Landlords: Long-term Rentals

Baroness Thornhill Excerpts

Wednesday 27th November 2024 Lords Chamber

Asked by

[Baroness Thornhill]

To ask His Majesty’s Government what incentives they propose to introduce to encourage landlords back into the private rented sector for long-term rentals.

[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.

[Lord Truscott (Non-Afl)]

My Lords—

[Baroness Thornhill (LD)]

I thank the noble Baroness for her reply and sincerely hope that the Government’s aspirations are met, but note that most of the actions are going to be in the future. However, I know that the Minister is only too well aware of the crisis in temporary accommodation that is actually caused by over 110,000 households unable to find any affordable accommodation in the private rented sector, where demand is demonstrably not keeping up with supply. What can be done when those landlords that are leaving the private rented sector precisely because there is a shortage can then relet the same property to their own council at a higher rent? Incredulously, this practice is fuelled by councils and the Home Office bidding against each other for the same property, at considerable cost to the taxpayer.

[Noble Lords]

Question!

[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.

Grenfell Tower Inquiry Report

Baroness Thornhill Excerpts

Friday 22nd November 2024 Lords Chamber

[Baroness Thornhill (LD)]

My Lords, it is a privilege to follow the noble Baroness. I echo what she said about who holds the ring in government, because these changes will take time and we need to know who will do so, as government silos are well known and entrenched.

On behalf of these Benches, I pay tribute to Sir Martin Moore-Bick, his team, and the members of Grenfell United and their families and supporters for their relentless search for the truth. It has been a long time coming and I am sure we all regret that too much is still to be done before justice is finally done—if it ever is. The inquiry’s shocking findings place damning blame on companies, the Government, bodies responsible for building regulation and emergency services. It concludes that the victims were “badly failed” by those responsible for their safety and that all the deaths were “avoidable”. Could there be a more succinct, damning and deeply poignant sentence to sum up the Grenfell tragedy?

Sir Martin’s report does not hold back—thank goodness. He has shone a bright light on the cumulative decisions made in dark corners of boardrooms, in Cabinet and council meetings and during the regulation of fire safety and construction methods, and on the interconnectedness of these institutions, which all played a part in what happened on 14 June 2017. “Cumulative” and “interconnectedness” are the two key words that help me begin to understand what is at the root of the report’s reference to failures of government policy and decision-making. It is a simple phrase, but let us try unpacking it.

What shocked me most were the staggering accounts revealing cultures of complacency, denial, lack of scrutiny and accountability, back covering, buck passing, indifference, institutional negligence and even systemic dishonesty by the building contractors and these institutions. All of that created the perfect environment for this tragedy. The report exposes the systemic and entrenched refusal by every one of them to ensure that whistleblowers could speak up without consequence, confident that their concerns would be investigated and taken seriously. Civil servants were found to have ignored, delayed or disregarded concerns. Those who wanted to raise issues were simply too afraid to speak out and those who did were ignored or, worse still, branded as troublemakers. In short, there was a demonstrable endemic culture which led to the lack of importance given to fire safety and social housing tenants, which combined in a perfect storm—only the storm was a horrific fire that claimed 72 lives, including those of 18 children, left scores injured and displaced many families.

To say that the residents of that tower were let down by these institutions is a gross understatement, whether it was a cost-cutting local authority ideologically committed to outsourcing services, a regulation system completely gutted by successive Governments boasting about a bonfire of red tape, the privatisation of building safety testing, a fire service with inadequate controls or a construction industry focused on profits for shareholders and bonuses for senior executives. They were all in part responsible for the deaths that night.

Added to this were decades of underfunding of our public services. We have grown so used to cost cutting that it has become the norm across those services, including local government. We have watched our services be stripped to the bone and some abandoned altogether. There must be consequences from this over time, and we need to acknowledge that this has created a cost-cutting culture across these institutions, with staff under pressure to deliver regardless and discouraged from asking awkward questions.

Those asking such questions are seen as overly negative. They show a “can’t-do” attitude. “You’re not being a team player”. It is chastening to read on the Whistleblowers UK website that 96% of whistleblowers whose cases get to employment tribunals lose. To spell that out, whistleblowers more often than not find themselves on a redundancy list, not for their whistleblowing, of course—there are other ways—but due to “service re-engineering” or similar terms that are difficult to argue against. But some continue to whistleblow and, of the brave souls who do, almost all lose. No wonder they are afraid to come forward if they will lose their job, with the consequences that flow from that. Remember Mid Staffs, where Julie Bailey was forced to close her business and move away and nurse Helene Donnelly was attacked and bullied by colleagues and was too scared to even walk to her car. Do the Government plan to find ways to protect whistleblowers? There are many suggestions as to how this might be accomplished, as surely it is the only way to ensure that failings come to light before another major tragedy happens.

Many staff are stretched in their day jobs as “doing more for less” has been a mantra for years. Within councils, there has been a hollowing out of the role of scrutiny and audit functions, the effective working of which is fundamental to accountability, transparency and resilience. I recall one of the first things I was told as a brand-new councillor by the then Labour leader of Watford Council: “In this job you’ve got to know when you’re being hoodwinked by experts”—only he used more colourful language. I took that lesson with me as mayor and as a peer assessor.

Those on the board of Kensington and Chelsea Tenant Management Organisation should have heeded it. It transpired that it was easy for employees to withhold information, doctor the findings of critical reports and downplay their urgency. Even outright lying was accomplished with ease. In fact, the fire safety reports were not even done by experts; they appointed someone without the relevant expertise and qualifications. Why? Because he lied and embellished his CV and nobody bothered to check his credentials, ask difficult questions, probe reports, scrutinise actions and timelines or test results. In other words, they failed to do their job. They were little more than nodding dogs. Some might call that a harsh caricature, but it is accurate given the evidence in this inquiry.

The cumulative impact over decades of policies designed to shrink the state, decrease regulation and let the market decide has led in part to their interconnectedness in Grenfell. Sadly, we appear not to have learned the lessons from history and so are doomed to repeat it—think Hillsborough, Windrush, Mid Staffs, infected blood and the Post Office, to name only the high-profile ones. Let us be under no illusion: those most impacted by this relentless trajectory are ordinary working people—the so-called “left behind” or “just about managing”. Whatever label we choose to put on them, they are the most marginalised and vulnerable in our society. I looked again at the photographs and heard the life stories of those who died at Grenfell, and they were all of those things. Most importantly, they were men, women and children with families who loved them. They loved and were loved, trying to live the best way they could.

My question to the Minister is not a simple one. How do we know that such a culture has changed and how to we monitor such things? The regulator and the Government are holding Kensington and Chelsea’s feet to the fire on its recovery programmes, but how is this being done? Can the Minister write to me, as this is an important check and balance in the system and is probably quite detailed for an answer at the end of the debate?

In conclusion, the report is very detailed, and it has many wide-reaching recommendations, which is why I have chosen to concentrate on one bigger issue. There is stuff about emergency planning: they were ill prepared. There is stuff on building control: has competition worked, or should it be taken out of councils’ hands? There is stuff about remediating buildings: why is the amount of money available considerably less for social housing providers than private owners? Is height an inadequate measure of risk? Should the definition of a “high-risk building” be reviewed? But I have chosen just the one overarching major issue, knowing full well that other noble Lords will seek to get answers to those questions and many more. I look forward to their contributions.

I am sure the Minister will agree with my final comment that the report raises fundamental questions about societal attitudes to social housing and its tenants. The report highlights that systematic neglect and a lack of investment in social housing contributed to the tragedy. Residents felt marginalised and their concerns about safety were ignored. This aspect of the disaster underscored broader issues of inequality and neglect in housing policy. How will this Government seek to change that?

Social Housing: Awaab’s Law

Baroness Thornhill Excerpts

Tuesday 22nd October 2024 Lords Chamber

[Lord Khan of Burnley (Lab)]

On enforcement, seeking redress is important and tenants should challenge their landlords, whether it is a private landlord or the social housing sector. There are important ways to address this through the courts, but there is also the Housing Ombudsman. Tenants can challenge their landlord and if they do not get a satisfactory response, the Housing Ombudsman can address the issue, whether it is in the private or social sector. The noble Lord makes a valid point about the problems being widespread and not just in the private rented sector.

[Baroness Thornhill (LD)]

My Lords, only last week, the Housing Ombudsman said that damp and mould complaints constitute half of all its complaints. It named and shamed 20 social housing providers to which it had served severe maladministration orders. It is clear to me that the sector is already struggling with the timescales involved in Awaab’s law. Can the Minister assure us that all parties are ready for this? Following the comments made about speed, does he agree with me that new legislation is valuable only if it is enforceable? If it will not work, and if the sector is already struggling to make it work, do we not need to listen to the sector for a little longer before extending this legislation to the private rented sector?

[Lord Khan of Burnley (Lab)]

My Lords, we are working with social landlord and tenant groups to consider the practical implications of the proposed requirements to be set through Awaab’s law. The Government’s response to the consultation, which will be published in due course, as well as subsequent regulations, will provide details on how Awaab’s law will work. We will issue guidance for landlords and residents on the new duties to be set by the regulations. The guidance will be published before the regulations come into force, to give landlords time to prepare and for tenants to know their rights.

Housing: Modern Methods of Construction

Baroness Thornhill Excerpts

Thursday 5th September 2024 Lords Chamber

[Baroness Thornhill (LD)]

My Lords, I say at the outset that I am really grateful that, yesterday, the Government Whips’ Office gave the winders some extra time, but I feel that two minutes for a speech is not making use of the expertise in this Chamber. That said, all the two-minute contributions have been insightful and informative and have, amazingly, captured all the issues around modern methods of construction—and the debate has definitely bounced along. What is striking is that there is a consensus that there is a role for modern construction and agreement about the challenges and barriers to MMC but plenty of suggestions for improvement, which I hope the Minister will take back to her department.

I, too, was a member of the Built Environment Select Committee, which carried out the inquiry, ably chaired by the noble Lord, Lord Moylan, whose contribution it is a pleasure to follow today. It was a wide-ranging, if frustrating, inquiry, as the noble Lord, Lord Carrington, accurately outlined.

It was not that the Government were not putting money into tackling the problem—our usual complaint—but that they had done so in an undirected and haphazard way without a coherent strategy and measurable outcomes, although I am certain that the noble Baroness, Lady Scott, will put up a spirited and informed defence of the previous Government’s advances in modular build, and I genuinely look forward to her contribution.

I turn to the consensus that we have a housing crisis and that modular build could and should be a way to build more homes, more quickly and, more importantly, to the future homes standard. It will add diversity to provision, which is at present monopolised by the big builders.

The number one issue for the industry is the supply chain, which was mentioned by several noble Lords. There are clearly real issues of business survival when you have inconsistent and insufficient demand for your product, unpredictable delays and workforce challenges. In this climate, we have unfortunately had recent experiences of companies going out of business or struggling to continue in business. I really have only one question for the Minister: what is going to change and what plans do the Government have? Will they consider incentivising builders to use MMC by offering tax breaks, reducing VAT on modular homes, or giving tax credits to companies that invest in modular construction? We hear excellent mood music from the Deputy Prime Minister about a revolution in social housing. Will the Government consider setting targets for the construction of modular homes within public housing projects? Will the Government actively use their own land as part of a deal to create more public/private partnerships to build more modular homes and encourage and incentivise councils to do likewise?

The regulatory framework mentioned by the noble Lord, Lord Banner, and others is designed with traditional construction methods in mind, making it more difficult for MMC builders to navigate the approvals process. The regulatory maze can deter builders from opting for modular approaches, even when they might wish to use them. This applies particularly to SME builders. Could the Government consider a fast-track approval process for modular housing developments to encourage quicker construction? Creating a streamlined process aided by national policies specifically for modular homes, as mentioned by a noble Lord—I apologise for forgetting his name—would encourage plans to come forward, reduce delays and overcome the bureaucratic hurdles that are currently faced.

As we heard in the contributions by my noble friends Lord Teverson and Lady Brinton, we feel that the Government should use the future homes standard to ensure that modular-built homes are built to high environmental and safety standards and provide for more lifetime M4(2) homes. In that regard, we disagree with the remarks of the noble Lord, Lord Fuller, about building to a lower quality.

There is some disagreement about the overall costs of MMC build versus traditional build but from the perspective of housing associations, which was touched on by the noble Baroness, Lady Warwick of Undercliffe, the upfront costs are more expensive than traditional build. The upfront costs are more pertinent to housing associations than the lifetime costs as they are under considerable financial pressure now and, regrettably, environmental standards are often reduced to keep costs down. Additionally, as more accessible homes take a larger floor plan you get fewer homes for your money, a realistic dilemma that targeted grants could help to solve.

As the noble Lords, Lord Rooker and Lord Best, pointed out, there is a skills shortage in construction in general and in MMC specifically. The skill sets and technological challenges are different. The Government should encourage more investment in research and development in MMC technologies to improve efficiency, reduce costs and enhance design options. There are still too many stories of poor construction and construction failure. As we know, this does not need to be the case; we can only envy my noble friend Lord Thomas’s tenants. The risk aversion of warranty and insurance providers plus the reluctance of lenders to provide mortgages on homes built by MMC are further barriers. These issues need unpacking and only the Government can do that and offer strong clear guidance about what will be expected in future.

Finally, to make this shift needs radical change, and the current system is not being sufficiently incentivised to change. We have a risk-averse culture and are cautious in trying new methods. Therefore, the Government have a real role in being the driving force for change. I do not think we can wait for demands from clients and homeowners because for me the other significant barrier, mentioned by the noble Baroness, Lady Wheatcroft, and my noble friend Lady Miller, is public perception and the stigma left over from the prefabricated homes of the past. I remember visiting my Auntie Marion’s prefab in Tenby, south Wales. She lived in it happily until she was forcibly evicted. These two things—cautiousness and public stigma—act as barricades to change.

It seems from the debate that MMC is part of the housing crisis solution, but nobody is dewy-eyed about this. It is certainly not a silver bullet. It could contribute significantly but it needs political will and leadership to create a whole-market approach to ensure that consumers, manufacturers and lenders are all aligned in their aim of embracing MMC to create sufficient demand in the market to grow the approach. Without this alignment and subsequent demand there is no clear catalyst to drive the change needed. Will the Government provide that catalyst and be the ringmaster? If the answer is yes, how and when?

Lease Extension Policies for Residential Properties

Baroness Thornhill Excerpts

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.

Building Homes

Baroness Thornhill Excerpts

Tuesday 30th July 2024 Lords Chamber

[Baroness Scott of Bybrook (Con)]

My Lords, I first add our condolences to the community of Southport after the horrific incident yesterday. Our thoughts and prayers go out to the friends and families of all those who have been affected.

We on these Benches support policies to provide more housing in this country, particularly affordable and social housing. Our previous Conservative Government fulfilled their commitment to build over 1 million homes over the previous Parliament and 2.5 million homes since 2010, but targets do not ensure that homes are delivered and I do not see that any of the changes announced today will aid any delivery.

Our last Government put £11.5 billion into the affordable homes programme, delivering 700,000 more homes. What will this Government invest to build more homes, or will homes suffer the same fate as hospitals and transport, with no investment? Compare this with the previous Labour Government, where construction slowed to the worst peacetime housebuilding rates since 1924. Let us hope that this Labour Government will invest and deliver, and not just produce targets.

How will the Government deal with communities having a say over what homes are built in their area? The Prime Minister admitted on Radio 4 that he will ignore local councils, but the Secretary of State for MHCLG and the Chancellor have both tried to stop developments in their own constituencies. What will Labour’s policy be? So many questions.

The levelling up Act simplified local plans to work with local communities on the housing and infrastructure needed in their areas. Will the Government continue to support local plans and what exactly will they do if a local council does not produce a local plan or produces one with too few homes? If combined authorities are to be responsible for strategic plans of housing growth in their area, how is this devolving power to communities? Surely this is just adding another tier of bureaucracy. Will this not once again slow down the system, adding complexity between conflicting strategies? Noble Lords have only to look at Mayor Khan’s London plan and what that has not delivered for our great capital city.

Labour’s top-down green belt review seems to go much further than grey belt. The NPPF already allows for brownfield site development in green belts, for example of redundant car parks, petrol stations et cetera, so how far will Labour’s changes to green belt policy go? Will farmland be included in the top-down review? How long will that review take? Will there be any national or local consultation? Once again, we see a slowing down of the housing delivery system.

Before I finish, I go back to nutrient neutrality. Some 160,000 homes in this country cannot be delivered —homes for young people, families and older people trying to downsize. These are not large developments, but one or two houses here and there, quite often across a rural landscape. Will the Government take another look at this?

So many changes, so much consultation, so much extra time in the system—it seems to be a field day for the Planning Inspectorate to go out and look again and again and again.

I am confident that the whole House wants more good-quality homes in places where they are required. What I am not sure about is whether this Government’s policy changes will deliver that, but what I can assure the noble Baroness opposite is that we will work with them to deliver where it is right to do so, but we will challenge them where we believe it is not.

[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.

Spending Commitments to Local Councils

Baroness Thornhill Excerpts

Monday 22nd July 2024 Lords Chamber

Asked by

[Baroness Thornhill]

To ask His Majesty’s Government whether they intend to review existing spending commitments made to local councils.

[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.

Leaseholders: Management Companies

Baroness Thornhill Excerpts

Monday 20th May 2024 Lords Chamber

[Baroness Scott of Bybrook (Con)]

My Lords, the Government welcome the ongoing work being undertaken by the industry, and thank the noble Baroness, Lady Hayter, for the work she has done with her group on codes of practice. We have said that we will consider any code produced by her steering group, and come back to the House.

[Baroness Thornhill (LD)]

My Lords, the Competition and Markets Authority, in a recent report, was very concerned about the increasing practice of major housebuilders charging all the residents on new estates for common amenities such as roads, lighting and playgrounds, services traditionally provided by local authorities and paid for by council tax. Is the Minister confident that the measures in the Bill will ensure that prospective residents will be aware of the way that their new estate will be managed and the actual costs and services they will have to pay for before they buy? Does she agree with me that there is little justification for these residents to have to pay twice?

[Baroness Scott of Bybrook (Con)]

Through the Leasehold and Freehold Reform Bill the Government are legislating to make sure that freehold home owners who pay estate rent charges have the right to challenge the reasonableness, and to go to a tribunal to appoint a manager to manage the provision of those services, along with the transparency that they will also have in those charges. We are also carefully considering the response to and the recommendations of the CMA report published in February.

Renters (Reform) Bill

Baroness Thornhill Excerpts

2nd reading
Wednesday 15th May 2024 Lords Chamber

[Baroness Thornhill (LD)]

I declare my interest as a member of the cohort of Local Government Association vice-presidents. This has been an interesting, informed and wide-ranging debate. Noble Lords have shown their different expertise, in the time-honoured tradition of this Chamber. It is clear that the Bill has given us all food for thought and that we will have our work cut out during its passage. It is also clear that noble Lords have some serious concerns and that views are somewhat polarised.

The state of the private rented sector was clearly outlined by the noble Lords, Lord Best and Lord Truscott, and the noble and learned Lord, Lord Etherton, so noble Lords will be pleased to know that I will not go into detail. But the bottom line is clear: there is a significant shortfall in the availability of homes for private rent. Rightmove data—nobody has quoted this, so I will go with it—tells us that the number of available rental properties is 26% below 2019 levels, and the number of people looking for a rental home is 54% above 2019 levels. Staggeringly, some 50,000 properties are needed to bring the supply back up to pre-pandemic levels. Yet, at the same time, agents are receiving three times as many inquiries about every home available to rent. This leads to a rationing of a scarce and precious resource, which one agent described to me recently as a “beauty parade”. Landlords can now pick the best tenants—and we all know who they are and, more importantly, who they are not.

As my noble friend Lady Pinnock and the noble Lord, Lord Best, said passionately, the real issue at the heart of this shortage is the lack of homes for social rent. What is noticeable about all the charities lobbying us about the Bill is their commendable protection of the most vulnerable in society: the elderly, those suffering domestic abuse, families on low incomes and those who need additional support to get and keep their lives on track, as well as, lately, students, who clearly feel that the Bill turns them into second-rate tenants denied the rights of other tenants. Excepting students, 10 or 15 years ago all those groups of people would have been living in social housing, with a landlord who would give them not only stability through security of tenure but additional support if needed.

Let us turn to the detail of the Bill. This is a selective gallop around the course to show our areas of concern on these Benches, and where we will be working across the House to try to persuade the Government to make some changes. To the Minister I would say, while I acknowledge that there are good aspects, and some very good aspects, I shall not be mentioning those.

The big one is the non-abolition of Section 21, which is the cruellest and biggest disappointment in the Bill for some of us, for sure. So much has already been said most ably by the right reverend Prelate the Bishop of Chelmsford, the noble Baroness, Lady Taylor, and others. We know that Citizens Advice has seen significant increases in those seeking help with Section 21 evictions and facing homelessness, and that the numbers being served Section 21 notices have risen. We know that the number of families in temporary accommodation is rising month on month, and that those costs are spiralling, causing serious issues with the budgets of some councils. Of course, this has ultimately led to an increase in the number of homeless people on our streets. On what basis is that delay truly justified? We will be seeking to ensure that the Government put a date for ending Section 21 in the Bill, which should be no later than six months after Royal Assent. That is optimistic, you might say. Perhaps, but there is hope. We welcome the Labour Party’s announcement that it would introduce this on its first day in government.

The new tenancy regime was broadly welcomed by all stakeholders when the Bill was introduced in the other place, but I note today that the debate on the abolition of fixed-term tenancies will certainly exercise us in Committee. However, we have concerns about the government amendment whereby tenants cannot give notice until they have been in the property for four months. We understand that landlords will want to know that they get six months from each tenancy and, as the noble Lord opposite said, that tenants will want security. But things happen and circumstances change, and sometimes the property is not all that it should be.

It is worth pointing out that the present market conditions and the stresses of finding and funding a tenancy mean that a tenant will not usually give notice unless something is seriously wrong, either with the property or with themselves or their family. Most renters want that security of tenure, so they do not want to move unless forced to, as it costs them, as the noble Baroness, Lady Taylor, said, around £1,700, according to figures from Generation Rent. We believe that it should be possible to make compassionate exceptions in cases of fleeing domestic violence, or illness or death, for example, as mentioned by several noble Lords. I was heartened by the Minister’s comments in her introduction.

In lieu of the abolition of Section 21, Section 8 will contain the grounds for terminating a tenancy, and those grounds have been extended in the Bill. We have concerns, particularly about grounds 1 and 1A, and landlords evicting a tenant if they wish to move one of their family into the home or sell it. Both are entirely reasonable scenarios, but the Bill as it stands means that a tenant can be out after six months. We would seek to extend that period, I hope to a year. We are concerned that these two grounds will be used in much the same way as Section 21, because of the very low burden of proof on the landlord. Who do we think will be checking that the home is sold, or that a family member has moved in? What will be in place to prevent landlords gaming the system? We will support amendments requiring landlords to prove the use of those grounds. We note that the Bill provides for a three-month ban on landlords letting the property following the use of these grounds, but that simply is not long enough to disincentivise its use.

Whether the Government will agree to a longer protected period or not, we believe that the notice period for eviction under grounds 1 and 1A should be extended to at least four months to give a little more time to sort a new place to live. Shelter has said that, under the present circumstances, it takes 40% of renters with families longer than two months to find a home. We fear that, without this extension, even more renters will be forced into homelessness—so the burden on councils increases, not to mention the very human cost. I remind the House of the letters signed by more than 100 council leaders asking for a similar extension period because of the rising costs of temporary accommodation and the lack of suitable properties. We hope the Government will think again on this.

Unfortunately, the dire situation in the courts, as very well amplified by the noble Lord, Lord Adonis, has led to this back-pedalling. It is true that the length of time a landlord currently waits to get a court hearing varies, with the mean time being seven months. We agree that this is far too long, but we do not accept that this should lead to a delay in abolishing Section 21; rather, the Government must and should be investing in the courts and, in particular, housing legal aid. The situation regarding access to legal aid is particularly poor in rural areas. The Law Society has drawn attention to this, stating that almost 44% of the population of England and Wales do not have a housing legal aid provider in their area.

We are concerned that, while the Bill seeks to introduce stronger powers to evict anti-social tenants who are persistently disruptive—we completely agree with that—the definitions are not suitably defined and appear too subjective or open to abuse. There are also serious issues regarding victims of domestic abuse where such abuse is regularly mistaken and reported as ASB. These need to be listened to and taken seriously. We cannot just ignore the unintended consequences of this Bill on such a group—remembering that, on average, two women a week are killed by a former or current partner. On this, I agree with much of what the noble Baroness, Lady Lister of Burtersett, said in her excellent contribution.

It is good to see that the Bill will make it illegal to have blanket bans on renting to tenants on benefits and those with children. Let me say to the noble Lord opposite, I do not see what is in this Bill that could possibly make a landlord not want to rent to a family. Perhaps he can explain it to me afterwards.

[Lord Cromwell (CB)]

I would be happy to speak to the noble Baroness afterwards.

[Baroness Thornhill (LD)]

This will hopefully end that discrimination towards—yet again—the most vulnerable.

We would, however, urge the Government to look at several other practices where discrimination occurs. If a landlord insists on several months’ rent up front—and they do—that disadvantages many people for obvious reasons. Likewise, on the use of a guarantor, not everyone has family or friends willing or able to act as a guarantor. Both these measures in effect marginalise the less well off.

On rent rises, we feel that the Bill does not go far enough. The proposed annual limit of one rent rise is positive, but it still gives no guarantee as to how much the rent could rise, and the process to challenge an unfair rent rise is complex and lengthy. I was concerned by the statement that tenants could find themselves in a position where the First-tier Tribunal could say that the rent is worth more. That felt like a bit of a veiled threat that this would act as a deterrent to challenge a rent rise. Surely, to link increases to CPI or median wage growth would be fairer and transparent, and would obviate the need to appeal to the First-tier Tribunal at all.

We cannot escape the fact that the real issue is lack of supply. We know that much supply has been lost to short-term lets, which was expanded on very well by the noble Lord, Lord Truscott. There are no incentives in this Bill for landlords to return to long-term rentals—as opposed to the damaging overprovision, in some areas such as Cornwall, Cumbria and other tourist spots, of the more lucrative Airbnb. These should include making the playing field level between the two tenures using taxation, regulation and health and safety requirements.

There is much more to say and time to say it in detail at later stages, but I end by reinforcing the words from my noble friend Lady Pinnock and others regarding the role of local authorities in making this Bill work. As things stand now, they cannot do the job that we or they want them to do. These additional demands will only make things worse. The fact that the Bill—at last—expects the private rented sector to meet the decent homes standard and has given some additional powers to councils will come to nothing without the resources to do the job properly. Likewise, extending the homeless duty on councils sounds admirable, but some councils are barely coping now.

Finally, we do not feel that the Bill as it stands has rebalanced the relationship between landlord and tenant. It still feels to us like the landlords have the upper hand, which is perhaps why, in their briefing, they wish to see the Bill passed as soon as possible, and why the Renters Reform Coalition has branded it a failure.

Leasehold and Freehold Reform Bill

Baroness Thornhill Excerpts

Committee stage
Wednesday 1st May 2024 Lords Chamber

[Lord Khan of Burnley (Lab)]

My Lords, I will speak to Amendment 92 on behalf of my noble friend Lady Taylor of Stevenage. This new clause would ensure that leases on new flats included a requirement to establish and operate a residents’ management company responsible for all service charge matters, with each leaseholder given a share. The amendment has dual purposes. It would remedy two significant current flaws in the leasehold system that the Bill does not address, and it would provide a step forward to commonhold, without doing so in a piecemeal way.

I turn to the current flaws. First, unless leaseholders in blocks of flats acquire the right to manage, collectively enfranchise and then establish a residents’ management company, or buy a property in a development where a residents’ management company has already been set up, they have no control whatever over how their money is spent. This is despite having to pay all the costs to maintain and manage their buildings. Secondly, the rights that leaseholders do have to exercise control over how their buildings are managed—whether through a tribunal, the appointment of a manager or the right to manage—are locked behind difficult and often costly legal processes to which many will not have access.

Our amendment would address both these problems by requiring that when a new residential block of flats was constructed and its units sold the development should be a three-way lease between the freeholder, the leaseholder and the new residents’ management company. Each leaseholder in the block would then own a share of the residents’ management company, and it would be under their exclusive control, giving them full responsibility for services, repairs, maintenance, improvements, insurance and the cost of managing their building. This would give them control over how their money was spent. This ability to influence the management of their building would come at no additional cost.

The Minister will no doubt say that our amendment leaves no space either for limited cases in which a mandatory residents’ management company is not appropriate or where leaseholders simply do not want this responsibility. The Government have said many times that they are keen to give more home owners control over the management of their buildings, and we welcome that the Bill is moving in the right direction. Would it not make sense to have leaseholder management of their buildings to be the default?

Where mandatory residents’ management companies are not appropriate, could the Government not put forward such cases to be incorporated as exceptions? In the case of leaseholders not wanting to be compelled to manage their buildings, could there not be a provision for leaseholders to use the power of the management company to appoint a manager or simply return management to the freeholder? I would be keen to hear the Minister’s thoughts on these alternative options.

The real importance of this clause, however, comes from it being a key way of laying the groundwork for a future where commonhold is the default and leasehold becomes obsolete. It would help to create a cohort of leaseholders who have experience in running their buildings, as they would under a commonhold arrangement, even if that experience is limited both in time and the extent to which they have carried it out.

This is certainly not a perfect solution. It would do little for leaseholders who have already purchased their flats and do not currently have a residents’ management company. We need other solutions, building on measures already in the Bill to address the challenges they will continue to face. I look forward to the Minister’s response and beg to move Amendment 92.

[Baroness Thornhill (LD)]

My Lords, I support Amendment 92 in the name of the noble Baroness, Lady Taylor of Stevenage, and explained so well by the noble Lord, Lord Khan of Burnley. The right to manage was first introduced in the leasehold reform Act of 2002. From the start, it was, as the noble Lord said, intended as a simple and cost-effective alternative to collective enfranchisement, but, despite the happy intentions of that Act, the reality was quite different. Take-up has not been what we would all have hoped for or expected, because the right to manage has proved incredibly problematic in practice.

These problems culminated in the Law Commission’s final report in 2020—time has marched on—on exercising the right to manage. It summarises the difficulties as follows:

“The ‘simple’ RTM process envisaged in the original consultation which led to the 2002 Act has not come to pass. The requirement for strict compliance with the statutory procedures, such as the service of certain notices on particular parties, can be unforgiving to leaseholders. In many cases, small mistakes made by the RTM company have afforded landlords opportunities to frustrate or delay otherwise valid claims. The Court of Appeal has noted that while the procedures ‘should be as simple as possible to reduce the potential for challenges by an obstructive landlord’, in fact they ‘contain traps for the unwary’”.


This is not a good advert for anyone seeking to exercise the right to manage, which we believe is fundamental to the change we need. The Law Commission subsequently made 101 recommendations, of which the then Government adopted two.

Whole swathes of actions could be happening to make this process simpler and to encourage residents to take this up. We have no doubt that the process is not an easy one and that the provisions in the Bill as it stands are actually quite limited. The uplift from 25% to 50% is welcome, as are the beneficial changes in cost provision, and minor changes to courts and tribunals. They are all positive but underwhelming—a far cry from the 101 recommendations.

In debates throughout the course of the Bill we have heard numerous instances of excessive charges and unfair practices, from both Houses. The Law Commission summed it up best when it said that

“the landlord and leaseholder have opposing financial interests—generally speaking, any financial gain for the landlord will be at the expense of the leaseholder, and vice versa …Their interests are diametrically opposed, and consensus will be impossible to achieve”.

This amendment is quite realistic: it is starting only with new build, but what it does is symbolic, in that it draws a line under the past and clearly points the way forward. Noble Lords will notice that I am not wearing rose-coloured spectacles, and we are not saying that the residents’ right to manage will be any easier—but it will be fairer. Those paying the bills control the bills and can remove any poorly performing providers. We believe that a leaseholder-controlled resident management company with an elected board, accountable to all leaseholders, is a far more democratic arrangement than one middleman freeholder controlling block management, spending leaseholders’ money freely and not involving them in the decision-making processes. It is fundamentally a better way to go, and there seems to be widespread support for it.

We support this amendment because we believe that it is a step in the right direction and could reinvigorate right to manage with the right support. It seems that the Government are finding reasons not to do something instead of working to enable something better to happen.

[Lord Gascoigne (Con)]

My Lords, I thank the noble Lord, Lord Khan of Burnley, for speaking to Amendment 92 in the name of the noble Baroness, Lady Taylor of Stevenage, and I am grateful for both contributions in this brief discussion.

The amendment seeks to require the establishment of leaseholder-owned management companies for all leasehold flats. I understand the intention to ensure that, by default, all leaseholders of new flats would be responsible for the management of their buildings. The Government support the desire to give more home owners control over the management of their buildings. This Bill is intended to do just that, and will make it cheaper and easier for more leaseholders to own and manage their homes should they wish to.

In some cases, developers have voluntarily set up residents’ management companies to transfer management responsibility to leaseholders. We welcome this, and encourage the industry to adopt this model where appropriate. However, we believe that the best way in which to achieve resident-led management for new buildings is not for government to mandate change to leasehold but to reinvigorate and improve the uptake of commonhold. Commonhold does not require involvement from a third party.

We will reinvigorate commonhold so that it is a genuine alternative to leasehold for new flats. However, there are limitations in the current legal design of commonhold which can limit its use in some settings. We must get any changes right, and preparing the market for the widespread uptake of commonhold will take time. Existing leaseholders can already use the right to manage to take over management responsibility for their building. This is an established, no-fault right that allows leaseholders to take over management responsibility when a majority of leaseholders wish to do so.

There are some situations where the right to manage is not available because leaseholder-led management is not considered appropriate—for example, in largely commercial buildings or where there are social tenants. We believe that it would not be appropriate to apply a blanket provision requiring residents’ management companies for all new buildings without considering where equivalent protections should apply.

Further practical challenges include determining at what point during development and the sale of units management responsibility would be transferred; what position the freeholder would have in the management company if they retained non-residential units or those on short leases; and what protections would be required should leaseholders not wish to take up management responsibilities. Answering these questions would require significant additional consideration—consideration that is ultimately unnecessary because a reinvigorated commonhold is the answer for new buildings, and the right to manage for existing leaseholders makes sure that home owners can already control the management of their building.

--- Later in debate ---

The electrical engineers tell me, and Mr Watts wrote, that one reason that training and guidance have been poor is the “economical compromise” by industry stakeholders. There we have it. The small number of NCDs means that the DNO and HSE keep quiet and pay up when they occur—but what about the hundreds of thousands of people living in these unprotected high-rise blocks? Leaving aside the cladding and delays—it must be done quickly—they are vulnerable to neutral current diversions. Nobody knows, nobody is testing and nobody is checking—well, I think they should be testing and checking.

[Baroness Thornhill (LD)]

My Lords, before I get into the detail of these amendments, I will comment on some significant absences from our Benches. First, my noble friend Lady Pinnock is up for re-election tomorrow. She has been a passionate and doughty fighter from the beginning and throughout this tragic journey.

The second absence, as has already been mentioned, is due to the recent shocking death of Lord Stunell. His expertise and attention to detail, often peppered with a gentle sense of humour, were a perfect foil to my noble friend Lady Pinnock: they worked well together. We have missed him significantly during the passage of this Bill; I am truly a poor sub from the bench.

In truth, the significant contributions from the noble Earl, Lord Lytton, and the noble Lord, Lord Young of Cookham, are grounded in solid evidence and reality. We support and endorse them and I have no intention of going anywhere near the detail that they described. I admit openly that I have learned a lot.

All the amendments in this group relate to building safety and to the fallout of the Building Safety Bill and the gaps that were created as a result of it. Noble Lords have outlined them very well and I am certain that the noble Baroness, Lady Taylor, will too.

After the tragic events at Grenfell Tower in 2017, in which 72 people lost their lives, it became clear that millions of leaseholders would need to make their buildings safe and habitable. The campaign group End Our Cladding Scandal—some of its members are here today—estimates that as many as 3 million leaseholders are caught up in the scandal. That is a huge number of families and people and, if you think of the people who they know, care for and love, you will be talking about considerably more.

The Building Safety Act sought to protect leaseholders from the cost of remediating these safety defects but, as has been amplified, the scheme has a glaring issue: a huge number of affected leaseholders are not included. We support the amendments that are clearly designed to widen that pool—if we do not just say “Let’s do the whole caboodle”.

Estimates included in a briefing from the National Residential Landlords Association suggest that there are approximately 1.3 million leaseholders of buildings less than 11 metres in height who are not able to qualify for support. This is in addition to the 400,000 leaseholders in high-rise buildings who are non-qualifying due to other eligibility criteria, such as, as has been mentioned, the enfranchised leaseholders and leaseholders owning more than three flats. On learning about that a little bit more, it seems to me that this is a travesty. As has been stated by others, these leaseholders are facing eye-watering sums and many are living in unsafe buildings that are unmortgageable, uninsurable and unsellable. That they have been abandoned is unconscionable.

Amendments 93B, 96, 97, 99, 100, 105 and 107 seek, in different ways, to expand the number of leaseholders eligible for remediation support. This is the right thing to do. It is also obvious that some small adjustments can be made to make things better for more: for example, simply looking at the wealth—what is known as the affordability test—or the issues of joint ownership.

Amendment 93B, tabled the noble Earl, Lord Lytton, is very clear that only a building remediation scheme will ensure that all buildings with safety defects undergo remediation, irrespective of ownership or building height. We agree with that. Too many people are falling through the gaps that have emerged post the Building Safety Act. Insurance has already been mentioned, so I will not make any more comments on that.

It seems to us that the pragmatic Amendments 96, 97, 99 and 100 from the noble Lord, Lord Young of Cookham, are arguably the neatest way of achieving this aim. They simply amend the Building Safety Act so that these non-qualifying leaseholders are included in the support available to other leaseholders.

Amendment 102, in the name of my noble friend Lady Pinnock, would require the Government to report on progress relating to the building safety remediation. I am sure that she would probably agree with the comments made by the right reverend Prelate. This amendment was drafted in response to concerns raised by End Our Cladding Scandal, namely the speed at which remediation is occurring, alongside the progress in ensuring that leaseholders have access to a robust and independent dispute resolution process, and the fact that not all affected leaseholders are able to access protection.

I note that the Government publish monthly figures relating to the remediation of building safety defects, but there is no clear target for when these works should be completed. It would be appreciated if the Minister could perhaps clarify this. I am reminded of the saying that you do not fatten a pig by simply weighing it. To us, the lack of speed or a plan or any sense of urgency is clearly the impetus behind the amendments from the noble Earl, Lord Lytton. It seems that no one is holding anyone’s feet to the fire.

The Government also promised a robust and independent resolution process that would allow leaseholders to challenge building assessments or remediation. This has arguably not come to pass, with the process being more ad hoc and without sufficient leaseholder representation. It is vital that leaseholders are able to hold developers to account and ensure that remediation is completed safely, in a timely manner and at good value, but they need more government clout.

There was something mentioned only briefly that I would like to expand on a little. It seems to me that developers are getting all the flak. We all agree that lease- holders are blameless, but developers are not the only party to blame. Many of us still need to be brought to the table, preferably with cash, to provide the funding that will fix the problem. I am talking about product manufacturers, architects and designers, contractors, building control, testing houses and insurers. They all have a part to play and they should all play their part.

I suspect that, when the Grenfell Tower Inquiry reports later this year, the role that successive Governments, to be fair, have played will also be unavoidable. We feel that it is time that the Government really stepped up and gripped this problem comprehensively. They are the ringmaster, after all.

[Lord Empey (UUP)]

I am most grateful to the noble Baroness for giving way. She mentioned a list of people who had a degree of responsibility. One of them, of course, is building control. My experience of building control in local authorities is that they can be extremely pernickety and difficult, and can enforce very high standards. All of us, in our different cities, will have seen examples of absolutely grotesque omissions and failures. But is it not the case that a local authority has a statutory liability, through building control, and that that, in and of itself, could and should be a source of remedy for a person who finds themselves in this position? On top of that, is there not an incentive for a developer, having built a structure and sold on the units, to wind up and move on to a different company to build the next one? We end up with people slipping out of the net entirely.

[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.

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP)]

My Lords, I rise briefly to offer Green support for this clear, obvious and essential amendment, which already has strong support across the Committee.

I want to pick up a point made by the noble Baroness, Lady Hayter, about how both buyers and sellers desperately need confidence and how that confidence is utterly lacking at the moment. A lot of our discussion has focused on the problem of estate management, where there are clear and obviously pressing problems, but to focus a little on sales of properties and the need for some oversight there, I note that, last year, trading standards warned that many agents were not passing on the best offers that they had received from purchasers, as they are legally required to do, because they were getting commission fees from mortgage brokers, solicitors, surveyors and other third parties. They were choosing to go with what would produce a better result for them but a lower price for the seller. The only way that this is generally uncovered is if the would-be buyer who did not succeed in purchasing the property happens to look at the Land Registry sales price, says “but that’s less than I was offered” and creates a fuss. That is a sign of just how utterly cowboy the current situation is without regulation.

A report out yesterday noted that for 34% of the “for sale” stock on some major websites there had been an asking price reduction. People often need to sell for all kinds of reasons—including divorce, bereavement or perhaps because they need more bedrooms for extra children. These are all stressful, difficult situations where delays can cause damage and create uncertainty. We have a cowboy situation out there, and as the noble Baroness, Lady Hayter, said, the people in the industry who want to do the right thing know that there are cowboys out there who are a threat to them. Therefore, the amendment is clearly essential to making our housing sector less of a cowboy environment than it is now.

[Baroness Thornhill (LD)]

My Lords, I too support Amendment 94 in the name of the noble Lord, Lord Best, which was so well outlined by him with his usual clarity and reason. It is an amendment that I was determined to put my name to, but its popularity was such that I was too late. However, I listened intently to the informed contributions from the noble Baroness, Lady Hayter, and the noble Lord, Lord Young of Cookham, and look forward to the contribution of the noble Baroness, Lady Taylor. This will therefore be possibly my shortest and easiest contribution to the Bill, simply saying that, between them, the proposers have nailed this issue with an amendment that should be workable and which we hope that they will take forward on Report.

The noble Lord, Lord Best, listed the broad coalition of support for a regulator and indeed it appears that it is ready to go. This is something which the noble Lord has campaigned on for years. His report was widely accepted and praised for its thoroughness and its remarkably workable plan for the way forward, which he has stated in detail. Interestingly, the recommendations of his working group went much further than this amendment, so the movers of the amendment are being pragmatic and measured because they want to see change now—we support that.

I found the contribution of the noble Lord, Lord Truscott, on redress, particularly interesting. It reminded us that, currently, regulation in the property sector is voluntary and sanctions are limited. This Bill will not change that enough. Do your Lordships not think it is shocking that anyone can set up a firm from their bedroom and very soon be handling hundreds of thousands of pounds of leaseholders’ and taxpayers’ money while being largely unaccountable to the leaseholders who, on the whole, do not choose them to manage their block or control their service charges? This cannot be right. An individual can set up in business as a property manager without any formal qualifications, experience or even insurance.

It seems shocking that there has been so much good legislation to protect much smaller sums, such as deposits for renters, but nothing to protect leaseholders’ funds. We have regulations and regulators for individuals and companies handling much smaller amounts of people’s money. Leaseholders are usually required by the terms of their lease to make advance payments towards the service charge and to contribute to a sinking fund or reserve fund. These sums can be substantial, especially if major works are planned, which is why we supported the amendment tabled by the noble Baroness, Lady Fox, earlier in the Bill on consultation on major works. The Federation of Private Residents’ Associations has asserted that there is no other area in the UK in which money is held by a third party that is not regulated—unless somebody can tell me otherwise. The federation suggests that moneys held by unregulated and unprotected third parties may well exceed £1 billion.

If we want to change the behaviour of such property agents, there needs to be a much more professional approach to training and development, as the noble Baroness, Lady Hayter, exemplified well. Mandatory professional standards should be set, along with the oven-ready code of practice.

Even within the sector, the good guys—and there are good ones—do not want the rogues giving them a bad name and tarring everyone with the same brush. It is clear that the Government are procrastinating on this issue, so much so that several years after the report from the noble Lord, Lord Best, very little has happened. The fact that the Government have not taken the opportunity with this Bill to introduce relevant property agent regulations proves that they have probably yielded to the anti-regulation voices among their ranks, despite their acceptance in principle of the case for regulating property agents, which has also been accepted by the majority of interested and affected parties. We are all seeking a solution, and Amendment 94 is certainly worthy of consideration, and we urge the Government to give it that consideration. I look forward to the Minister’s reply and to Report, definitely.

[Lord Thurlow (CB)]

My Lords, I have not heard a voice in the Chamber this afternoon against the amendment from the noble Lord, Lord Best. It is such a refreshing amendment, it is long awaited, and we have heard, and we all knew, that his report was kicked into the long grass many years ago by the Government, and that is something of a disgrace. Even in the Levelling- up and Regeneration Bill debates last year, this subject was much discussed. We must not overlook that large cohort of hugely responsible and professional property managers—and there are many—but our focus must be on those who fail to adopt high standards, those who knowingly overcharge, those who take discreet commissions, and those in the pockets of clients with dubious standards.

This subject of rogue managing agents has come up again and again in this Bill; the time has come to act. The amendment clearly has strong cross-party support, and we have heard that the Government want to do it in principle. If the Government really want to do something for leasehold occupiers, this is it: simple regulation of property managing agents and other related property advisers; no one to practise without registration; a no-nonsense, strictly monitored and enforced system of effective supervision; and a simple, advertised complaints procedure for the lessees and rigorous monitoring of those complaints. This amendment has my wholehearted support. I hope the Government will adopt it; if not, I hope it is pressed on Report.