

Finally, we can agree on Amendment 157. The burden on local authorities cannot be understated, and therefore it should be contingent on the Government to specifically look at this aspect and not just rely on the LGA and others to point it out. We are not convinced that it needs to be in the Bill, but it should be a genuine commitment.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson, for moving those amendments. I send my get-well wishes to the noble and learned Lord, Lord Etherton, as well, and thank the noble Lord, Lord Hunt of Wirral, for moving the noble and learned Lord’s amendments. I thank the noble Earl, Lord Kinnoull, and the noble Baroness, Lady Thornhill, for taking part in the debate.

It might help if I start with a brief bit of context. We are taking a clear escalatory approach to civil penalties here. Across the Bill, less serious, one-off breaches will be subject only to the maximum penalty of £7,000. Only if landlords persist in not signing up to the database or the ombudsman will they become liable for a civil penalty of up to £40,000—and that is the maximum. Where landlords continue to fail to remedy unacceptable conditions in a property, they may be faced with a civil penalty of up to £40,000 or indeed criminal prosecution. Where there is evidence that landlords and letting agents continue to discriminate in the letting process, they can face multiple fines. But as the noble Baroness, Lady Thornhill, said, good landlords—there are many of them—will not be subject to any of these fines because they do not commit the offences that would lead to those fines. The answer is to follow the outlines in the Bill and then there will not be any need for landlords to be fined.

Amendment 144 would remove the ability of local authorities to impose financial penalties for non-compliance with the tenancy requirements where this is not a criminal offence. Effective enforcement against landlords who flout the rules is a key part of ensuring that our reforms deliver their full benefits. Across the provisions in the Bill, as I said, we have taken a consistent, proportionate and escalating approach to penalties. The civil penalties of up to £7,000 for less serious or first-time non-compliance is an important part of that approach. Removing the ability of local authorities to impose civil penalties for non-criminal breaches of the tenancy requirement would create a gap. How would landlords who, for example, failed to issue tenants with a written tenancy agreement or ended a tenancy illegally be held to account? Transferring responsibility for determining fines for these breaches to the courts would be a poor alternative and, as mentioned by the noble Baroness, Lady Thornhill, it would unnecessarily increase pressures on the courts. We have had many debates about that in this House in response to other areas in the Bill. In response to the question from the noble Lord, Lord Jamieson, about the capacity of local authorities to deal with this, local authorities have significant experience of imposing civil penalties. I do not see a good reason for excluding breaches of the tenancy requirements from this well-established practice.

Amendments 137, 141, 149 to 151, 156, 158 to 164, 293 and 294 are consequential on Amendment 144 and remove references to new Section 16I of the Housing Act 1988, which Amendment 144 would delete. Amendment 146 would reduce the maximum penalty for a breach of the tenancy requirements from £7,000 to £5,000. Amendment 147 would, in the alternative, set the maximum penalty for a breach of the tenancy requirements at two months’ rent. Amendment 154 would reduce the maximum financial penalty for tenancy offences from £40,000 to £30,000. Amendment 155 would set the maximum penalty for tenancy offences at 12 months’ rent. Amendments 153, 201, 217 and 241 would reduce the maximum civil penalties for offences in relation to tenancy reform, illegal eviction, the database and the ombudsman from £40,000 to £7,000.

Civil penalties need to be set at a level that provides an appropriate punishment and acts as an effective deterrent to future non-compliance. To respond to the question from the noble Lord, Lord Jamieson, about the level of the fines, we have set the maximum civil penalty for offences across the Bill at £40,000. This mirrors existing maximum civil penalties for offences under the Housing Act 2004, which are currently £30,000, but this takes account of inflation since those came into force. We intend also to increase the Housing Act 2004 maximum penalties to £40,000, via regulations, to reflect those changes in the value of money. The £7,000 maximum penalty for breaches represents a similar percentage uprating to reflect inflation, compared with a maximum fine level of £5,000 for less serious non-compliance in other housing legislation; for example, the Tenant Fees Act 2019.

Increasing maximum fine levels to reflect inflation ensures that the deterrent effect of the penalties is maintained. However, I emphasise that these are maximum levels: they will not be the normal penalty level. Local authorities will need to look at the particular circumstances of each instance of non-compliance. They will need to take account of aggravating or mitigating factors and arrive at the final penalty in line with their policy. When considering whether to issue a civil penalty, local authorities are required to issue a notice of intent, allowing time for landlords to make representations. The local authority will need to be satisfied beyond reasonable doubt that the landlord has committed an offence. If the landlord disagrees with the imposition or amount of the penalty, they will of course be able to appeal to the First-tier Tribunal.

Homelessness: Young Adults

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Wednesday 30th April 2025 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

As I said in my initial Answer, we continue to strive to make sure that we offer the best support possible for care leavers. The noble Lord is right to say that they deserve to have that support right through to the age of 25. Earlier this year, we introduced a measure into the DfE’s Children’s Wellbeing and Schools Bill to make sure that no care leaver in scope of corporate parenting duties can be found intentionally homeless. We also made the decision to further strengthen legislation as the Government are all too aware of the long-term impact that pre-care and post-care experiences can have on young people. It is essential, as part of local authorities’ role as corporate parents, that this vulnerability is recognised and that care leavers are provided with the care, stability and support they need to build a secure and successful future.

[Baroness Thornhill (LD)]

My Lords, providers of support and housing for this vulnerable group need two things: funding from Homes England and accreditation from Ofsted. In a recent meeting with the YMCA, for Hertfordshire this time, I was told that all its development plans were on hold because of the lack of any announcement about any new funding streams from Homes England, leaving the sector completely in limbo. Can the Minister tell us why this is? In addition, it has been waiting since October 1923 to get Ofsted accreditation for a unit for 40 such vulnerable children.

[Baroness Thornhill (LD)]

Okay—a long time. Will the Minister please agree to look into this logjam and see whether she can be Dyno-Rod?

[Baroness Taylor of Stevenage (Lab)]

I am always happy to be Dyno-Rod, even when it goes back to 1923. I am not sure which programme the YMCA applied to, but at the Spring Statement we announced an immediate injection of £2 billion to support the delivery of the big boost in social and affordable housebuilding that is necessary. As the noble Lord, Lord Austin, asked me to have a meeting with the YMCA, I think it would be very helpful to meet it and find out what it has experienced with this blockage to its funding. I hope we can do the Dyno-Rod job and get that freed up as quickly as possible.

Renters’ Rights Bill

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Monday 28th April 2025 Lords Chamber

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, I thank the noble Baronesses, Lady Scott and Lady Thornhill, the noble Lord, Lord Young of Cookham, and the noble and learned Lord, Lord Etherton, for their amendments, and I thank the noble Lords Cromwell, Lord Empey, Lord Wolfson and Lord Northbrook, the noble Baroness, Lady Grender, and the noble Earl, Lord Kinnoull, for their comments and for bringing the noble and learned Lord’s amendments before us.

I understand the concerns that Members have on this issue, which is why we engaged early on with noble Lords in advance of the Bill coming before this House. We have listened to noble Lords’ views and experience in this area. I appreciate that we may need to have further discussions.

I say to the noble Baroness, Lady Scott, that I started working with noble Lords on the Bill some months ago to understand the concerns that they had. Where probing amendments have been tabled, I have attempted to answer in detail. On matters requiring factual answers, such as data that I did not have at my fingertips, I have responded either in writing and/or offered further meetings to noble Lords.

However, it was too late in the day when the party opposite recognised the dreadful housing crisis that it had led us into, which meant it was too late for it to finish legislation to deal with it. Today, we are faced with amendments seeking to remove core principles of the Bill that is trying to deal with it. If those come before us, I will have no option but to disagree with them. Some of those core principles were in the Bill of the party opposite when that sat before this House. This Government will take up the challenge of dealing with the issues with a degree of balance between landlords and renters and, I believe, will do a better job of it.

The amendments before the Committee today would all require the Government to make an assessment of the justice system as a result of these reforms and, in some cases, delay commencement of the reforms until certain conditions were fulfilled. Amendment 69, in the name of the noble Baroness, Lady Scott, would require the Lord Chancellor to prepare an assessment of the operation of the process by which a county court is able to make possession orders for rented properties, and how such orders are enforced. That assessment will be published at such a such a time and in such a manner as the Lord Chancellor sees fit. The noble Baroness, Lady Scott, has also tabled Amendment 283, which, if made, would delay the commencement of these important reforms until the Lord Chancellor had carried out and published the proposed assessment and was satisfied that the court service had sufficient capacity.

The Government’s view is that the implementation of our tenancy reforms should not, as the noble Baroness, Lady Thornhill said, be held back by an assessment of current working, especially one that is so broad and undefined. We have no intention of delaying these urgent reforms while we wait for an unnecessary assessment of the existing possession process. The proposed assessment will provide no new insight or benefit to interested parties. Compelling the courts and tribunals to undertake such an assessment would detract from their vital work to make sure that the courts are ready for our reforms.

Quarterly data on the operation of the court possession process for rented properties is already, and will continue to be, published by the Ministry of Justice. This is regularly reported and scrutinised. The published statistics include both the volumes and timeliness of possession orders and the enforcement of those orders. Court rules specify that possession claims requiring a hearing should be listed within four to eight weeks of the claim being issued. Landlord possession claims are taking an average of eight weeks—not seven months, as quoted by the noble Lord, Lord Northbrook—to progress from the issue of a claim to a possession order in the most recent quarter from October to December 2024.

Instead of publishing this unnecessary assessment, we will carry out our tenancy reforms as quickly as possible. I want to reassure the Committee that we are fully focused on making sure that the justice system is prepared for the changes to court caseload and procedures which will be required for our reforms. We are working with the Ministry of Justice and HM Courts & Tribunals Service to that effect. This includes investing in additional court and tribunal capacity to handle any extra hearings generated. I hope that answers the point from the noble Lord, Lord Wolfson. I therefore ask that those amendments are not pressed.

Amendment 205 in the name of the noble Lord, Lord Young of Cookham, would require the Secretary of State to lay a Statement before Parliament setting out how the Government will ensure that the county courts are prepared for the impact of the Renters’ Rights Bill on possession cases. The Statement would need to be made within six months of the Bill being passed and assess the effect of the Bill on the volume of cases, the efficiency and timeliness of judicial proceedings, and the resource requirements of the courts in future.

As I have said, I fully recognise noble Lords’ concerns that this Bill will impose an additional burden on the justice system and understand the concern of my honourable friend at the other end of the building about the court system. As already noted, I reassure the Committee that we are fully focused on making sure that the justice system is prepared for changes to court caseload and procedures which will be required for our reforms and we are working with the MoJ and HMCTS to that effect.

To pick up the point from the noble Lord, Lord Young, about resources, we are working together to agree how these reforms are implemented. This will include ensuring that the county court will have the capacity and resources it needs to adjust to any changes in possession caseloads—which will, of course, involve the assessment that the noble Lord, Lord Northbrook, referred to—and commitments to address the resources needed. Work is also progressing on updating rules and procedures in readiness for the implementation of the new legislation.

In the longer term, we expect our reforms to reduce the volume of court possession claims, as only those cases where there is a clear, well-evidenced ground for possession will be able to proceed. This will help offset any increased pressure on the courts resulting from our reforms in due course.

His Majesty’s Courts & Tribunals Service is building an end-to-end digital service for resolving all possession claims in the county courts in England and Wales, to make processes more efficient and easier to understand for landlords and tenants—a much-needed reform. Funding has been agreed and provided to enable the design and build of this new service, which is well under way and builds on the existing digitisation of the justice system.

The noble Lord, Lord Cromwell, said it had left him with the impression that this was five years away. That is not what the court service said and not my understanding of where we are with it. As I have explained, this is not a new system that is being built from scratch; it is a further module of an existing system.

The noble Earl, Lord Kinnoull, commented on the outlining of the size of the problem that our colleagues from HMCTS set out. That was the hold system that they are developing, with the approach to design and build being at prototype stage. I understand what he is saying, but the digitisation process is not the whole picture of what we are doing with our colleagues in the courts service. This service will offer an online route for making and responding to possession claims, filing documents and receiving updates and outcomes, offering improved user experience through guided journeys.

As we have heard, some noble Lords heard first-hand about the progress being made. The noble Earl, Lord Kinnoull, said that the question was put, “How long will this take?” and colleagues replied, as I understand it, “Two years from March”. I thank him for those comments, but that is not the totality of the work we are doing with the courts service, so, while progress on that is really important to driving this forward for the future, we will be working with our friends in the courts service and supporting them in the interim. I therefore ask him not to press his amendment.

I reiterate my thanks to the noble Baroness, Lady Thornhill, for Amendment 264, which would require the Secretary of State to publish a review of the impacts on the judicial system arising from the Renters’ Rights Bill within two years of the legislation being passed. The review would need to consider the effect of the Bill on the volume of cases, the efficiency and timeliness of judicial proceedings and the resource and administrative burdens on the courts.

As I already outlined, I want to reassure the Committee that we are fully focused on making sure that the justice system is prepared for changes to court caseloads and procedures. We are taking that issue very seriously. We will monitor the effects of these reforms on the justice system by closely engaging with the sector and analysing the comprehensive data that is already collected. It is not that we do not think it is necessary to analyse the data; it is more that we think committing to a formal review on the face of the Bill is unnecessary.

The points the noble Baroness made about justice delayed being justice denied are quite right. That is why we do not want to delay all this, including abolishing the Section 21 evictions that have caused so many problems. We want to do that as quickly as possible, but I want her to be assured that we believe that analysis of the impact of the Bill on the system is critical and important, and we will be doing that using the information that is already available.

[Baroness Thornhill (LD)]

I thank the Minister for giving way. Does that mean, as I take from her words, that such monitoring and review will be an ongoing and rolling process from day one?

[Baroness Taylor of Stevenage (Lab)]

That is completely correct. We need to make sure we are taking account of the impact on the system from the start. We believe that over time it will reduce the volume of cases going to the court service. As the noble Baroness, Lady Grender, pointed out, not many cases end up in the courts system, but there are some that go down that route. We will be monitoring them from the outset.

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[Baroness Thornhill (LD)]

My Lords, we have several groups of amendments that talk about rent, money and finances, so before commenting specifically on this amendment, I want to have a little rant regarding landlord finances. The narrative is that the majority of landlords are in a terrible financial position. What evidence do we actually have for that? It is certainly not borne out by my anecdotal evidence and could be conceived as scaremongering, because my understanding is that being a landlord is, and will remain, profitable.

The idea that, to remain sustainable, landlords must be able to pass the entirety of any increased business cost and risk on to the tenant through a rent increase is, frankly, ridiculous. There is no other business model that operates in this way, and it does not add up when we look at the sum of the data that we have. The English Private Landlord Survey said that the median income of landlords, including rental properties, is around £52,000. According to the Shelter/YouGov survey of private landlords, rental income is largely additional for landlords: 50% of landlords say that they do not rely on rental income to cover living expenses.

I note that in any investments that I have made, there is a very cleverly worded phrase at the bottom: “Investments can go down as well as up”—except if you are a landlord, it would seem; even more so as you are left with a capital asset that, in this country, largely increases in value. That is my rant. If the noble Baroness, Lady Jones of Moulsecoomb, were in her place, she would probably be quite proud of me for it.

I turn to the amendments in this group tabled by the noble Baroness, Lady Scott, regarding notice periods for rent increases. When the Bill was introduced in the Commons it proposed a standard one-month period. The Government’s decision to extend this to two months represents a welcome improvement that better balances the interests of landlords and tenants. This evolution demonstrates a willingness to listen and to respond to concerns about tenant security, for which I sincerely thank the Minister and her team.

Amendment 73 seeks to revert the notice period to just one month and Amendment 81 questions the differential treatment between standard and low-cost tenancies. These amendments, particularly Amendment 81, raise fair questions, which I too would like an answer to, as I have not been able to find a reason for that differentiation. A two-month notice period for rent increases represents a reasonable middle ground that acknowledges landlords’ legitimate need to adjust rents while giving tenants adequate time to prepare financially.

For many working families, a rent increase actually requires careful budgeting. I have not got the figures to hand but we know that a significant number—into the many thousands—of moves and evictions last year were due to the inability of the tenant to pay the new rent rise. One month is simply inefficient to work a decision to relocate and make those adjustments.

I commend the Government for finding a balanced approach. This middle ground solution may not be perfect from any single perspective, but it demonstrates what good legislation can achieve when all voices are genuinely heard during the parliamentary process. With these factors in mind, I look forward to the Minister’s response.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness, Lady Scott, for her amendments relating to notice periods for rent increases, and the noble Lord, Lord Jamieson, for moving Amendment 72.

I thank the noble Lord, Lord Marlesford, for his comments about the balance between landlord and tenant. We are aiming to get that balance in this Bill. He is right to point to the ratio of rent to income, but that is why tenants need longer to consider the impact on their family budget. Increasingly, the proportion of income that is taken up by rent is going up and up, particularly in certain parts of the country, making it very difficult for tenants to manage increases at short notice and without adequate notice to plan their family budgets.

The noble Lord, Lord Jamieson, talked about consultation with landlords on the impact of rent increases. Because of a question during the debate on a previous day, I undertook to give a written response on the consultation that has been carried out before and during the course of this Bill. I will provide that response in writing to noble Lords; it is being prepared at the moment, and I will get back to them with a summary of that.

I thank the noble Baroness, Lady Thornhill, for her comments. She is quite right to refer to issues of rental income and capital assets. As I have said many times, we must make this fair for everybody, and make sure that everybody gets what they want. Landlords want a tenant who will look after the property and pay their rent, and tenants want a landlord who will make sure the property is available, looked after and in good condition—that is what we are all after.

Amendment 72 would reduce the amount of notice of a rent increase that a landlord will have to give a tenant from two months to a period equal to a rental period. For example, where the rent is paid monthly, this would reduce the notice period from two months to one month. I appreciate, as the noble Lord, Lord Jamieson, said, that these are probing amendments.

Together with Amendment 72, Amendment 74 would remove the requirement for landlords to serve a rent increase notice two months before the rent increase comes into effect. We do not agree with this position. The Renters’ Rights Bill will deliver our manifesto commitment to empower private rented sector tenants to challenge unreasonable rent increases. This includes by requiring landlords to give two months’ notice of a change, rather than one. This was, as the noble Baroness, Lady Thornhill, pointed out, the result of debates in the other place and of lobbying from a number of groups that have been speaking to us. This will ensure that tenants who may struggle to pay a rent increase will have time to consider their options, seek advice and, where necessary, take steps to challenge the rent increase at a tribunal.

Receiving a rent increase can be distressing for many tenants. We want to give tenants time to reassess their budgets and consider their options. It is unfortunate that the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson, do not agree that tenants should have this protection.

Amendment 73 seeks to decrease in the Bill the notice period for a landlord to serve a rent increase from two months to one month. Similarly to Amendment 72, we do not agree with this position. A two-month notice period will give tenants time to review their budgets before the rent increase takes effect and to take advice, if necessary or appropriate, from advice agencies such as Citizens Advice.

It is regrettable that the Opposition have tabled this amendment, because they supported this position on the matter. Their original White Paper, in 2022, promised to

“increase the minimum notice landlords must provide of any change in rent to two months”.

It is disappointing that they have changed their minds on this, and now wish for tenants to have less time to consider their options when receiving a rent increase.

Amendment 81 seeks to increase from one month to two months the amount of notice of a rent increase that landlords of relevant low-cost tenancies need to provide. Social landlords that fall under a new definition of a relevant low-cost tenancy in the Bill will be exempted from most of the changes the Bill makes to rent increases. This means that landlords of relevant low-cost tenancies will be permitted to increase the rent via the Section 13 process at any point in the first 52 weeks of a tenancy, and then once every 52 weeks thereafter, and must give at least one month’s notice. The new amount may take effect after this notice period if it is not challenged by the tenant in the tribunal. These landlords will still be able to use review clauses within a tenancy to increase the rent, as they can at present.

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[Baroness Thornhill (LD)]

I had thought that there would be a few more speakers than that, but hey.

I wish I could be half as certain about what is going to happen in the future as some noble Lords here—they must have a crystal ball hidden somewhere. I feel this Bill is almost an act of faith. It is quite obvious that we believe that it is going to do good things and that Armageddon will not happen. However, the noble Baroness, Lady Scott, argued her case very well and sincerely, and likewise she believes that. At the moment, neither side really knows what is going to happen. To use the cliché: only time will tell.

The problem with so many amendments being regrouped is that we are into groundhog day, so I will be brief. As previously stated, we do not support amendments that would disincentivise tenants challenging rent rises and feel that most of these amendments fall into that category. The Bill is about a power balance between the tenant and the landlord, and is a genuine attempt to redress that balance. A lot of the amendments and statements made by some noble Lords want to maintain the status quo; for us on these Benches, that is an imbalance. We are just going to have to disagree about that.

The noble Baroness referred to the realities of the housing market. Our interpretation is that landlords can charge whatever they want—whatever the market will sustain—and we do not believe that that is right. In doing so, I genuinely believe we are creating an underclass of people who will never be able to fit into the private rented sector. That is perhaps an argument for another day.

The Minister has perhaps already answered Amendment 105, but I am quite happy to hear it again, given that I agree with the noble Baroness that such a review is important and necessary.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness, Lady Scott, for her amendments on rent regulation. I thank the noble Lord, Lord Howard, and the noble Baroness, Lady Thornhill, for their comments.

As I set out earlier, the Bill will empower private rented sector tenants to challenge unreasonable rent amounts. This is a central aim of the Government’s reform agenda and reflects our manifesto commitment. The tribunal will not be able to increase rent beyond what the landlord initially proposed. This will prevent unscrupulous landlords—let us face it, most of them are good, but there are some unscrupulous ones—using rent increases as a back door means of eviction, while ensuring rents can be increased to reflect market rates.

We are clear that tenants should submit an application to the tribunal only where they believe a rent increase is above market rates. In the first instance, we strongly encourage landlords and tenants to communicate early about what adjustments to rent are sustainable for both parties. We need to think about possible triage arrangements if there is no agreement between them.

We anticipate that our reforms will lead to some increases in cases, but, as I have already stated, we are working closely with the judiciary to ensure the tribunal has the capacity to deal with cases. In the First-tier Tribunal (Property Chamber), work is progressing to increase capacity, as well as on reviewing resourcing and working practices in readiness for any increase in demand. I am not sure if it will be 1 million applications, as the noble Lord, Lord Howard, said, but we anticipate that there will be some increase initially, until the way that this works drives down demand in the future—which I think it will. This is part of our wider work to make sure the justice system is prepared for the changes to case loads and procedures which will be required for our reforms.

As now, tenants will be able to challenge the rent payable in the first six months of a tenancy if it is above market rate at the First-tier Tribunal. The tribunal can determine the open market rent only to be lower than or the same as the tenancy rent itself. The tribunal will not be able to increase the rent above the amount originally proposed by the landlord. We see this as a rebalancing mechanism, as the noble Baroness, Lady Thornhill, said.

Amendment 92 seeks to allow the tribunal to determine the open market rent to be higher than that originally proposed by the landlord. We believe that limiting the tribunal to determine a rent to be either the same as the landlord themselves proposes or an amount lower than this is fair to both parties. If landlords have agreed a rent that they consider to be acceptable at the beginning of the tenancy, they should have no fear of a challenge at tribunal.

I turn to Amendment 93. This Bill enables a tenant during the first six months of a tenancy to challenge the rent payable. It is an important provision that should stop a minority of unscrupulous landlords exploiting tenants desperate to find a new home. It strengthens our ban on rental bidding, ensuring that any landlords who seek to charge over the odds can be challenged. When a tenant challenges their rent, the Bill states that the start date of the new rent determined by the tribunal

“must not be earlier than the date of the application”.

This reflects Section 22 of the Housing Act 1988, where a similar provision already exists to allow backdating of a determination where a tenant has challenged an excessive rent.

Amendment 93 would prevent a tribunal backdating the determination of the new rent payable to the date of the tenant’s application. It would mean that the new rent could take effect only from the date of the tribunal’s determination. I understand that the purpose of this is to ensure that the landlord will not have to repay the difference in rents back to the tenant. The Government encourage landlords and tenants to communicate early about what rents are sustainable for both parties. The Bill levels the playing field to enable a more equitable discussion about levels of rent before anything comes to the tribunal. To be clear, the aim of this is to prevent as many cases as possible ending up in court action.

In our view, the noble Baroness’s amendment would limit the ability of tenants in the first six months of an above-market tenancy to get justice for the period that the case is in the courts. It would also increase the risk that landlords would seek to exploit desperate tenants by extracting above-market rents. I am really concerned about that, because one of the key principles of the Bill is to stop that happening.

--- Later in debate ---

[Baroness Thornhill (LD)]

My Lords, most of the amendments in this group are disagreeing with the Government’s ban on being able to ask for rent in advance, and all basically say the same thing. While I am very supportive of the Government’s aims, there are legitimate questions to be answered in this area. By preventing tenants paying rent up front, will the Government potentially reduce the housing options available to financially vulnerable people? So says the letting and landlords’ association. Is it a way to crack down on discrimination against low-income renters by unscrupulous landlords? So say the Government and the lobby groups for renters.

Amendments 108 and 111, which would allow up to six months’ rent in advance or even 12 months, are troubling. Rogue landlords could pressure vulnerable tenants to mutually agree to these excessive payments, circumventing the very protections that the Bill seeks to establish. Furthermore, Amendment 112’s provision for tenants to specifically request such arrangements in writing could easily be manipulated. Landlords might simply make such requests a condition of securing the property, forcing tenants to choose between signing or losing their housing opportunity.

However, what we do know is that people on fixed incomes, such as pensioners, those with lower incomes, the self-employed, the overseas students, those with a bad credit history, those who fail referencing checks and those with no family member to act as a guarantor will all have challenges passing referencing and affordability checks. They are the risky renters. The Government’s amendments are clearly designed to protect these financially vulnerable people from exploitation, but the big question is: how will agents and landlords manage tenancy risk in the future? Tenancy risk is a reality. With over 20 tenants chasing each vacancy, landlords will, legitimately and legally, be able to pick the person who represents the lowest risk. The bottom line for them is economic reality. Your Lordships have all heard my views, but even I would say, “Who can blame them?”

There are many thousands in these various groups. How do the Government think that they will get housing in the future? How will landlords mitigate the risk of tenants who fail references and have no renting history in the UK or who have CCJs against their name? Millions of people fall into these categories. My deepest worry is that the rent in advance system will go underground and people will be asked to stuff cash into brown envelopes, while rental payments will be edited to make it seem that all is well. Desperate renters will do desperate things to put a roof over their heads. I hope that I am wrong and not being unduly harsh on landlords or tenants. It seems to me that such people are left with the sole option of a professional rent guarantor service. What else is there? I am quite sceptical of local authorities stepping into that role, although they do much already to make tenancies survive and to help tenants.

What are the Government doing to ensure that those services can operate legally and responsibly, and to help this group of people? Are they part of the solution? I look forward to the noble Baroness’s answers.

Finally, to reiterate the point, a market that is significantly undersupplied and where the market rules of supply and demand result in continually rising rents, impacting most on precisely this large group of risky renters, has already resulted in a whole cohort of renters who are forced into homelessness and overpriced temporary accommodation. These are the very people who would in the past have been in social housing, of which there is, as we know, a huge shortage. The free market, under the rules as they are now, has led us to this place—a broken system—and there is no one denying that. Continuing as we have thus far can lead only to more of the same.

The Bill is a brave attempt to recognise the current imbalance between tenant and landlord, but if we do what we always do, we will get what we always get, and that is not acceptable.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness, Lady Scott, and the noble Lords, Lord Jamieson, Lord Truscott and Lord Hacking, for their amendments in relation to rent in advance, and the noble Lord, Lord de Clifford, and the noble Baroness, Lady Thornhill, for commenting on these amendments.

Taken together, Amendments 108 to 110 and 112 tabled by the noble Baroness, Lady Scott, would allow landlords or agents to charge rent in advance when this has been mutually agreed with the tenants in a tenancy agreement. This Government are clear that the practice of landlords or agents charging rent in advance is unfair. Many of us will have heard the stories, many of them of requests for large amounts of rent in advance that have pushed families into financial hardship or locked some out of the sector completely. In other cases, unscrupulous landlords use rent in advance to pit prospective tenants against each other and create these dreadful bidding wars to help people secure a property. That is why the Bill will prohibit a landlord or letting agent requiring or accepting any payment of rent before a tenancy has been entered into. In addition, a landlord will be able to require only up to one month’s rent in advance in the window between a tenancy being entered into and that tenancy beginning.

I want to be crystal clear on this point: once a tenancy has begun, tenants will remain free to pay their rent prior to the agreed due date should they wish to do so, although landlords will not be able to require this and any attempt to require it will be challengeable by the tenant.

Amendment 108 would allow landlords to include terms in a tenancy agreement that require rent in advance to be paid up to six months before it is due. It is the view of the Government that this amendment would fail to protect tenants from exploitative rent in advance practices. Landlords, being able to require up to six months’ rent in advance when this is agreed in a tenancy agreement, could, in a market where properties are hotly contested, push tenants into agreements that stretch their finances to breaking point to secure a tenancy.

Amendment 109 would limit rent in advance to four months when agreed in a tenancy agreement. This has the same effect, with the potential for tenants in hotly contested markets to feel compelled to agree to terms that require significant financial outlay. Even the limit of two months, as the noble Baroness, Lady Scott, proposes in Amendment 110, in our view does not go far enough to protect tenants. In a scenario where a landlord can request two months’ rent in advance, this is still a significant financial expectation of a tenant. Given that the tenant will also likely be required to pay a five-week tenancy deposit, they could face being asked to stump up more than three months’ rent to access a property.

Renters’ Rights Bill

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Tuesday 22nd April 2025 Lords Chamber

[Baroness Thornhill (LD)]

I apologise for interrupting the noble Baroness earlier; she was on my blind side. She mentioned those of us who have been involved in local government. Well, I had the pleasure, I would say, of being in a beacon council under the Blair Government when the now noble Baroness, Lady Casey, was actually doing all the work with the then Labour Government on anti-social behaviour. We recognised that it was a serious issue on many of our estates—and a deeply challenging one at that. I would argue that councils are not necessarily restricted in what they can do, but it is very challenging. It is difficult, and we often found that the courts were very sympathetic to tenants while we were sitting there going, “But you don’t have to live next door to them”.

Very often, another issue that occurred was that neighbours, after months of ongoing, low-level, constant nuisance, retaliated in some way. Such incidents were then reduced to being 50/50, when in actual fact you had only to speak to the people around the neighbourhood to know that that was not the case. These things are difficult to prove and difficult to get evidence on. People do not always write the dates down—“Oh, please keep a diary”—you know. Sometimes, even that is quite difficult for people. This is an area, Minister, where we would like to explore more what the route is for proving and what the bar is, what the level is, that has to be satisfied.

I must admit that I did not read into the Bill that it was that much of a restriction or a difficulty, but perhaps I have missed something. The National Housing Federation certainly has not listed it as one of its key concerns. That, in itself, perhaps tells me how much of an issue it is, but I would support the noble Baroness if that proved to be the case. As I say, I know from very bitter experience just how difficult this area is, and it is most likely to be the one that would come up most in certain areas.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, I thank the noble Baroness, Lady Scott, for her amendments relating to anti-social behaviour, and I agree with her powerful statement on ASB. As a councillor, I saw at first hand, as the noble Baronesses, Lady Thornhill and Lady Eaton, did, the utter misery that is caused to individuals and communities through the irresponsible actions of others and I properly understand why it is important that we have provisions to tackle it.

Amendment 14 seeks to reintroduce social landlords’ ability to apply for a demotion order in response to the anti-social behaviour of a tenant. This amendment seeks to enable landlords to demote social tenants to a less secure form of tenancy because of anti-social behaviour. However, the amendment as drafted would not work; the Renters’ Rights Bill will move tenants to a simpler tenancy structure where assured shorthold tenancies and the ability to evict shorthold tenants via Section 21 are abolished. There will therefore no longer be a tenancy with lower security to demote tenants to. To work, it would require a reversal of measures in the Bill to remove demoted tenancies and assured shorthold tenancies; that is the issue with the amendment as drafted.

I reassure the noble Baroness that tackling anti-social behaviour is a top priority for our Government and a key part of our safer streets mission. The Bill will shorten the notice period for the existing mandatory eviction ground, with landlords being able to make a claim to the court immediately in cases of anti-social behaviour. In addition, the Bill amends the matters that judges must consider when deciding whether to award possession under the discretionary ground. This will ensure that judges give particular regard to whether tenants have engaged with efforts to resolve their behaviour and the impact on other tenants within HMOs.

As well as the positive changes that the Bill makes towards tackling anti-social behaviour within the rental sector, we will crack down on those making neighbourhoods feel unsafe and unwelcoming by introducing the new respect order, which local authorities will be able to apply for and which will carry tough sanctions and penalties for persistent adult offenders. Together, those changes will ensure that the needs of victims are at the heart of our response to anti-social behaviour—that is what is important. Too often victims have felt that the power is all on the side of those who are committing the anti-social behaviour and not on the side of victims—that cannot carry on.

In response to the comments from the noble Baroness, Lady Eaton, about local authority housing tenants, the Bill introduces reforms to the assured tenancies framework, which applies to both the private rented sector and private registered providers of social housing. Local authority tenants are provided secure tenancies under a different tenancy regime. The vast majority of local authority tenants are secure lifetime tenants, and therefore they already enjoy a high security of tenure. Local authority landlords also have existing powers to tackle ASB, including eviction grounds similar to those in the Bill.

The point is taken from the noble Baroness, Lady Thornhill, about the further information about evidence and where the bar is going to be set; I will take that back to the team and come back to her. For these reasons, we feel this amendment is not needed and kindly ask that the noble Baroness withdraws it.

I turn to Amendment 66, which seeks to remove the requirement imposed upon judges, which has been introduced by the Bill, to give a particular consideration to whether a tenant, against whom a possession order is sought under ground 14 for anti-social behaviour, has engaged with attempts by the landlord to resolve the behaviour. We believe this change represents the wrong approach, for two reasons.

First, the Government believe that landlords should attempt to resolve problematic behaviour issues with tenants before attempting to evict them. By directing courts to particularly consider whether a tenant is engaged with these efforts, landlords will be incentivised to make them. Secondly, it is right that the court should give particular consideration to whether a tenant has engaged with attempts to resolve the behaviour so that courts may be more likely to evict a tenant who has, for example, been obstructive throughout the process. Where a tenant has shown willingness to engage constructively with the landlord, it is right that the court considers this factor, and it is for those reasons that we introduced the requirement.

I turn to Amendment 67, also tabled by the noble Baroness, Lady Scott, which seeks to expand the factors that a court is specifically directed to consider when deciding whether to make an order for possession against a tenant in a house in multiple occupancy for anti-social behaviour under ground 14. Currently, courts will be directed to give particular consideration to the past impact of the tenant’s behaviour on their fellow HMO tenants. This is in recognition of the increased impact that anti-social behaviour can have when victims have to share facilities and live in close proximity with the perpetrator, as the noble Baroness mentioned. Judges will also consider all factors relevant to the case and will already be directed generally to have consideration of the future and ongoing impact of that behaviour. As such, we do not think this amendment is strictly necessary to achieve the intended effect, although we are very grateful to the noble Baroness for flagging up that point.

Local Authorities: Temporary Accommodation Costs

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Tuesday 22nd April 2025 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

The noble Lord is quite right to highlight the importance of attracting funding into housing. I recently attended a session in the City to encourage that, and there was a lot of interest in investing in the housing sector. We are also determined to restore order to the asylum system so that it operates fairly and properly, and we recognise the importance of a smooth transition out of asylum support accommodation for individuals granted refugee status. We are working with the Home Office to ensure that those individuals can successfully integrate into local communities.

[Baroness Thornhill (LD)]

My Lords, the Minister mentioned a welcome increase to the homelessness prevention grant. However, does she agree with the latest statistics from the District Councils’ Network that the Government’s new formula for allocating that grant has meant that some of the councils worst hit by homelessness will lose up to 39% of their homelessness prevention grant? Will the Minister commit to looking at those cases individually and reviewing the formula to ensure that it does not reduce for those areas experiencing the greatest challenges?

[Baroness Taylor of Stevenage (Lab)]

The noble Baroness referred to the homelessness prevention grant. The overall increase to that fund—the largest since the grant began—is important. It will be allocated to all local authorities in England based on their homelessness pressures. I will talk to the District Councils’ Network to see what it has found, because the grant is supposed to be allocated to meet the homelessness pressures of individual local authorities.

Town and Country Planning (Fees for Applications, Deemed Applications, Requests and Site Visits) (England) (Amendment and Transitional Provision) Regulations 2025

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Monday 3rd March 2025 Grand Committee

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, the Town and Country Planning (Fees for Applications, Deemed Applications, Requests and Site Visits) (England) (Amendment and Transitional Provision) Regulations 2025 were laid before the House on 13 January 2025. These draft regulations increase planning fees for householder and other applications. This will provide essential extra funds to local planning authorities and improve the efficiency of our planning system. This is vital to speed up decision-making and support the Government’s plan of building 1.5 million homes and delivering economic growth.

I will start by providing some context and background to these regulations. Currently, the income from planning fees does not cover the cost to local planning authorities of determining applications. Overall, there is a national funding shortfall of approximately £362 million, the burden of which is borne by the general taxpayer. By increasing fees for applications with the greatest funding shortfalls, we can cover a greater proportion of the costs associated with processing these applications.

It is estimated that these fee increases will generate an additional £56 million annually for local planning authorities. This is a substantial sum that will significantly enhance the capacity and efficiency of our planning services.

We consulted on proposals to increase fees in July 2024. Respondents were generally supportive of our proposals, recognising the need to boost the funds available to local planning authorities, if this leads to improvements in planning performance. Noble Lords will realise that the Local Government Association has long campaigned for increases in planning fees.

I now turn to the detail of the regulations. First, they increase the fees for householders who want to enlarge, extend or alter their home from £258 to £528 for a single house and from £509 to £1,043 for more than one house. I recognise that some may consider that, during times of economic pressures for householders, we should not be increasing planning fees. However, in light of the clear funding shortfall that exists, it is right that applicants should contribute more towards the costs incurred by local planning authorities in delivering a planning service, rather than the taxpayer funding it.

We estimate that, in most cases, the cost of the planning application is less than 1% of overall development costs. Furthermore, some householder development can already be undertaken through permitted development rights and so would not be subject to a planning application fee.

The regulations also increase fees for a range of other application types, which currently are set too low. They increase the planning fees for prior approval applications from a flat fee of £120 to £240 and from £258 to £516 where they include building operations, and for the change of use of commercial buildings to residential uses from £125 per dwelling to £250 per dwelling. The regulations also increase the fees for discharge of conditions from £43 to £86 for householders and from £145 to £298 for all other applications, including discharge of biodiversity gain plans.

Finally, the regulations introduce a new three-tiered fee structure for Section 73 applications that are used to vary or remove conditions on planning applications. This reflects the higher costs associated with Section 73 applications on major developments. The regulations also make corrections to two fees that were erroneously set too low when the fee regulations were last amended in 2023. These regulations do not impose a fee on listed building consents, which continue to incur no fee.

I want to be clear that the Government expect local planning authorities to use the income from planning fees on their planning application service, so that they can build up their capability and capacity and improve performance. We know that this is what applicants expect in return for paying higher fees. In addition to these fee increases, the Government have committed to a £46 million package to enhance the capacity and capability of local planning officers. This includes recruiting 300 additional planners. I recognise that there is no planning officer tree where we can go and pick them; this is going to take a little time.

The Government have also announced their intention to introduce a measure in the planning and infrastructure Bill that will enable local planning authorities to set their own planning fees to meet their costs. This comprehensive approach ensures that local planning authorities are not only better funded but better equipped to handle the demands placed on them.

To summarise, while we take forward our measures for local fee setting, these regulations will provide local planning authorities with an immediate boost in resourcing. This will enable local planning authorities to budget with more confidence and be better equipped to deliver the housing and growth that our country needs. I hope that noble Lords will join me in supporting the draft regulations, which I commend to the Committee.

[Baroness Thornhill (LD)]

My Lords, the Liberal Democrats wholeheartedly support this rise in planning fees, so I apologise now for repeating some of the very good points that the Minister made. She should not expect me to keep saying that for ever, but I do on this occasion.

We have all known for years that planning departments are underfunded; they are not covering their costs, and the position is simply unsustainable. I am interested that the Government have decided to go for an interim position rather than a full cost recovery. I can kind of understand their wanting it to be balanced, but I wonder whether the work has been done on what will be needed to get to that position, which we believe we should get to.

As the Minister said, planning departments have long been subsidised by the taxpayer through council tax; they have been bearing the burden of the costs of planning applications, which do not directly benefit them—particularly for individual householder applications. It seems completely illogical that everyone should contribute to an individual’s home improvements, which usually add value to just their property.

We welcome the change of emphasis from the last Government, who did at least increase the fees in December 2023—but I always felt that their agenda seemed to be to keep fees down. I note that a Conservative Member of Parliament in the other place described the rise as “eye-watering”. My riposte is that he clearly does not know what builders are charging these days, as the planning fee, which is an essential tool to getting the development right, is but a tiny fraction of the total cost. Two friends have recently had extensions to their homes, and when I hear how much they spent on the projects as a whole, I feel that £528 is probably the lowest in the grand scheme of their costs.

Major housebuilders are demonstrably making money, and their applications take the most time and expertise, so a rise to begin to cover costs seems entirely reasonable—more so given the financial challenges that local government faces. Some of the pre-app talks and site visits can be really extensive and time consuming.

If we have a concern regarding sustainability, it is about the recruitment and retention of planners. The ambition to recruit 300 new planners is laudable and welcome, and it seems churlish to point out the fact that it equates to just one planner per authority—but that is the reality. The Home Builders Federation pointed out, through a freedom of information request, that 80% of local planning authorities are operating below capacity.

The recruitment and retention problem is exacerbated by differential salaries. The best young graduates appear to be snapped up by the major housebuilders, as they can afford to pay significantly more than local authorities. Especially in areas of high house prices, that can make recruitment even more of a challenge.

The Minister will know that some local authorities are working together to look for solutions by co-operating rather than working against each other, competing for the same people and even poaching. Career opportunities can be better for an individual if they can work across several councils, especially with smaller districts.

The RTPI has pointed an important fact—that there is a lack of robust data on how many planning officers we have in each region and local planning area. Accurate data would help to pinpoint where resources and training are most needed, so perhaps the Minister could give us some more detail on the changes to the Pathways to Planning programme.

We think that all these increases are necessary and overdue, and accept that it is sensible to tie this to an annual increase. The fact that previous rises were not index-linked was part of the problem. The gap between the cost of processing an application and the fees charged has widened significantly over time.

There has been some talk of monitoring and ring-fencing of funds. Because of the parlous situation of local government funding, will local authorities rob Peter to pay Paul? In my experience, most councils will honour the intentions of government when money is handed out for specific needs, and we see no reason why that would not be the case here, without the need to mandate it or introduce checks. This Government are committed to decentralisation, so it is essential to let go and trust local authorities. Trying to micromanage budgets could be unnecessarily overbearing. We believe that councils should make all their own spending decisions. The Government already have mechanisms in place to monitor planning performance.

The Minister was right to point out that councils get no fees from the massive extension to permitted development rights, yet when there are problems with those conversions, the planners are drafted in to give advice and help to put things right. The key is that if there had been a need to obtain planning permission, the issues would have been sorted out right at the beginning. Will the forthcoming planning Bill be more helpful in this regard? We hope so, and in particular we look forward to allowing local planning authorities to set their own planning fees to meet their costs. A degree of flexibility to adjust to local circumstances and needs is essential.

Private Rented Sector: Affordable Rents

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Thursday 27th February 2025 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

I understand the point the right reverend Prelate makes about the conversion of family homes into HMOs. I do not have those figures here, so I will write to her with a response.

[Baroness Thornhill (LD)]

My Lords, evidence from Scotland shows that only 4% of tenants with a rent rise use the First-tier Tribunal to challenge that rise. How will the Government ensure that more tenants are aware of and use this right? Does the Minister accept that, in a system where demand significantly outstrips supply, a tribunal decision that the rent is fair does not make it affordable?

[Baroness Taylor of Stevenage (Lab)]

I absolutely understand the point the noble Baroness makes, but tenants will be able to dispute rent increases they think are above market rate by referring their case to the First-tier Tribunal. The tribunal will assess what the landlord could expect to receive if re-letting the property on the open market, and it will determine the rent. Both landlords and tenants will have the opportunity to submit evidence, and the tribunal will not be able to determine a rent increase higher than the landlord had originally proposed—all through our Renters’ Rights Bill. So we are improving the position for tenants, and for landlords, who will be able to make their case at the tribunal.

Homelessness

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Tuesday 21st January 2025 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

The right reverend Prelate is right to highlight homelessness for ex-offenders. Since 2021, more than £33 million has been awarded to local authorities to support nearly 6,000 ex-offenders into their own private rented accommodation. The number of individuals still enrolled on the programme and sustaining tenancies is nearly 3,000. The funding provided allows schemes to offer a range of support. It is very important that, alongside housing, we get that support, consisting of rental deposits, landlord incentives, and dedicated support staff with landlord liaison and tenancy support officers. That complements the MoJ’s community accommodation service. The right reverend Prelate is right that housing is key to preventing re-offending.

[Baroness Thornhill (LD)]

My Lords, worryingly, the total spend on homelessness is unknown, largely due to a loophole in what we call exempt accommodation, which I am sure the Minister is aware of. The usage of this is not tracked, and it is now evident that it attracts some of the worst providers. Can the Minister assure us that this Government will get to grips with this unquantified and uncontrolled spending, and with those who are exploiting some of the most vulnerable people in society and the public purse?

[Baroness Taylor of Stevenage (Lab)]

The noble Baroness is quite right. It is outrageous that people choose to exploit the individuals concerned in this situation and the councils that have to fund their accommodation. We are doing everything we can to discover the extent of this and to tackle it head on. We recognise the increasing costs of that temporary accommodation and the pressure that it places on council budgets. As well as the homelessness prevention grant, councils are expected to draw from their wider local government finance, as the noble Baroness is aware. The overall local government settlement made extra provision for that, as well as the additional homelessness funding. It is totally unacceptable for homeless people to be exploited. We continue to track that down everywhere we can.

English Devolution

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Thursday 19th December 2024 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

My Lords, there are two absolutely key incentives to this programme of going forward with a mayor. Mayors will get new powers, devolved from Westminster, in a number of areas of competence. With the patience of the House, I will repeat those again: transport and local infrastructure; skills and employment support; housing and strategic planning; economic development and regeneration; environment and climate change; health, well-being and public service reform; and public safety. We are already setting out integrated budgets for the more established mayoral authorities to enable them to do that. There is a huge incentive to do that, as well as a seat around the table of the Council of the Nations and Regions. I hope local areas will see that as a positive opportunity. If they want to take more time to get there, that is fine, but it will be a great opportunity for our local regions.

[Baroness Thornhill (LD)]

My Lords, I have the dubious distinction of holding a job as a directly elected mayor for 16 years, in the role that my party wished would never exist, so we have had an interesting debate. I absolutely understand some of the positives of the mayoral model—she would say that, wouldn’t she?—but I also appreciate the issues about democratic deficit. When Tony Blair imagined and brought into being directly elected mayors, he saw that the democratic deficit and the electoral process worked against a mayor having a real broad consensus in an area to be the chosen person. So he rightly ditched first past the post and brought in what we would consider to be an inferior PR: the alternative vote system. As we know, that was abolished by the previous Government—and one can only think about the reasons they might have had to do that. Genuinely, if you want a super-mayor with superpowers to really command authority and respect over an area, people must feel that their vote counts. At least in an AV model, the vast majority of people actually get their first or second choice candidate to win. Under first past the post, the winner, as we all know, can actually receive fewer votes than the rest of the field put together, which cannot be right if you are devolving that amount of power.

[Baroness Taylor of Stevenage (Lab)]

The noble Baroness provided a wonderful role model for mayors going forward. Some of the innovations that she introduced during her time as Mayor of Watford are legendary, so I thank her for that service.

Mayors can use their mandate for change to take the difficult decisions needed. As the noble Baroness will be aware, they have both standing and soft power to convene local partners and tackle shared problems directly, exercising devolved powers and attracting inward investment. They have a platform for tackling obstacles to growth that might need a regional approach. Mayors are accountable to their citizens, as she rightly points out, and have the profile to stand up for them on a national stage and to partner with and challenge central government where needed—and of course it is needed sometimes.

As for the electoral system for mayors, we are not proposing to change that just now.

Housing: Permitted Development Rights

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Wednesday 18th December 2024 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

My noble friend makes an excellent point about funding for affordable housing. Even in a very tight budget round, the Government have allocated an additional £500 million towards affordable housing, which brings the total up to around £3 billion altogether. But we need to consider all sources of funding. I spoke to a housing investment forum in the City of London just a few weeks ago, and there is great interest in this area; and of course, we still need to look at pension funds further for local investment to drive the housing market.

[Baroness Thornhill (LD)]

My Lords, surely it is the Government’s mission to create decent homes and not the slums of the future, and I am at a loss to know why the Government are procrastinating on this. Surely it is time to insist on full planning permission for the larger schemes, or at least to revert to the regulations that were in place before 2012.

[Baroness Taylor of Stevenage (Lab)]

I take the noble Baroness’s point; we need to keep this continually under review. Some of the permitted development homes have been of fair quality and have provided homes for people. But we need to continue to press that all new homes delivered through permitted development rights must provide adequate light, meet nationally described space standards and be decent, fit and safe for the people who live in them. We will continue to do that. Where there are bigger schemes, equally, they must meet those requirements.

Planning Committees: Reform

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Thursday 12th December 2024 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Baroness for her question. I am not a lawyer, so I do not want to get involved in discussions about the merits of judicial review. People need to have some recourse to law at some stage. I will take her question back, because she makes a very good point. If she wants to put in a submission as a response to the working paper, I would be very pleased to consider it.

[Baroness Thornhill (LD)]

My Lords, the Deputy Prime Minister has flagged up the role of elected mayors of combined authorities. As someone who lamented the coalition scrapping regional spatial strategies, I see this as a possible way of replacing those. Can the Minister perhaps flesh out a little how she sees that layer working?

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Baroness for her question. There certainly needs to be a strategic planning level above the level of local plans. She can expect to see more news about that in the English devolution White Paper that will be coming out shortly.

New Homes

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Wednesday 11th December 2024 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

I am grateful to the noble Lord for giving me the opportunity to say that I went to visit British Offsite with Weston Homes in Braintree earlier this week. What a fantastic example of British innovation, using recycled steel to build MMC products. MMC is an important opportunity to improve productivity in the construction sector, to deliver quickly the very high-quality energy-efficient homes we need, and to create new and diverse jobs. We are working to address the strategic barriers to the further uptake of MMC, including improved supply chain confidence, clarity for warranty and insurance markets, and planning reform. We will say more about that in the long-term housing strategy next year.

[Baroness Thornhill (LD)]

My Lords, there are currently tens of thousands of Section 106 affordable homes with detailed planning permission waiting to be built out on active sites, but stuck because the registered providers will not take them on due to the current financial capacity in that sector. Will the Government as a short-term emergency measure consider the use of Homes England grant funding specifically, so that registered providers can afford to take up these much-needed affordable homes on these stuck sites?

[Baroness Taylor of Stevenage (Lab)]

The noble Baroness is quite right about the stuck sites but, in spite of the very difficult Budget round this year, the Government have put £500 million more into affordable housing. That takes the total for affordable housing up to about £3 billion. Homes England is working through its programme of how it is going to support the delivery of those affordable homes. I am sure that support for registered providers will form part of that.

Landlords: Long-term Rentals

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Wednesday 27th November 2024 Lords Chamber

[Baroness Thornhill (LD)]

I beg leave to ask the Question standing in my name on the Order Paper and declare my interest as a vice president of the Local Government Association.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

I thank the noble Baroness for her Question. The Government value the contribution made by responsible landlords who provide quality homes for tenants. They form a vital part of our housing market. Our Renters’ Rights Bill ensures that landlords have the confidence and support they need to continue to invest in the sector and we do not expect it to have a destabilising effect on the market. We have included provisions in the Bill to make sure that landlords cannot evict tenants simply to turn the property into a short-term let. Landlords and tenants are equally important. Landlords want good tenants. Tenants want good landlords. We hope that the Bill will make things better.

--- Later in debate ---

[Baroness Thornhill (LD)]

I did ask what the noble Baroness felt could be done about it. I asked my Question first, but my question is: surely this is bonkers and can we not work out some protocol so that councils and government offices are not outbidding each other?

[Baroness Taylor of Stevenage (Lab)]

My Lords, of course the noble Baroness is quite right to flag up the issue of the terrible shortage of housing. The answer in the medium to longer term is just to get more housing built, and we are straining every sinew to do just that. In terms of the way that short-term lets work, we know that they can benefit economies through visitor spend and creating employment opportunities for local people. However, we appreciate that excessive concentrations of that in some parts of the country impact availability and affordability. I know that this competition between local authorities and government departments for housing is causing a real problem. We are introducing a registration scheme for short-term lets to protect our communities, abolishing things such as the furnished holiday let tax regime, to remove the tax incentive that short-term let owners have over long-term landlords. We recognise that more needs to be done to level the playing field between short and long-term tenures. Long-term tenures are important, and they need to be affordable long-term tenures.

Building Homes

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Tuesday 30th July 2024 Lords Chamber

[Baroness Thornhill (LD)]

My Lords, we too are shocked by the appalling incident in Southport and feel very deeply for all the families concerned, and the knock-on effect in the community.

What a pleasure it is to listen to the noble Baroness, Lady Scott; now that she is no longer opposite me on the Benches I will have to get used to seeing her in profile. She always engages constructively and generously with her time, and I am sure that will continue. I agree with a lot of what she said, but I have a slightly different emphasis because I passionately want this housing agenda to succeed. We all know and understand the problems and the bigger picture, and it is indeed dire. There is so much to commend in what has been said today that it is almost too difficult to decide which bits to pick.

I start by saying that I welcome the link between economic growth and housing. Of all the things to get UK plc going, housing has always been there as a solution to a lot of our economic woes, so I sincerely hope that it works. The challenge will be in turning the Deputy Prime Minister’s passionate rhetoric into reality. It is a wicked issue, and it has been caused by decades of failure to build enough homes. I do not think we should be always apportioning blame; this is a long-term systemic problem. I look forward to working on the forthcoming legislation, but I feel that there is going to be a lot of it. The devil will be in the detail, and that will come later. Within the rhetoric, there are a lot of conflicts, as the noble Baroness to the side of me hinted at. The Statement said that the Government want to bring stability into the planning system—I doubt very much that this will bring much stability.

Let us go to the big issues. I start with targets. At the election, all the parties tried to outbid each other with the numbers game. Targets do not build homes, but they send a very powerful message to local planning authorities. However, there have to be consequences. Can the Minister outline what they might be? Councillors are not going to change their behaviour overnight, so what are we going to do to change the public narrative and turn our nimbys into yimbys? How do the Government intend to engage the public and the councillors in the need for more homes? What is the future of the housing delivery test? What about the two-thirds of councils that do not have an up-to-date plan? I would like to ban the phrase, “Build the right homes in the right places”, as it is a fig leaf for anybody to say anything. You hear it said by protestors who are for and against building. I want to know what it actually means. My big question to the Minister is, in short: what is going to change to change the narrative and the culture around housebuilding?

That brings us to the standard method to allocate the targets. I welcome a more balanced approach; I felt that the previous approach pitted urban authorities against rural authorities, which is never good. The Statement talked about an uplift where house prices are more out of step with local incomes. What does that mean in practice? Do the Government really believe that we can build enough homes to affect market prices? Is that even desirable? Both Barker and Letwin and several academics have said that that just is not possible, and if it were that it would take decades. I feel we should be concentrating on affordability as an issue. In those areas where there is that discrepancy, it is all about the need for social housing. I hope that the Government will stop saying “affordable” and use the terms appropriately. In high-cost housing areas we need social housing to keep balanced communities and keep people cleaning our streets, working in our care homes, et cetera. I hope that funding from Homes England reflects a real shift towards social housing.

In effect, all the Government’s ambitions will come to nothing if we do not tackle the skills shortage and the issues within the workforce. What are the plans to reverse this current trend, especially as we know that a considerable number of the current workforce are due to retire? What are we doing differently from what was already in position to reverse that trend? How will SME builders be incentivised to build more and join this council house revolution? As the noble Baroness asked, what is happening in the areas that have been in an effective moratorium due to biodiversity net gain—where some of them are clapping their hands and saying, “Whoopee-do! This is the best thing that has happened”?

With regard to the green belt, in my authority I used to talk about bronze, silver and gold. We all knew what our gold was, and there was some debate about what was bronze and therefore able to be built on, but doing that is not going to be as easy as it would appear. Take the petrol station example. I know of a petrol station near where my daughter lives; it is derelict and an eyesore, but it is right next to a dual carriageway, miles away from any other homes, and it has no facilities. I hope there is a little more local flexibility on that.

As for building the infrastructure upfront and aligned to the development, that is ideal but very challenging. It is perhaps slightly easier in larger-scale developments, but in my area a lot of the development is smaller sites and infill. The impact on infrastructure is cumulative and lags behind the building of houses. I will be interested in how the Government intend to reverse that.

On right to buy, I hope that there is some local flexibility to suspend right to buy if a local authority can prove that that is in its interests within its community.

There is loads more in this Statement. I expect we will have plenty of time over forthcoming years to discuss much of this, because, as the Minister said, there are no quick fixes. However, it is important to send out messages different from some of the messages we have had hitherto.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baronesses, Lady Scott and Lady Thornhill, for their contributions on this topic which were thoughtful, as usual. We have had many discussions in this House on these subjects, and it is interesting to be on the other side of the Chamber doing so.

Without immediate bold action, the number of homes will continue to decrease, falling even further behind the needs of the people of this country. The noble Baroness, Lady Scott, mentioned targets. I have already commented on the dramatic fall off the cliff in housebuilding since the removal of targets. It is clear that we need to set targets. The measures announced today are ambitious, but they are measures we must take if we are going to improve housing affordability and turbocharge the growth we need.

The scale of the response must match the scale of the challenge—and it is a challenge; I am not making light of that in any way. This is the worst housing crisis we have had in living memory. There are not enough homes. This matters for all the reasons we have discussed so often, such as skyrocketing rents, record homelessness, falling home ownership and the setting of unreachable housing targets that have repeatedly not been met. The previous Government failed every year to meet that 300,000 homes target and presided over this drop-off in very recent times.

I turn to the specific questions. The noble Baroness, Lady Scott, spoke about the local voice and asked how it is going to be heard. The local voice is always important in the planning process, and it will remain so. There are no plans to change the process of deep and wide consultation on local plans, as I said when I repeated the Statement, but it will not be about whether or not housing is built, because we need to deliver the targets. It might be about how it is built and where, but it will not be about whether it is built. That is the difference that we are setting out in this Statement today.

On the simplification of plans, it is not the intention to make plans more complicated; this is just a change to the way plans will take housing targets into consideration.

On future funding, there definitely will be a new affordable homes programme after the current programme ends. The announcement is clear. We will bring forward details of future government investment in social and affordable housing at the spending review, enabling providers to plan for the future as they develop to deliver the biggest increase in affordable housing in a generation. We will also work with our mayors in local areas to consider how funding can be used in their areas to support devolution. In fact, I will be having a conversation later this afternoon with our mayors and leaders around the country to discuss some of the issues in this consultation with them.

The noble Baroness asked about nutrient neutrality, and it is important that I answer that question specifically. In order to secure the win-win situation for the economy and for nature that we know we can achieve, it is important carefully to consider the way forward, with the help of nature delivery organisations and stakeholders in the sector. That work has already started, and we will continue it over the summer. In the meantime, we will continue to boost the supply of mitigation. We will announce the successful recipients of round two of the local nutrient mitigation fund in the coming weeks. We are also exploring the potential for greater use of strategic approaches to mitigation, whereby, rather than individual developers having to secure their own mitigation for each new project, they are able instead to pay into high-level mitigation projects that are co-ordinated strategically, so they can deliver more effectively and efficiently.

The noble Baroness, Lady Thornhill, talked about stability in the planning system. The intention of this process is to introduce these changes and have a settled system going forward. There have been a lot of changes—we had 16 Housing Ministers in the last two Parliaments—which has created all sorts of turbulence in the system. This has caused local authorities a great deal of concern and has not allowed the system to settle down. I hope that, once the changes are brought in, it will settle down once and for all. The noble Baroness also asked if we can build enough homes to affect house prices. It is an issue, and we will keep that under review, but what is certain is that prices are going up and are unaffordable, as are rents. We have to increase the housing supply in order to have some impact on both the level and the cost of the housing available to our communities.

The noble Baroness also spoke about affordability and social housing. She will know, because she has heard me speak about this issue many times in this Chamber, of my determination not to conflate the two things. There is a difference between affordable housing and social housing, and we must deliver both. There will be funding and incentives to deliver more social housing, but both are necessary. I hope we can move that forward as quickly as possible.

The noble Baroness also asked about right to buy. It is not currently the intention to suspend right to buy, but some significant changes to that regime are coming, particularly to the way we allow local authorities to use the funding from right to buy. The problem has been not right to buy itself, but the failure to replace the houses sold through it. We have seen a very significant drop in the availability of social housing because the houses sold under right to buy have not been replaced. We need to address that issue, and the measures put in place today will, I hope, help.

The method for calculating housing need was not fit for purpose. It relied on 10 year-old data and arbitrary uplifts to that data, which is why it has been being changed. We will make all the targets that result from this mandatory. All local planning authorities without an up-to-date local plan for housing will be held to account for their new housing target once the revised framework is published.

The noble Baroness, Lady Scott, asked about intervention. We want a system that allows for future intervention action to be swift, proportionate and justified by local circumstances. That does not mean there are no circumstances in which local authorities will not be allowed to build to their targets. If there is a very specific set of circumstances, such as flood plains and national parks, they will be taken into account; but otherwise there will be intervention, and we want that to be quick and straightforward to achieve.

It is not about forcing homes on local places. We believe that planning is fundamentally a local activity, and new homes should be built for communities with communities, but less than one-third of places have an up-to-date plan, and that has to change. This has to be about ensuring that local plans are ambitious enough to support the Government’s commitment—and that is the point about numbers—to get to 1.5 million homes in this Parliament. I am not saying that that is not an ambitious target; we are clear-eyed about that, but we cannot shirk the responsibility to all these thousands of homeless families and future generations locked out of home ownership. That is not just for the sake of those who are homeless, although it is very important for them; it is about the cost to the economy of this country. Some local councils are spending one-third of their revenue budgets on homelessness, and the DWP cost has gone up and is now extremely high. So we have to tackle it from an economic as well as a housing point of view. That is why, a matter of weeks into this Government, we are making the bold changes that we need to get us where we need to be.

We have taken decisive and bold action to deal with the housing crisis we are facing. This is just the start: we will set out our long-term strategy shortly, and I am sure that that will be music to the ears of those who produced the recent report calling for a long-term housing strategy. There is a plan to deliver 1.5 million homes that are affordable, high-quality and sustainable, and we will bring forward details of future government investment in housing at the point of the spending review.

Lease Extension Policies for Residential Properties

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Tuesday 30th July 2024 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

My Lords, as the noble Lord says, when property becomes ownerless, the land and buildings escheat to the Crown. That includes the Crown Estate and the royal duchies of Lancaster and Cornwall. If a purchaser is interested, the Crown can sell it so it goes back into private ownership, or the leaseholders are able to collectively purchase the freehold from the Crown. The Government recognise very much that when a freehold becomes ownerless it causes significant problems for leaseholders, but ownerless goods and escheat are complex areas of law, as I have discovered since I heard the noble Lord’s original discussion on this, and need to be considered very carefully. The Law Commission has flagged ownerless land as a possible project for inclusion in its 14th programme of law reform; I think we will be very interested to see what comes out of that review.

[Baroness Thornhill (LD)]

My Lords, can I segue a little from Crown Estate tenants, if the noble Baroness will forgive me? We have 5 million leaseholders in limbo land waiting for the enactment of the 2024 Act. Indeed, we were promised in the recent King’s Speech a new leasehold and commonhold Bill—I see a big smile from the Government Chief Whip there. Therefore, could the noble Baroness urge the Government to set out a timetable as soon as possible for both these things, as limbo land is not a good place to be? Leaseholders have already waited long enough for this much-needed reform.

[Baroness Taylor of Stevenage (Lab)]

The noble Baroness will know that I agree with her sentiments. I have certainly already had the Chief Whip speak about this. As outlined in the King’s Speech, the Government will provide home owners with greater rights, powers and protections over their homes by, first, implementing the provisions of the Leasehold and Freehold Reform Act 2024. Some of that has already been enacted, but there will be a need for some secondary legislation to do the rest. We will then further reform the leasehold system by enacting remaining Law Commission recommendations —which we tried to do with amendments but were not successful—relating to leasehold enfranchisement and the right to manage; tackling unregulated and unaffordable ground rents; and removing the disproportionate and draconian threat of forfeiture as a means of ensuring compliance with the lease agreement. We will take steps to bring the feudal leasehold system to an end, reinvigorating commonhold through a comprehensive new legal framework.

Spending Commitments to Local Councils

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Monday 22nd July 2024 Lords Chamber

[Baroness Thornhill (LD)]

In asking the Question standing in my name on the Order Paper, I declare my interest as the vice-president of the Local Government Association.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, mayors, leaders, councillors and officers around the country have done an amazing job of supporting their communities, but too often in recent years that has been in spite of the Government and not with them. This Government are committed to ensuring that councils have the resources they need to provide public services to their communities in this Parliament. Of course, spending commitments beyond 2024-25 are a matter for the next spending review, but the work of engagement has already begun.

[Baroness Thornhill (LD)]

I thank the Minister for her Answer and warmly welcome her to her new role, for which she is most ably qualified. I am pleased to hear what she has to say, but this money is crucial. Can she be specific about a timeframe as to when councils will hear whether they have got the money? We are talking about many millions of pounds, in certain cases. More importantly, can she reassure the sector that, when decisions are made, they will involve looking at how advanced those projects already are, how much money has already been spent and, in particular, the impact on the financial sustainability of the council if it does not get the promised money? As she knows, for some councils that is critical.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness for her kind comments. We worked together often in Hertfordshire, and I hope that that relationship continues. Local places will rightly seek clarity on existing funding commitments, but as all noble Lords would expect, the Government are fully considering funding arrangements, including the very hard work that has been undertaken on projects to date. We will confirm as quickly as possible how we are going to take those projects forward.

Leasehold and Freehold Reform Bill

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Committee stage
Wednesday 1st May 2024 Lords Chamber

[Baroness Thornhill (LD)]

The noble Lord has hit on a point; in some estates, you build one building that might just meet the requirements, and then more and more are built, and it expands the problem. I agree with a lot of what he said. I was trying to point out that we tend to say it is all on the developers, but I think this is a systemic failure of a series of accountable people. That is what I am trying to say.

Ultimately, I am saying that, sadly for democracy, this is yet another state failure—like WASPI, blood contamination and Windrush, to name but a few. The harsh reality is that the impact of this is felt every day by some people, and is growing: when a leaseholder decides that they want to reinsure or somebody decides that they want to sell, suddenly they are faced with, “Wow, I didn’t realise that there was all of this”. Therefore, the number of people affected is actually growing.

I will end on what my noble friend Lady Pinnock always says: leaseholders have done nothing wrong and everything right. Excellent campaigning from groups such as End Our Cladding Scandal and the non-qualifying leaseholders group has helped us achieve the progress we have made on remediation support. We owe it to them to keep pressing the Government on making sure that all leaseholders are protected from the costs of a situation they did absolutely nothing to cause.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I add my tribute on the sad and sudden passing of Lord Stunell. We worked very closely with him on the levelling-up Bill, and he was such a great asset during the passage of that Bill. Looking at his record over the years, his was a life dedicated to public service, to both national and local government. I hope the noble Baroness will take our condolences back to the Liberal Democrat group, and we will pass them on to his family as well.

The noble Earl, Lord Lytton, is right to call this issue a sorry tale of shame. It is clear from the number of building safety amendments in this group and this Bill, and previously in the levelling-up Bill, that there appears from our debates to be a cross-party consensus from most of us, except the Government Front Bench, of such deep dissatisfaction with building safety in general and the glacial progress on remediation in particular. It was carefully calculated in the recent Times article by Martina Lees, referred to earlier, to show that only 8% of buildings in need have been remedied, not the 21% that the Government claim, and which was mentioned by the right reverend Prelate the Bishop of Lincoln.

As important is the huge number of non-qualifying leaseholders whose dreams of property ownership have turned to nightmares, as the horror of their uncertain financial position, the escalating costs of remediation and the impossibility of selling homes—I have seen evidence of this, as valuers are currently placing values at zero or negative—snatch away their aspirations and leave behind only extreme anxiety. Numbers vary, but the Times estimates the number of affected homes to be up to 1.5 million and, as other noble Lords have said, upwards of 4 million people are affected.

An excellent briefing from the National Residential Landlords Association points out that data remains lacking and estimates that there are approximately 1.3 million leaseholders in buildings less than 11 metres in height and 400,000 leaseholders, referred to by the noble Baroness, Lady Thornhill, in high-rise buildings who are non-qualifying because of other eligibility criteria. Many leaseholders are unaware of their non-qualifying status or are alerted to it only when they receive an invoice for remediation works or attempt to sell their property. It is important to remember that many leaseholders are understandably reluctant to speak out on this issue for fear of further devaluing what they thought was going to be a very valuable property asset.

The scale of this problem is eye-watering. I agree with comments made previously by Members of your Lordships’ House that, unless this is addressed urgently, as more and more leaseholders discover their liability, another enormous injustice scandal will unravel, which will scar whole generations of home owners. The noble Earl, Lord Lytton, referred to the fact that this will escalate over time to the detriment of freeholders and leaseholders, but with the balance of personal financial risk sitting with leaseholders.

The system the Government put in place, which was subject to an update in your Lordships’ House at the end of March, may have made some progress, but as a spokesperson for Grenfell United said:

“Government’s shockingly slow progress towards remediation shows a complete lack of political will to keep people safe in their own homes”.


Giles Grover, of the excellent group End Our Cladding Scandal said:

“The majority of unsafe buildings across the country still don’t have plans in place to fix all issues”.


The 7,283 mid-rise buildings that the Government have estimated to be unsafe are missing from any plan for remediation as they are deemed non-qualifying, and the unbearable pressure of remediation is falling on the ordinary people who make these flats their homes. While the Government have brought forward legislation and statutory instruments to deal with this situation, progress has been slow because issues are being dealt with piecemeal as they arise. Even when legislation has been considered, such as the Building Safety Act 2022, which should have been a comprehensive solution, too often amendments were rejected with serious impacts and consequences for leaseholders only now becoming more apparent.

The noble Earl, Lord Lytton, proposes a comprehensive and detailed framework to encompass the whole situation around building safety remediation that would give more structure to the current piecemeal approach. While I understand that the level of detail that he proposes in this scheme will almost certainly not be greeted by the Minister with the wholehearted approval that it probably deserves, I hope the principle of having such a framework in place and the thorough approach set out by the noble Earl will at least be a matter for reflection and future consideration as the Bill progresses.

Amendments 96 and 97, tabled by the noble Lord, Lord Young of Cookham, his Amendments 99 and 100, to which I have added my name, and Amendments 105E and 105F, tabled by the noble Earl, Lord Lytton, are aimed at ending the iniquitous distinction between qualifying and non-qualifying leaseholders. We cannot simply allow the nightmare that many non-qualifying leaseholders are enduring to continue.

We totally support the aim of Amendment 102, in the name of the noble Baroness, Lady Pinnock, in terms of holding the Government to account for the building safety remediation programme. The reporting mechanisms so far do not appear to have accelerated progress on remediation, although it has to be said that the bringing to justice of some of the worst developer offenders, such as those involved with Vista Tower in Stevenage, is welcome. I hope the Government will accept this amendment and bring regular updates before your Lordships’ House, but it would be even better if there could be target dates for outstanding work to be completed. The fact that remediation has dragged on for so many years is a cause of great frustration, anxiety and financial hardship to those affected. Do the Government have a view about a projected end date for these works to be completed? A deadline, even if it is not met by everyone involved, is great for concentrating the minds of those involved in remediation.

In response to the points made by the noble Baroness, Lady Thornhill, and the noble Lord, Lord Empey, I agree with the noble Baroness that it is not just developers who are responsible for this issue. But a big problem here has been the deregulation of the building control function, taking it away from local authorities and allowing developers to pick and choose who their building control inspectors will be. That has been greatly responsible for some of these issues.

Our Amendment 105 is simple and straightforward in its aim. It would bring the beleaguered non-qualified leaseholders, who are in desperate need of remedies for their building defects, within the remit of the Building Safety Act 2022. Surely, if we are concerned about ensuring that people feel safe and are safe in their homes, we can all support that. It remains our position that it should not be the responsibility of leaseholders to suffer the financial consequences of defective building. Amendment 105C in the name of the noble Earl, Lord Lytton, has a similar aim.

I support my noble friend Lord Rooker in his campaign to highlight the danger of—I was going to call them electricity surges, but I had better not now because I will get into trouble with him—neutral current diversion. I want to come back to the case that Martina Lees quoted of Viv Sharma and his Ukrainian wife Julia, who had to leave their nine-storey block when the fire service deemed it unsafe. It had more than 17 defects, caused by the original developers, which should never have been approved by building control. They have been offered less for their property than they bought it for 15 years ago, and they have had to pay for temporary accommodation. Julia has said:

“I’m now 50. How am I supposed to rebuild my life?”


That situation—which is morally wrong, as the noble Lord, Lord Young, said—remains in place. Such situations should have been remedied by the Building Safety Act but were not. We now have another opportunity to put things right, so I hope the Government will do so by accepting the amendments before us today.

Leasehold and Freehold Reform Bill

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Committee stage
Monday 29th April 2024 Lords Chamber

[Baroness Thornhill (LD)]

We fully understand the passion expressed by the noble Lord, Lord Bailey of Paddington, about criminality and having a last resort. We must think of it in regard to the worst rogue landlord offences, of which there are many, and I am sure several noble Lords have seen things worthy of that description. While we do not entirely go along with the noble Lord, we are interested to understand why the Government are using the Leasehold and Freehold Reform Bill to do away with a long-standing leaseholder right to bring a private prosecution against a landlord who has refused service charge and accounts transparency; it is surely a sign that they are trying to hide something.

The Government are bringing forward a new regime for service charges, under which landlords’ failure to comply with the requirement will be subject to damages of no more than £5,000 per leaseholder, which to us feels too low. Why does this policy have to strip leaseholders of a right to pursue a persistently abusive landlord with a private criminal prosecution? If the right was poorly drafted in the first place, surely it should be retained and made effective in the Bill?

We agree to a certain extent with the amendment’s attempt to bring local authorities into scope. As we know from past tragedies, local authorities are often treated far too leniently by leaseholder legislation, receiving exemptions from basic requirements. We broadly agree, but I look forward to the Minister’s response to the amendment.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Lord, Lord Bailey, for his passion on this matter, as the noble Baroness, Lady Thornhill, said. It is appropriate to bring a probing amendment on this, to seek out some clarification from the Government about their intentions. It is clear that service charge accountability sits right at the heart of much of the Bill, and we would not want to do anything against that. It does seem a little odd that part of the Bill’s intention is to remove that right of private prosecution, so I look forward to the Minister’s reply.

The other point raised by the noble Lord was that we are going to have a hiatus when the Bill is passed, because it is not going to come into force until 2025-26. Can the Minister comment on what leaseholders can resort to in that interim period, in order to get matters justified if they have a persistent rogue landlord? Otherwise, we will have a gap where the original provisions are repealed and these ones have not yet come into force.

I agree with the noble Baroness, Lady Thornhill, about council leaseholders. There are other protections in force for council leaseholders. The health and safety Act and its provisions should sit there to protect council leaseholders from any poor landlord practice from councils—I know they have not always done so, but they should.

I am interested to hear the Minister’s response to this very good probing amendment.

--- Later in debate ---

[Baroness Thornhill (LD)]

In the interests of time, I shall be very brief. I agree with much that has been said by the noble Baroness, Lady Fox, and, of course, by the noble Lord, Lord Best, who has, as always, put his finger right on the key issues with his considerable expertise. We look forward to the task force report he mentioned. Successive Governments have, quite rightly, promoted downsizing: the freeing up of a house for families who desperately need a larger family property. However, we have not done anything like enough to investigate the state of retirement housing in this country and certainly not yet got policies right.

Many of the problems in the retirement housing sector have already been mentioned: high service charges and management fees actually hit elderly residents hardest. They are also suffering withdrawal or reduction of the in-house resident manager, who is frequently now off-site. Their property is more difficult to sell because prospective buyers are obviously a smaller target group, but mainly because of the so-called exit fees or event fees charged when the house is sold. So people can find themselves in a position where a retiree’s heirs are locked in to paying for the flat years after their parent has died, because they simply cannot sell it. Ultimately, all this is related to the iniquities of leasehold tenure, which should and must be abolished.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I agree with the noble Baroness, Lady Thornhill, that this will not finally be resolved until we get rid of this leasehold regime. Some of the most heart-rending cases I dealt with as a councillor were from older leaseholders, often on fixed incomes and subject to the most extraordinary hikes in service charges, ground rents and all sorts of other charges that were imposed on them. I have cited cases in previous debates in your Lordships’ House. The experience of the 90 year-old cited by my noble friend Lord Khan earlier today was from Hitchin in my local area.

Leasehold and Freehold Reform Bill

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Committee stage
Wednesday 24th April 2024 Lords Chamber

[Baroness Thornhill (LD)]

My Lords, I suppose I could say “#UsToo”. I support these amendments, which are simple in purpose, in the name of the noble Baroness, Lady Andrews, who summed them up thoroughly, clearly and personally. As things stand under PDR, a freeholder can add two storeys to their existing building as a matter of right, with no planning permission needed: as I look round Watford, I can see evidence of that with my own eyes. But I also know that that can have very serious consequences. As well as the inconvenience of the building work going on for as long as it takes, you also discover that the top-floor flat that you paid a premium for is now worth less as you are a middle-floor flat. Then there is the pressure on communal space and amenities, including the dreaded bin store and the state thereof.

Adding two more storeys to a presumably well-planned block of flats, for a set number of residents, is not consequence-free. But the consequences are absolutely trivial compared with the knock-on effects of such development on the Government’s own stated aim, which is to encourage more leaseholders to buy their freehold. This is an additional and often insurmountable obstacle. It significantly raises the cost of enfranchisement, as has been said. The value of the block will have gone up. The leaseholders are now required to pay more for their freehold. In many parts of the country, this takes it way out of reach, as in the noble Baroness’s case.

The noble Baroness, Lady Andrews, very thoroughly cited a positive trail of support: all the right noises from the Secretary of State in 2021, the Government’s complete recognition of the dilemma and a real promise of the ability to look into some restriction.

It is clear that there is a policy conflict here: the need for more homes, which we all agree on, versus the enfranchisement of leaseholders. As things stand, the homes policy is top trumps. Can the Minister advise on whether there will be a review of PDRs in general, including focusing on unintended consequences such as this and whether there is a way to sort this out in the leaseholder’s favour in the Bill? At the moment, it feels as if the freeholders are still very much holding all the aces and current residents have no voice at all in this significant change to their environment and, possibly, their life chances and finances.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I am very grateful to my noble friend Lady Andrews for the collaborative way in which she has prepared and worked on her amendment, and drawn the attention of the House to what seems to be an omission from the Bill. We believe this needs to be rectified and my noble friend has not only set out, with her usual thorough approach and eloquence, exactly what the issue is, but has also proposed a straightforward and elegant solution, which we support.

My noble friend describes the Law Commission report as adopted by the Government in January 2021. Indeed, the government press release of January 2021 indicated that the Bill would strongly take account of this government commitment to release leaseholders from the straitjacket of hope of future development value. I quote from that press release:

“Leaseholders will also be able to voluntarily agree to a restriction on future development of their property to avoid paying ‘development value’”.


This is based on a Law Commission suggestion, which clearly indicates the direction of travel and which we believe the Government have accepted. To quote from the Law Commission recommendation:

“Premiums would be reduced at the date of the freehold acquisition claim. If leaseholders subsequently decided that they wanted to develop, they would pay a portion of any profit received on a subsequent development to the landlord, rather than (as at present) having to pay development value in respect of a speculative future possibility of development”.


The Law Commission also set out clearly the principle that leaseholders should not need to have to negotiate on a piecemeal basis for this restriction but should be granted it by right. The commission refers to leaseholders of flats acquiring the freehold to their block and states that,

“as they would not be required to pay the landlord an additional sum to reflect the potential to develop their properties, leaseholders would no longer be required to negotiate with the landlord to create such a restriction; rather, they would be entitled to demand such a restriction be included”

and

“disputes, negotiation and litigation about development value would be reduced”.

The Law Commission clearly believed that the election to take a restriction on development outweighed the disadvantages put forward by other consultees and that such an election was eminently possible to implement where there was agreement among leaseholders.

I also point out that this issue arises, in part, from yet another unintended consequence of the permitted development regime—a point mentioned by the noble Baroness, Lady Thornhill—on which I have made my views clear in your Lordships’ House in the past. I am not an unequivocal fan of PD. Permitted development removes the step of local accountability through the planning system, often the contribution to local community infrastructure and almost always the contribution to local affordable housing which would be required through traditional planning applications.

At its worst, permitted development drives a coach and horses through local plans, resulting in residential property in inappropriate areas and buildings, and in taking buildings out of commercial use where it may not be appropriate to do so. In the case of the subject of this amendment, its very existence can create an added financial pressure on those wishing to exercise their enfranchisement rights. That is another reason why we believe that the solution proposed by my noble friend Lady Andrews delivers an equal and justifiable right to leaseholders.

--- Later in debate ---

[Baroness Taylor of Stevenage (Lab)]

My Lords, we welcome the new costs regime provided for by provisions in the Bill, because, as things stand, there is no balance of power: the playing field is tilted very much in favour of landlords rather than leaseholders, and that needs to be addressed. Under the current law, leaseholders are required to pay for certain non-litigation costs incurred by their landlord when responding to an enfranchisement or lease extension claim. That obviously does not reflect normal practice in residential conveyancing, where each party bears their own costs. I hope that noble Lords will forgive me for explaining our rationale for this amendment in a bit more detail than is customary for me, but it is a point of real principle, and some technical detail is warranted.

Noble Lords will remember that I quoted from a letter I had received from elderly leaseholders on the first day of Committee. I have received further representations in relation to excessive charges for non-litigation costs, which I will read out as they are a perfect illustration of the problem these amendments seek to address. I appreciate that this example relates to a ground rent dispute, but it would be the same issue for an enfranchisement or extension claim.

“After the Freeholder asks a ridiculous sum in increased ground rent with their ground rent review (every 4 years) this causes the leaseholder to then employ both a Solicitor and Surveyor to counter this high valuation which incidentally had no calculations to back it up. Therefore so far this year having paid £3,000 for a surveyor to dispute this figure and a lawyer costing so far £3,600, the freeholders haven’t even tried to justify their huge increase and valuation. Now after 4 months having passed and the 3-month negotiation ended and the Freeholders have made no effort to take part, negotiate or even contact our surveyor they now say this increase is NOT agreed …


If we lose with the third-party surveyor’s estimate and the increase is even only minimal we still have to pay the third-party surveyor’s fees plus the freeholder’s lawyer’s fees and our own lawyer’s fees, therefore it could end up costing as much as £15,000. Plus if they look to backdate the increase over the past 6 years’ Ground Rent charges this could amount to who knows what?


Even if we win we still lose a great amount of costs and fees plus we cannot look forward to a reduction in Ground Rent as the lease states an ‘Upward Only Revision’. Therefore freeholders know they can put in totally unrealistic figures for rent increase of whatever they want as the leaseholders are on a hiding to nothing … until they throw in the towel.


Additionally, to lodge a dispute at the 1st Tier Tribunal for any high unreasonable charges it is necessary to not pay the bill in question otherwise it is deemed you have agreed to this payment but then withholding payment runs the risk of forfeiture”,


which we will discuss later today. My correspondent goes on to plead that the issue of ground rent increases finally be resolved by the Bill, but their case illustrates the financial and legal minefield that leaseholders face.

The argument for imposing non-litigation costs has always been that, in enfranchisement or lease extension claims, a landlord is being forced to sell his or her asset, which would justify a departure from the practice in open market sales of residential property. However, when it comes to lease extensions or freehold purchases, a landlord is obviously not simply being compensated for the value of the asset they are being compelled to sell. They are instead securing, through the payable premium, a share of the profit to be made from selling to the leaseholders in question. In addition, as things stand, through capitalised ground rents, they are extracting funds from leaseholders over long periods—often decades —prior to securing that profit share, for no explicit services in return.

The valuations of lease extensions and freehold acquisitions under the existing statutory regime rely on prices agreed via an open market transaction, but those valuations do not account for the fact that leaseholders are expected to pay their landlord’s non-litigation costs. Therefore, landlords in enfranchisement or extension transactions receive the price for the asset being sold, which reflects the market rate without non-litigation costs factored in, and their reasonably incurred non-litigation costs on top.

In its 2020 final report on enfranchisement, the Law Commission is very clear that the effects of law and current market practice are that

“the landlord is over-compensated for the non-litigation costs that he or she has had to incur in order to transfer the interest to the leaseholder”.

In addition, many of those who are better resourced could use the fact that such costs are borne by leaseholders as leverage in negotiations on the price of the lease extension or freehold acquisition, confident that the expense of challenging those costs in a tribunal would dissuade many leaseholders from doing so.

The Opposition are clear that freeholders should not receive compensation in respect of non-litigation costs. A landlord selling his or her asset and receiving a share of the profit as a result is not sufficient justification for departing from an arrangement in which reasonable non-litigation costs are factored into the ultimate price. The decision to enfranchise or extend a lease is often not discretionary; it is often a requirement brought about by the fact that a lease is due to expire, because the payable premium is rising as the lease shortens, or as a result of the decision to move or remortgage.

We therefore fully support the intention in the Bill to provide for a new regime based on the principle that leaseholders are not required to pay the freeholder’s non-litigation costs in these circumstances. We note the Law Society’s concern that landlords are being asked to bear their own non-litigation costs, despite the fact that the proposed standard valuation method provided for by Schedule 2 will lead to payable premiums below full open market value because it caps the capitalisation rate. However—and this point touches on one of our previous debates—political decisions set the rules of the game for market competition. In our view, it is simply not the case that there is some kind of inherent market value for premiums entirely independent of legislation in this area. Every sale of a flat and every lease extension process relating to a flat since 1993 has been undertaken against the backdrop of the 1993 Act, which reduced ground rents to a peppercorn.

The market value for premiums is shaped by the laws that the House passes. It is right in principle that, to achieve the Bill’s objectives of making it cheaper and easier for leaseholders in houses and flats to extend their lease or buy their freehold, leaseholders do not pay non-litigation costs in addition to the payment of a premium, as determined by the new method proposed in Schedules 2 and 3. We believe that leaseholders should not be liable for these costs as a result of an enfranchisement or lease extension claim on principle, irrespective of the method by which the premium is calculated. That is why we take issue with the clause as drafted, because it does not protect all leaseholders from liability for costs incurred.

The clause as drafted entails only a selective extension of rights in this area, because it does not ensure that all leaseholders will no longer have to pay their freeholder’s costs when making a claim. Instead, it makes exceptions to the general rule, whereby the price payable for the freehold or extended lease is below an amount to be prescribed in regulations.

We understand the rationale—namely, that leaseholders should pay a freeholder’s non-litigation costs in such circumstances, so that low-value claims do not cost the freeholder money. The Minister has been very clear that the Government believe that this must happen to ensure that the process is fair for both sides. We also appreciate that there are risks in prohibiting a landlord from passing on non-litigation costs to leaseholders in cases where they would be required to spend more in carrying out the transaction than they received for the asset. The Law Commission highlighted a number of those risks, including the incentive created for landlords not to co-operate with a claim, or for them to transfer the low-value freehold into the name of a shell company and then liquidate the company.

However, we are concerned that exempting claims below a certain value will create a different set of practical problems. These include costly and time-consuming disputes in cases in which the price payable is close to the level of the non-litigation costs in question for low-value claims, and the potential for landlords to game the system by arguing for a price payable below the threshold in order to secure both it and associated non-litigation costs because of the burden of disputing the amount.

Taking a step back, we fail to see the logic in the Government’s position. On the one hand, they seem to be ignoring the Law Commission’s recommendations in relation to costs; they have chosen to provide for a general rule that leaseholders are not required to make a contribution to their landlord’s non-litigation costs, but have not chosen to adopt a valuation methodology that seeks to reflect open market value, which was the commission’s stated prerequisite for such a rule. On the other hand, they are following strictly the commission’s recommendations in respect of low-value claims.

Put simply, we believe that, by means of this Bill, we should take the political decision to remove any exception to the general rule that leaseholders are not required to pay the freeholder’s non- litigation costs in such circumstances. I hope the Minister will give this careful consideration; otherwise, this section of the Bill has the potential to undermine the stated aim to increase, simplify and reduce the cost of enfranchisement. I beg to move.

[Baroness Thornhill (LD)]

My Lords, when we started the debate today, I felt like I was wading in mud. I feel I am still in the mud—it has got thicker, and the fog has come down. This is a complex and complicated Bill. I have really enjoyed listening to the arguments and the debate; I have already learned a lot. Report will be a lot better—certainly for me.

I will try to keep my remarks short and my questions simple in order to seek clarification. The noble Baroness, Lady Taylor, has, in her own style, ably illustrated the issue and set out the case for her amendments in great detail. I will not repeat those—some paragraphs have already been knocked out of my speech.

The newly inserted Sections 19A and 89A set out the general rule that neither a current nor a former tenant is liable for any costs incurred by another person because of enfranchisement or a lease extension claim. However, new Sections 19C and 89C set out the exceptions to this rule. The debate is around whether these exceptions are justified. We are seeking the Government’s justification for this variance. Amendments 47 and 48 from the noble Baroness, Lady Taylor, would delete these exceptions, so that leaseholders would not be liable to pay their landlord’s non-litigation costs under any circumstances. We agree. Each side should pay its own costs; we are unsure as to why this is not the case.

When this was debated in the Commons, the Government argued that, while the main aim of the changes to the costs regime was to address the imbalance of power that has existed between the landlord and tenant, they had a desire to ensure fairness on both sides. Sections 19C and 89C prevent the landlord incurring a net financial loss when leaseholders exercise their rights to enfranchisement and lease extension, thus acknowledging that this really is a balancing act. We look forward to the Minister’s comments as to how the Government have managed to keep the scales level.

I agree with the comments made in the debates on the last two groups. Some of the problems are because much too much is being left for later regulations, in either guidance or SIs. I believe that we should have had a clear government position on issues as important as landlord costs, deferment and capitalisation rates. This is still too vague. Such uncertainty is bad, not only for the leaseholders but for us parliamentarians who would hope to scrutinise and improve the legislation. However, I note the explanation from the Minister in the last group.

The Law Commission’s report highlights that the current law means that the landlord is overcompensated for these non-litigation costs. We support the Government in saying that costs should be balanced. It has to be said that these amendments raise important questions as to whether new Sections 19C and 89C undermine this aim. The noble Baroness, Lady Taylor, has made a good case to that effect.

Levelling-up and Regeneration Bill

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Report stage
Wednesday 6th September 2023 Lords Chamber

[Baroness Thornhill (LD)]

My Lords, in the interests of balance, and despite the eloquence of the noble Lord, Lord Young, I am rising briefly to support street votes and commend the Government on staying with it. As we have heard, it is a Marmite proposal, and I agree with the noble Lord that there are many questions to be answered. It feels very strange that I will oppose Amendments 212 and 214 to 216 from the noble Lord, Lord Young, as my respect for his housing wisdom usually sees me eagerly doing a nodding dog impression in agreement. On this occasion it was my noble friend Lady Pinnock who was doing so, but I suspect we are definitely coming at this from very different angles. I wish to be clear that we on these Benches have very mixed views about street votes and that there are legitimate concerns that they are not compatible with the hierarchy of plans that the Bill proposes, that they just do not fit, or that it is a daft idea that will never take off. There are also legitimate concerns about how it will work in practice.

Like many here, I have sat in too many meetings being screamed and shouted at for daring to allow homes to be built that apparently nobody wants and will bring chaos to the neighbourhood—noble Lords can imagine the scene. This is in a town where the self-same people complain that house prices have driven their children out of the town and that they just cannot afford to live here; that was my fault too, apparently. They then complain about the number of flats being built that apparently no one wants to live in. I have come home from such meetings in despair, and we have to work with the population at large to change that narrative. In that development all the flats are now lived in, and very nice they are too, with mixed tenure from market sales through to social rent. What was it really all about?

There is an old adage: if you do what you always do, you get what you always get. I believe that street votes are an attempt to break that negative cycle. Can it really do any significant harm to let this one fly and just see what happens? Pilots are certainly a very good way of doing that. If nothing comes of it, we have lost nothing, and if anything starts to happen it is learning for the future. It is progress—positive public engagement in development, which has to be welcome. I do not believe that any more harm can be done—probably far less than that already done by permitted development rights, for example.

I have long been a supporter of the key principles behind street votes, an attempt to deliver more homes and better places in sustainable ways that are supported by local communities, which is the key aspiration. As an encouraging signal, we have seen what success neighbourhood planning has been in some areas, probably even a few, delivering popular new homes that meet the needs of the community. I believe that street votes might possibly continue this tradition, enabling popular and high-quality homes where they are most needed and helping to ease the housing crisis in a small but significant way by positively engaging residents.

However, I welcome the Government’s concession in their amendments. The Delegated Powers and Regulatory Reform Committee report was right to point out that Henry VIII powers are not appropriate for this case. For example, it is plain that a Minister should not be able to exempt development from biodiversity rules without the consent of Parliament, and I am glad that the Government have listened. In the current anti- development climate, where the nimbies appear to have gone bananas and build absolutely nothing anywhere near anybody, anything that might just get some people to become “yimbies” has to be worth a try.

[Baroness Taylor of Stevenage (Lab)]

My Lords, the discussions and continuing concerns in relation to the proposals in the Bill on street votes once again make the strong case for pre-legislation scrutiny. As the noble Lord, Lord Young, outlined, these proposals seem to have been fast-tracked straight into the Bill without any consultation with the sector that might have avoided some of the many concerns we now have. We note that the government amendments are already starting to recognise some of the complexities inherent in the proposals for street votes, which were explored in great detail in Committee. Considerable questions remain to be answered about the process, finances and other resources, and the relationship with other elements of the planning system.

First, let me be clear that we understand and support the idea behind the proposal of greater public engagement in planning matters, on which I agree with the noble Baroness, Lady Thornhill. Our concerns are about the detail. Why could that engagement not be advisory to planning, rather than a formal planning process in its own right? There does not appear to have been any assessment of the cost and resource implications of street votes, which could be considerable—for example, additional cost to the local planning authority under new Section 61QD relating to support for the process of street votes. New Section 61QE is the provision for organising the prescribed referenda, and we all know how expensive it is to hold a referendum. New Section 61QK allocates financial assistance for street votes and could, for example, result in hefty consultancy fees, particularly bearing in mind that it is likely that many street vote processes will rely on external consultancy support if they are to prepare papers to a standard that will meet the test of an inquiry in public. The provision for loans, guarantees and indemnities in relation to street votes projects is in the Bill; how and by whom will the due diligence be done on these? That in itself could present a major burden to local authorities.

Lastly, Clause 101 of the Bill makes provision for developments that come forward from the street vote process to be subject to community infrastructure levy. As it has taken local authorities some years since the implementation of CIL to become proficient in negotiating these agreements, and they could take considerable time and expertise, just who is going to undertake that work? Secondly, there is the potential for this to place even further burdens on the Planning Inspectorate, where there does not seem to be, at the current time, enough capacity to deal with current workloads.

We were very grateful to the noble Earl, Lord Howe, for his letter addressing the concerns we expressed in Committee—concerns raised by the noble Lord, Lord Stunell, on the relationship with neighbourhood plans, and the noble Baroness, Lady Pinnock, on the definition of a street. I think the noble Lord, Lord Young, clearly outlined how that may get complicated, and I have my own concerns about the finance. In relation to the considerable concerns on the financial and resource aspects, we feel it would have been far more helpful for those who have been promoting street votes to have carefully assessed the impact before the proposals came forward. The letter of the noble Earl, Lord Howe, stated:

“The Government is aware street votes will require local planning authorities and the Planning Inspectorate to perform functions in the process, and that these will result in new burdens and associated costs. The extent of these costs will be clearer as we develop the detail of new regulations. New burdens on local planning authorities will be assessed and addressed in accordance with well-established convention, and costs incurred by the Inspectorate will be taken into account as we determine future budget allocations”.


We have to ask: is the considerable additional funding that may be needed to meet these costs really a priority in a time of such considerable budget and funding pressures, both for the Government and for local government? I note that the Local Government Association continues to oppose these proposals.

I add my thanks to those on the Delegated Powers and Regulatory Reform Committee, who have looked at this in great detail and at least undertaken some of the scrutiny that might have been useful before the proposals went into the Bill. The noble Lord, Lord Young, outlined that there are many questions still remaining on this. He ably set out a very clear example of how the flaws in the thinking behind the proposal might impact on local people. The noble Baroness, Lady Thornhill, spoke about the relationship between these orders and other neighbourhood and local plans which will be made.

I note that the noble Lord, Lord Young, wishes to strike the clauses out of the Bill. He made a very cogent case for doing so. I think his term was “heroically unready for legislation”, which I will not comment on, but it was a good term. If the Minister does not take the advice of the noble Lord, Lord Young—and that may be so, as I understand that the Secretary of State has been convinced of the merits of street votes—can I make a strong plea that there is some engagement with the sector about the detail of how street votes will work before we go any further with this?

Levelling-up and Regeneration Bill

Debate between Baroness Taylor of Stevenage and Baroness Thornhill

Report stage
Thursday 13th July 2023 Lords Chamber

[Baroness Thornhill (LD)]

My Lords, I rise to move this amendment, to which I have added my name, on behalf of my noble friend Lady Scott of Needham Market, who cannot be in the House today. It gives me great pleasure to speak to this important amendment, given the support it received in Committee. Because it was debated well then and we do not intend to test the opinion of the House, I will be brief-ish.

This is another amendment that echoes what was said in the previous amendment, because it seeks to address a fundamental inequality: in short, town and parish councils do not currently have the power to award a carer’s allowance to their councillors, even if they want to and can afford to, yet every other councillor at every other level of local government can. This amendment asks simply for the decision to rest with the councils themselves—these are their councillors, their choice and their budget.

In my time in local government it was apparent, and still is, that all the parties struggle to get high-calibre people standing for council and, more importantly, to encourage them to stand again. The drop-off rates are quite alarming. There are lots of credible statistics on this; I will not drag things out by citing them, but they are there.

We all know that the LGA, the Fawcett Society, the Electoral Commission and others have worked to improve the diversity of elected representatives, so we know how important it is that councillors reflect the community in which they live. That is very pertinent to town and parish councillors, who really are at the sharp end: they are the closest to those whom they represent and meet them in the pub or the park or at the school gates. I believe that the laws governing the current situation reflect the attitudes of decades ago—the village do-gooder stepping up and speaking for the humble folk, as a community service and a bit of volunteer work—so town and parish councils do not have the power to give their councillors a carer’s allowance. Surely we do not see the role that way now. Times have changed, and roles and responsibilities have changed.

I argue that those closest to people can best say what the impacts of big decisions are on the lives of those whom they represent. We should be removing barriers and obstacles that prevent people stepping up and serving their communities, and encouraging all councils to embrace the diversity within their communities.

Personally, I would not be standing here today if I had not been able to pay a babysitter when I became a councillor. I just could not have afforded it, and there will be other women in that position. It is, sadly, still true today that the majority of carers are still women.

I know that in Committee, Ministers said that they were concerned about the cost burden this would place on local council budgets. Yet, when asked what the costs would be, they did not know. We do know that since the dependent carer’s allowance was introduced in Wales, there has been no impact on the budgets of community and town councils. We know from the information gathered by the National Association of Local Councils that many councils would meet these modest additional costs out of existing budgets. Surely it should be a local matter if councils want to increase their tiny precepts to invest in attracting, retaining and supporting councillors? That is local democracy in action.

Finally, in 2019, Weymouth Town Council made a proposal to the Government under the Sustainable Communities Act to extend the carer’s allowance to parish councillors. It is still waiting for a decision, despite the rules stating that it should have received one from the Secretary of State within six months. Could the Minister agree at least to chase this up, please?

Parish and town councils are out of step with the rest of local government. This important amendment in the name of my noble friend Lady Scott of Needham Market presents the perfect opportunity to right this wrong, to help level up local democracy and to give those councillors with caring responsibilities just a little much-needed help to perform their important civic role. The Bill is in part about handing powers down from the Government to the many and various forms of local government—real devolution. It is right to do so, and proud to do so. Why not devolve further down to parish councils and give them this right? I hope the Minister will give this real consideration. I beg to move.

[Baroness Taylor of Stevenage (Lab)]

My Lords, our network of over 10,000 community, neighbourhood, parish and town councils provides that invaluable first tier of services that people care about, notice and see every day. This is because they impact so very close to their front doors. During discussions on the Bill, it has been a feature to hear Members across your Lordships’ House championing these councils, which illustrates their vibrant contribution to our democracy. Amendments in this group are no exception.

We welcome Amendment 59 in the names of the noble Baronesses, Lady Scott and Lady Thornhill, which would make provision for parish councils to be able to meet carers’ expenses. I welcome the comments of the noble Baroness, Lady Thornhill, about taking down barriers and increasing diversity at all levels of council activity. Like the noble Baroness, Lady Thornhill, if I had not been able to have carer’s allowance for babysitting fees for my daughter, who was just eight when I first joined the council, I would not be here today. These are very important steps that we can take.

I also know one councillor in Stevenage whose husband is profoundly disabled following a stroke. She benefits from carer’s allowance. Another councillor has a severely learning-disabled son. The fees for looking after him are over £80 an hour; a contribution to that from the council means that she can participate in council activity. The input these women provide on issues of disability, as well as many other issues—and their long experience—is incredibly helpful to our council. That should be extended to parish councils too.

It is vital that we do all we can to encourage a wide range of people to engage in the democratic process at all levels of government. It is often the responsibility of caring that deters people. I look forward to hearing the Minister’s response, and I hope that the Government will keep this under close consideration.