Leasehold and Freehold Reform Bill

Lord Adonis Excerpts

2nd reading
Wednesday 27th March 2024 Lords Chamber

[Lord Adonis (Lab)]

My Lords, I follow the noble Lords, Lord Moylan and Lord Young, in pressing the Minister further on this vexed issue of ground rents. The history of the proposals on ground rents is of a kind of mirage on the horizon, which the Government are constantly hoping to attain, and then it vanishes at the moment when action is expected to be taken. Perhaps I can just sum up the past, because it is important to understand quite how firm the commitments the Government have given are. They have not just raised this as an issue for consultation; they have given very firm commitments up to now. I will then press the Minister further, not just on when the Government intend to respond to the consultation which, as the noble Lord, Lord Young, said, is due, but also on some of the key issues of principle that underlie that consultation.

This process began on 9 November last year, when the Secretary of State issued a press notice from his department, headed “Ground rent reforms to save thousands for leaseholders”. It was a straightforward statement that said:

“Proposals to slash ground rents and save homeowners thousands have been unveiled by the government today”.


The 9 November statement said not that the Government were consulting on whether there should be reform of ground rents, but what the specific reform should be.

The press notice of 9 November set out, in respect of historic ground rents—not new peppercorn leases—the five options of

“setting ground rents at a peppercorn … putting in place a maximum financial value which ground rents could never exceed … capping ground rents at a percentage of the property value … limiting ground rent in existing leases to the original amount when the lease was granted … freezing ground rent at current levels”.

So, in November, the Government set out five options, and the consultation was to choose between those five. Each of the five, if I may comment on the point made by the noble Lord, Lord Moylan, has differing impacts on those who currently earn the ground rents, and some would appear to take more account of their rights than others. What the consultation does not have is an option of no reform of ground rents.

So my first question to the Minister is: is it still the Government’s position—this is a fundamental issue that either this Government will grapple with, or the next one will have to inherit—that there will be a capping of ground rents? Or is it their position that the status quo might be an option?

To muddy the water further, when the Secretary of State introduced the Bill on 11 December—repeating all kinds of points about feudalism which the noble Lord, Lord Moylan, does not like and which my noble friend Lady Taylor pointed out that he had expanded on in his previous speech—he came down very firmly in favour of restricting ground rents for historic leases at peppercorn value. What he said regarding the conclusion of the consultation on the five options that had just been announced will I think be of some importance to us at later stages of the Bill, or to a future Government. He said that,

“at its conclusion, we will legislate on the basis of that set of responses in order to ensure that ground rents are reduced, and can only be levied in a justifiable way … my favoured approach would be, and I believe that it should be, a peppercorn. Of course, if compelling evidence is produced, as a Secretary of State with great civil servants, I will look at it, but my preference is clear, and I suspect that it is the preference of the House as well”.—[Official Report, Commons, 11/12/23; col. 659.]

I too suspect that it was; I think there would have been a cross-party majority in the House of Commons. Indeed, there would be a cross-party majority in this House for limiting ground rents.

That leads to the issue of the disappearing consultation, and why the Government have given no response to it. I suspect that the content of the briefing to the Sunday Times, which the noble Lord, Lord Young, referred to, is more significant than we might be giving credence to. I suspect that it goes to the heart of the issues that the noble Lord, Lord Moylan, raised, and a concern on the part of the Government that there will be protracted legal action, or that they might have to provide some form of compensation.

I do not support the status quo and I believe that, where profits are made by companies and private entities in a totally unjustifiable way, injurious to those on whom they impact, it is a proportionate use of Parliament’s power to intervene to stop it—particularly in cases where that harm is set to increase, which is the big problem at the heart of many of these ground rent complaints, where you have formulae for increasing ground rents that are completely beyond the power of existing tenants to influence. Though it is true that tenants might have the right not to buy, if this is a totally onerous and unjustifiable imposition in the first place, it is right that Parliament should intervene.

However, it is not my view that matters in respect of this; we need to know the Government’s view—not just when they will respond to the consultation and whether they still stand by the five options but, crucially, their view on the legal position with respect to the rights of ground landlords and whether they might have a legal case or be liable for compensation. It is extremely important that we know this, because we may have to legislate in a different way depending on their view.

As it happens, the Secretary of State did address that issue in his Second Reading speech. This is a very Michael Gove statement, because it is so robust and yet not followed up by any action, which is a characteristic of his:

“I know that some people will say, ‘What about A1P1 rights under the European convention on human rights? You are taking property away from people.’ I respect the ECHR, but if it stands in the way of me defending the interests of people in this country who have been exploited by ground-rent massaging, I am determined to legislate on behalf of those people, because their interests matter more than that particular piece of legislation”.—[Official Report, Commons, 11/12/23; col. 659.]


My final question to the Minister is: is it still the Government’s position that if they are persuaded that the right option is to limit or, in effect, eliminate ground rents, they are justified in doing so despite the European Convention on Human Rights? I would be very grateful if she could give us specific answers to these specific questions when she replies.

Building Safety

Lord Adonis Excerpts

Wednesday 27th March 2024 Lords Chamber

[Lord Adonis (Lab)]

My Lords, did I hear the Minister say that, in respect of buildings higher than 11 metres, 87% had a remediation plan that would be delivered by 2028? Could she clarify what she said?

[Baroness Swinburne (Con)]

The 87% refers to the registered providers of social housing, which report that remediation work is due to be completed in 87% of buildings with cladding-related defects by September 2028.

[Lord Adonis (Lab)]

So that is for buildings of 11 metres that are social housing. There are two questions that arise from that. First, if it is in respect of social housing alone, what about non-social housing blocks? What is the equivalent figure there? The second, stark issue raised, given that, as the noble Lord, Lord Young, said, it is already seven years after Grenfell—so in 2028, it will be 11 years after Grenfell before that 87% is dealt with—is the other 13%. It is a sizeable number, and that is in respect only of the most pressing cases, in social housing, which may have been less well maintained. What is the position for the other 13%? Are there schemes agreed that will take longer, or is there still a proportion for which there is no scheme? Either of those situations is, of course, completely unsatisfactory.

[Baroness Swinburne (Con)]

I have numerous statistics in terms of the number of buildings that are involved in this programme. Of course, what we know is how many of those buildings over 18 metres are left without a programme or have completed their programme. Some 10 are left, and they all have programmes in place, so they will be completed as soon as possible. The highest-risk ACM cladding buildings are being dealt with, so we will get very close, in that 98% of them have now started or completed their works.

On buildings of lesser height, of 11 to 18 metres, because the fund was established only last July some of those buildings will not be known to us. We are still working on an estimated number for those requiring remediation. In England, that number is somewhere between 6,220 and 8,890. That figure is based on an estimation and, therefore, a methodology behind it. We expect those numbers to come forward as that fund is called on; as people utilise it to put pressure on the owners of those buildings to deal with this, we expect that number to rise.

I shall come back to the House regularly to update it on progress. We believe that pressure is the right way here, and pressure across the House is definitely the right way to keep up the work and get this done at pace.

--- Later in debate ---

[Baroness Swinburne (Con)]

We believe that those responsible for these buildings need to be the ones who ultimately pay for this, so the answer is yes.

[Lord Adonis (Lab)]

I want to press further on the business of insurance premiums. Did the Minister say that there was an agreement with the Association of British Insurers that, once remediation work had been completed, there would not be any net increase in insurance premiums? That does not appear to be happening at the moment, so what enforcement action will the Government take, if that is the case?

Residential Leasehold for Flats

Lord Adonis Excerpts

Thursday 30th November 2023 Lords Chamber

[Baroness Penn (Con)]

My Lords, as I have said, we believe that commonhold provides a potential way forward to move away from leasehold for flats, but there is reform of commonhold that needs to take place so that it will be fit for purpose. I reassure the noble Baroness, as I have others, that there are significant measures in this Bill that do exactly what she pointed towards, which is giving leaseholders greater control over the properties that they own and live in.

[Lord Adonis (Lab)]

My Lords, the wider problem, of course, is that there are far too few new homes, either leasehold or freehold. Is the noble Baroness aware that France, with a population of about the same size as ours, now has 12 million more homes than Britain, and has built more than twice as many new homes as we have over the last 13 years? There has been a net addition of 2 million homes, a high proportion for social lease. I know that Ministers are not talking to their European counterparts at the moment, but does she not think that learning something from our European partners could be valuable in tackling the housing crisis?

[Baroness Penn (Con)]

My Lords, the Government are absolutely committed to increasing supply. The noble Lord is right that that is part of the solution, particularly when we have in place the provisions to ban new leaseholds in new houses. But the Government are delivering on that promise. We are on track to deliver our commitment to 1 million new homes during this Parliament. We are investing £10 billion in increasing the supply of homes, and in the last few years we have seen some of the highest rates of home delivery in decades.

Levelling Up: Project Delivery

Lord Adonis Excerpts

Thursday 23rd November 2023 Lords Chamber

[Baroness Penn (Con)]

My Lords, as I have highlighted, the department is very happy to speak to any project that sees that it is facing perhaps unavoidable delays in delivery. Our first priority should be looking at what we can do to reduce those delays, but, as I have said, we have also put in place flexibility in the system to extend some of the deadlines.

[Lord Adonis (Lab)]

My Lords, will the noble Baroness tell the House how much damage to levelling up is being done by the cancellation of HS2 to Manchester? Is she aware that, once HS2 is built to Birmingham but not to Manchester, it will take 40 minutes from Euston to Birmingham but 2 hours and 10 minutes from Euston to Manchester? What does she think that will do to business investment decisions over the next generation, and does she not see that this will decimate the economic prospects of the north of England?

[Baroness Penn (Con)]

I am afraid I completely disagree with the noble Lord. There is a choice to be made about where that investment goes, and the Government have made the choice to invest in transport projects that will connect towns and cities within the north far better. It will deliver more improvements to more people faster than the continuation of further legs of HS2.

Levelling-up Report

Lord Adonis Excerpts

Thursday 19th May 2022 Lords Chamber

[Lord Greenhalgh (Con)]

It is important that we look at some of these missions in the round. In that question, the right reverend Prelate brought together three specific missions: we have a health mission, a well-being mission and a housing mission but it is important that we find ways of ensuring progress on all fronts. We have set up an advisory council to do precisely that.

[Lord Adonis (Lab)]

My Lords, as a contribution to levelling up, does the Secretary of State, Michael Gove, have any proposals to relocate his department and the noble Lord the Minister to Stoke? Does he not think that this might be a constructive suggestion and, in particular, enable him to practise what he preaches?

[Lord Greenhalgh (Con)]

I thought this Question might go in all directions, including Stoke. We actually have a department in Wolverhampton and are going to conduct a ministerial board meeting there—but personally, I will be joining remotely.

Levelling Up White Paper

Lord Adonis Excerpts

Monday 15th November 2021 Lords Chamber

[Lord Greenhalgh (Con)]

My Lords, financial inclusion is very important in particular areas, and it is important in addressing it to bind together different departments. That is why there is a new levelling-up task force under the leadership of Andy Haldane that brings together the Department for Levelling Up, Housing and Communities and the Cabinet Office, precisely because we need that Whitehall join-up.

[Lord Adonis (Lab)]

My Lords, can the Minister tell the House how he believes that levelling up can be squared with cancelling the eastern leg of HS2? Is he aware that if HS2 East is cancelled, it will take four times longer to get to Sheffield and Leeds, and six times longer to get to Durham and Newcastle, than it takes to get to Birmingham? Does he appreciate that this will introduce a new east-west divide into the country, which will be the equivalent of our Victorian forebears deciding to build the railways in the western part of the country while leaving the eastern part of the country with the canals?

[Lord Greenhalgh (Con)]

My Lords, I recognise the noble Lord’s expertise on high-speed rail. However, I do not want to comment on the specific scheme. The most important thing for the Government is to back up the investment we have in transport infrastructure in our city regions, and we have committed £5.7 billion for transport settlements for those regions. Of course, decisions about high-speed rail will be taken in due course.

Inequalities of Region and Place

Lord Adonis Excerpts

Thursday 14th October 2021 Lords Chamber

[Lord Adonis (Lab)]

My Lords, we have just listened to an outstandingly fluent, elegant and persuasive maiden speech, and it is a great privilege, on behalf of the House, to welcome my noble friend to the House. He comes from one of the greatest political families of modern Britain, and I am sure he will make a great contribution to Parliament, like his father, his grandfather —who he mentioned—and his brother, who we are delighted to see in the House too.

However, I first met my noble friend in a completely different context, when I was Minister for Schools and he was a director of the Royal Society of Chemistry. The occasion was shortly after the publication of Bill Bryson’s A Short History of Nearly Everything, which the society, with great foresight, paid to send to every state school in the country. Education is the greatest leveller up. My noble friend—inspired, I imagine, in no small part by his mother, who had a great passion for education—has taken this cause to heart. He will have a great opportunity to advance it here in the House and in Parliament.

We are of course all mindful of the peerage controversy so much associated with my noble friend’s father. On reading about it, I learned that the reason it came about was that his uncle, who had been expected to inherit the viscountcy, was tragically killed serving his country in the RAF during the war. One account that I read says:

“Michael was intending to enter the priesthood and had no objections to inheriting a peerage.”

I can assure my noble friend that it is no longer a requirement of the job—but there are ample opportunities for instruction from the right reverend Prelate and his colleagues, if he wishes to advance in that cause as well. My noble friend is extremely welcome to the House, and we look forward to hearing from him again soon.

I wish to address just one issue in respect of levelling up: HS2. Nothing is more important to levelling up this country than transforming its infrastructure, and the single biggest infrastructure project in the country at the moment, directly geared to levelling up, is HS2, which will transform the communications in this country between Greater London and the south-east, the Midlands and the north. The Minister knows a great deal about HS2. When he was leader of his local authority and I was Secretary of State for Transport, we talked about it a great deal. Indeed, we planned together the development of the Old Oak Common interchange station, which will bring HS2 in direct connection with Crossrail, which goes from east to west. The connectivity between those two will further transform the connections between the Midlands and northern cities and London.

I wish to ask the noble Lord about one specific issue: the decision that is widely known, though I do not think that it has yet been formally announced, to cancel the eastern leg of HS2. At the 11th hour, as it were, I implore the Minister to revisit that decision and speak to his friend the Prime Minister, with whom I know he has an extremely close relationship, to make the argument that, if the eastern leg of HS2 is cancelled, the whole future of levelling up half of the country—the eastern side—will be vitiated.

To understand the significance of the potential cancellation of the eastern leg of HS2, you just need to consider what will be the journey times between the major cities of the Midlands and the north and London after HS2, if it is not built. Birmingham to London would be half an hour, Manchester to London would be an hour, Leeds and Sheffield to London would be two hours, and Newcastle to London would be three hours. Where is all the investment and the new social activity in the country going to happen if, for the next few centuries—because we build railway lines to last centuries—that is the pattern of communications between the Midlands and the north of this country and the economic powerhouse of London, which will always continue to be so because it is our dominant city? It is absolutely essential that the eastern leg of HS2 proceeds.

Because we are a democratic community, with very powerful political spokespeople from the eastern side of the country, it is stark staring obvious that, if, by an act of great negligence, Her Majesty’s Government do not proceed with the eastern leg of HS2 now, when the leg to Manchester opens and there is a massive political controversy about the delayed journey times, much poorer communications, much lower capacity and lack of connectivity with Crossrail—because the Old Oak Common interchange will of course be available only to people coming from Birmingham and Manchester—the political campaign to build the eastern leg will be unrelenting. In a classic failure of planning, we will build the eastern leg of HS2 and it will go through to Sheffield, Leeds and Newcastle, but it will be done 30 or 40 years later than it should have been. In that interval, an enormous amount of damage will be done to the society and the economy in the east Midlands, Yorkshire and the north-east of the country and to the connectivity between Edinburgh—because the HS2 trains would go there—and London.

I implore the noble Lord, with the great influence that I know he holds with the Prime Minister, to urge him to revisit this decision, which could be the single most important decision that the Government make in terms of the long-term capacity to level up the north with the south of this country.

--- Later in debate ---

[Lord Liddle (Lab)]

My Lords, I first congratulate my noble friend Lord Stansgate on his maiden speech, which has been described as “outstanding” and “assured”. I also thought that what he had to say about the importance of science was very real. Some critical decisions for the Government are coming up in the spending round in October, and I very much hope that the enthusiasm that Dominic Cummings, to be fair to him, had for the science budget will continue to be reflected in the Government’s policy.

Secondly, I thank the noble Lord, Lord Greenhalgh, for his reply. We in the Lords often say, “Oh, it’s been an excellent debate”, but, actually, this has been an excellent debate. I thought that he tried to respond to it, in his own rumbustious style, and I am very grateful to him for that—

[Lord Adonis (Lab)]

That is a compliment.

[Lord Liddle (Lab)]

It is; “rumbustious” is a real compliment. I thought that he tried to answer the points and displayed a certain sympathy with many of them.

For me, the key things that came out of this debate were, first, what my noble friend Lord Adonis said about HS2, which is one of the key decisions that will affect this country for decades to come. Who wants to add to the north/south divide in this country an east/west divide? That is a fundamental point.

Secondly, the noble Lord, Lord Young, and others talked about the need to reset central-local relations and think about local sources of revenue. We need to see that kind of thinking opened up again. For the department and Michael Gove, who leads it, these issues will come to the fore in the next few weeks. I hope that he reads what we have had to say in this debate in Hansard. I beg to move.

Homeowners: Cladding-related Costs

Lord Adonis Excerpts

Thursday 24th June 2021 Lords Chamber

[Lord Greenhalgh (Con)]

My Lords, we have to let the inquiry take its course, but we recognise that deficiencies in testing have been thrown up, so the Secretary of State has commissioned an expert group to look at construction products testing. We are establishing a new regulatory regime as well.

[Lord Adonis (Lab)]

My Lords, the Minister will remember that, when we had the emotional debates on this issue at ping-pong, he said that the Government would come forward with further measures to deal with a comprehensive settlement in respect of leaseholders. That was the argument why he was not prepared to accept the view of this House that we should impose a timetable. That was two months ago. Can he tell us precisely what measures the Government have come forward with in the last two months?

[Lord Greenhalgh (Con)]

We have continued with the progress of the existing fund, which is now at over £5 billion. As I have said, nearly 700 buildings have had their funding approved for the remediation of other forms of unsafe cladding, similar to the type seen on Grenfell Tower. Obviously, further details around the financing scheme will be announced in due course.

Fire Safety Bill

Lord Adonis Excerpts

Consideration of Commons amendments
Wednesday 28th April 2021 Lords Chamber

[Lord Adonis (Lab)]

My Lords, in Alice in Wonderland, Humpty Dumpty says:

“ ‘When I use a word, … it means just what I choose it to mean — neither more nor less.’ ‘The question is,’ said Alice, ‘whether you can make words mean so many different things.’ ‘The question is,’ said Humpty Dumpty, ‘which is to be master — that’s all.’ ”


That is exactly the position we find ourselves in today. It is an argument about the meaning of words, which the noble Lord, Lord Newby, in an excellent speech, has just pointed up. If one took the Government’s statements and sought to give the usual meaning to the words, then there would not be a problem here this evening.

I noted down what the noble Lord, Lord Greenhalgh, said in his opening remarks: these are just some of the statements he made. My writing is not fast enough to recite his whole speech, but if one took his whole speech, one would think there was no disagreement between us at all. “More needs to be done”, he said. “Industry must play its part and pay its way,” he said. “I agree that leaseholders need more protection,” he said. “Forfeiture,” he said—the fact we are talking about forfeiture is a sign of quite how serious a crisis we are facing—“is a draconian measure”; my writing was not fast enough here, but I think he said, “which is to be discouraged.” He also said, as the noble Lord, Lord Newby, just said, that these measures will be further addressed in the building safety Bill.

All those statements that the noble Lord made go to the heart of the protection we have been seeking to provide for all of those categories of people affected, not just those who live in buildings of more than 18 metres and not just those with costs directly attributable to cladding if they fall in the category of remediation costs which are essentially post Grenfell. This is the key point, because assessments that have been made about fire risks which are not just restricted to cladding are in the wider areas, some of which are in the expanded fire safety order which the Minister referred to.

The issue then is whether the scheme that the Government have said they will introduce to implement the principles that the Minister himself has set out to the House this evening is adequate to the task. We take the Minister at his word that it will be adequate to the task. There is some disagreement about how far it needs to be legislative and how far not legislative, though the fact that he constantly refers to the building safety Bill leads us to think that it will be substantially legislative. In so far as it is not legislative, these measures could be put in a legislative form, or he could make a categoric statement about when the Government will come forward with a comprehensive scheme.

So far, so good. What happens is that the right reverend Prelate the Bishop of St Albans and his understudy who is here this evening, if I may so describe him—anyway, he seems to be maintaining the line of the right reverend Prelate the Bishop of St Albans—and other noble Lords then consistently, on now about 10 occasions during the passage of the Bill, have come forward with proposals to put into legislative form what the Government themselves have told us they want to do. What happens, because we are now back in Alice in Wonderland, is that we pass amendments saying that remediation costs should not be passed on to leaseholders which are attributable to the additional costs which have come post Grenfell, and then the Government come along and say, “Ah, but this does not take account of the following five concerns.”

These are the concerns that the noble Baroness, Lady Fox, just mentioned about small costs, concerns about defining costs, concerns about costs which might be attributable to leases which applied and which tenants willingly engaged in before there were any additional costs put forward—we had a whole list of issues that were raised. What then happens is that the ever-receptive Bishop of St Albans, and other noble Lords change the amendments to take account of the Government’s concerns. Indeed, the amendment of the noble Baroness, Lady Pinnock, this evening meets most of the concerns that have been raised by Christopher Pincher in the House of Commons and by the noble Lord, Lord Greenhalgh, here.

It is worth dwelling on this, because these are hugely important issues potentially affecting millions of people, so we ought to be clear about it. Under the noble Baroness’s amendment, proposed new subsection (1) states:

“The owner of a building may not pass the costs of any remedial work attributable to the provisions of this Act”—


so defining clearly what should and should not apply. Proposed new subsection (2) states that the prohibition on remediation costs being passed on to tenants will have effect

“only until a statutory scheme is in operation which ensures that leaseholders and tenants of dwellings are not required to pay more than £50 per month during the course of the lease”,

but it does not apply to a cost that

“is permitted under a lease or tenancy agreement that was made before this Act is passed, and … does not exceed £500, whether as a one-off cost, or in total across a 12-month period.”

This meets the concerns that the Minister has raised, unless he does not propose to bring forward a scheme that meets his commitments in due course, which is the reason why we go round in circles again.

We then come out of Alice in Wonderland and into the real world. In the real world, we all know what is happening. It is not a secret to those of us who are politicians what arguments have now been happening for two months. Two things are happening. First, a battle royal is going on between the Minister’s department and the Treasury about what costs the Treasury will meet and how narrowly defined they need to be. The Treasury is already concerned about the size of the fire safety fund, the £5.1 billion fund which the Minister referred to, and whether the costs even under that scheme will end up being significantly higher. It certainly does not want more costs to be recognised. The second thing going on of which we are all well aware is that, although the Government say—because huge numbers of people are affected by this, many of them first-time buyers, many of them who have, under Conservative schemes, bought council properties and are leaseholders —that they want to see them fully protected, they do not at the moment either have a plan to fully protect them nor, to be blunt, do they want to protect them any more than they think is politically necessary to get this and subsequent legislation passed, presumably in the run-up to the next election, in a judgment they make on the salience of the issue.

We then come to the role of this House, which is unusual in this case. We had a lecture from the Chief Whip earlier about the supremacy of the House of Commons, which we all recognise, but the supremacy of the House of Commons is in this instance qualified in two respects. The Salisbury convention is clear that the supremacy of the House of Commons applies to all matters which the Government have placed in their manifesto. This House does not seek to cut across clear manifesto commitments which the Government have made when they want to realise them. The Government’s commitment at the election was to sort out this issue; it was not not to sort out this issue. If we take that reading of the role of this House, we will actually be implementing the Salisbury convention this evening if we pass the amendment of the noble Baroness, Lady Pinnock. We are seeking to hold the Government to their manifesto commitments to the people, not going against them.

The other reason why we are back in Alice in Wonderland in respect of the role of this House is that, when the Minister and the Chief Whip said this evening that the Bill will fail, it will fail only if, in response to the amendment being carried, the Government choose to let it fail rather than accept an amendment that puts into law the very commitments that they have said that they propose to meet.

We are in a conundrum as to what to do. If we vote for the amendment of the noble Baroness, Lady Pinnock, we be voting for something that will indeed send the measure back to the House of Commons and could, if the Government refused to give way, lead to the fall of the Bill. That is entirely in the hands of the Government. However, it is manifestly not the case that we are breaking the Salisbury convention, it is manifestly not the case that we are going against the commitments that the Government themselves have given, and it is manifestly not the case that we would be the cause of the Bill falling. The Government would be the cause of the Bill falling, because they were not prepared to accept the amendment.

We all have judgments to take as to how to vote, and I respect people who take different views on this issue, but it is very clear to me that this is not about the supremacy of the House of Commons. As the noble Earl, Lord Lytton, said, in what I have to say is the most impassioned speech I have heard him deliver to the House, this is a matter of the good faith of the Government and whether, when they say something, they mean it. If this House has any role to play, it is to see that high standards of conduct in public life are maintained, that Governments are held to commitments that they give and that the ordinary meaning of words should be taken to apply when they are uttered by Ministers.

[Lord Greenhalgh (Con)]

My Lords, I will not trade Alice in Wonderland anecdotes with the noble Lord, Lord Adonis, but I take issue with the point made by the noble Lord, Lord Kennedy, and the noble Baroness, Lady Pinnock, that this Government and Prime Minister have done nothing or sat on their hands.

The reality is that I was appointed a Minister, a little over a year ago, into this role. The previous Government had first committed £400 million and then, very reluctantly, an additional £200 million towards the costs of remediating the same cladding that was on Grenfell Tower—aluminium composite material. In the month I was made a Minister, the Chancellor committed a further £1 billion. Now this Chancellor and Prime Minister have committed a further £3.5 billion, taking the total funding to an unprecedented £5.1 billion. It is simply not correct to say that we are doing nothing; that is a considerable sum of money and a massive commitment to recognising that we need to dampen the impact of the costs of remediating the unsafe cladding—the major fire accelerant on these buildings—so that a tragedy like the Grenfell Tower fire never happens again.

I also take issue with the noble Earl, Lord Lytton, whose contributions I really enjoy; he is a property professional who speaks with great passion. The reality is that I spent the last year at the coalface, dealing with the tail of building owners who do not want to get on with the remediation—even when the funding is in place. There are two enforcement routes to get them to move even when they do not want to: one is the Housing Act 2004 and the other is the current fire safety order of 2005. It is recognised as an enforcement route, even for external cladding systems; it is just that some fire and rescue authorities feel that it is too ambiguous. That ambiguity, lack of clarification and operational disagreement between different fire and rescue services—I say this as Fire Minister—is a significant problem. However, one reason that remediation is happening today is that enforcement options are in place and this modest three-clause Bill is a very sensible clarification of the fire safety order of 2005.

We are at an impasse. I hope that we may get this vital Bill through, because it is important to get that legal clarity I have referred to. The safety of leaseholders and residents is paramount, and it will be compromised if we do not ensure that this Bill is placed on the statute book by the end of this Session. Tonight is the moment to decide that very fact. The Bill falling will not help leaseholders or make homes safer.

I turn to the amendment from the noble Lord, Lord Kennedy. It lacks clarity in prohibiting all kinds of remediation costs being passed on to leaseholders. It means that, where costs are minor, as a result of wear and tear, or even where leaseholders are responsible for damage, they would still not be expected to pay, which is not a proportionate response. I think all Members would agree that the taxpayer should not pay for all and every cost associated with remediation. The scope is far too broad to be a sensible solution.

In several ways, this amendment has the potential to make things worse for leaseholders; for example, it is unclear who should take responsibility for remediation works until a statutory funding scheme is in place to pay for the costs. This would result in all types of remediation being delayed, which is an unsatisfactory outcome for leaseholders. Practically speaking, on the amendment’s requirement to deliver particular requirements to Parliament within 90 and 120 days, we must be mindful that drafting legislation is a complex matter, which cannot be dealt with in the timeframe proposed. I note that the noble Lord is unlikely to press for a Division this evening, so I will not go any further, but to impose an arbitrary deadline, as stated, is neither helpful nor practical.

Fire Safety Bill

Lord Adonis Excerpts

Consideration of Commons amendments
Tuesday 27th April 2021 Lords Chamber

Moved by

[Lord Adonis]

Leave out all the words after “That” and insert “this House declines to consider the Commons reason before a Hansard record of the House of Commons debate on this vital Bill, held only minutes ago, is available and can be properly considered by members”.

[Lord Adonis (Lab)]

My Lords, I do not wish to detain the House unduly, but I need to draw the attention of the House and, in due course, the Procedure Committee to the really unsatisfactory way that our proceedings are conducted on these important matters relating to Commons reasons.

The Commons debated this matter only a few hours ago, and there is no Hansard account of the debate. We were not at all clear when we were going to debate these hugely important matters affecting millions of our fellow citizens: we were told it might be at 4 pm and then 4.40 pm. Many of us have had to hang around the House for hours, waiting to be told when it might happen; we were only recently told that it would be at 7.10 pm.

Until I came into the House, half an hour ago, I was not aware of the amendments that have been tabled because they are not available, in the haphazard way that we conduct these proceedings. I and many other noble Lords have not yet had a proper opportunity to assess the amendments. They are quite complicated and we are being railroaded into taking decisions on them in the next hour.

This is a totally unsatisfactory way for this House to consider important legislative issues. Although I do not wish to detain the House unduly now, as I have said, I feel duty-bound to draw the attention of the House to the unsatisfactory nature of the proceedings. We should take this matter up with the Procedure Committee. We have proper arrangements for the consideration of Bills at all other stages, including fixed intervals between the different stages of consideration. These are in our Standing Orders and they should apply at this vital last stage of Bills, when we are engaged in interchanges with the House of Commons. I beg to move.

[Lord Ashton of Hyde (Con)]

I start by saying that I disagree with the noble Lord: his amendment is unnecessary because there is a Commons Hansard transcript—it is online and has been since just after 5.30 pm. Nevertheless, the noble Lord’s amendment gives me the opportunity to make it clear to the House that what is proposed for the consideration of the Fire Safety Bill today is entirely in keeping with the normal practice of the House. By “normal”, I mean that this has long been the case and has nothing to do with how we have been working more recently in the hybrid House.

--- Later in debate ---

[The Deputy Speaker (Baroness Garden of Frognal) (LD)]

I have not received any request to speak after the Minister. Does anyone in the Chamber wish to speak? Lord Adonis.

[Lord Adonis (Lab)]

My Lords, the noble Lord is right to say that matters have been considered in this way in the past but that does not make it satisfactory. He said that the Hansard account was available at 5.30 pm. That was one hour and 40 minutes ago and most of us were not even aware of that fact. I did watch the House of Commons proceedings on replay and had to note down by hand all that had been said several times, so that I could get the wording correct. No ordinary member of the public would think that these proceedings are satisfactory, and the Procedure Committee should look at them with a view to improving them. Huge issues are at stake here and they should not be rushed and railroaded through in this way. On that note, I beg leave to withdraw the amendment.

Amendment withdrawn.

--- Later in debate ---

[Lord Adonis (Lab)]

My Lords, the cladding scandal is turning into the next Hillsborough scandal, in terms of not only the terrible and avoidable loss of life but the failure of the public authorities to react in a timely, just and effective manner afterwards. As event after event unfolds and failure succeeds failure in terms of government inaction, I am afraid the scandal grows. Those of us who have seen these events over many years know that there will come a point where the Government will have to concede on these issues.

Anyone who watched the debate in the House of Commons this afternoon and saw impassioned speeches from a string of Conservative MPs—many of whom had encouraged first-time buyers to buy their properties in their political lives, including many of them to buy council properties as leaseholders that are now unsaleable and submerged in negative equity without even a proper schedule of works that can be agreed—will know that this position is becoming unsustainable politically. Not only that, it is becoming a moral quagmire on the part of the public authorities at large: local authorities, regulatory authorities and the Government themselves.

The Minister is in an unenviable position, and we all know why he is in that position. It is because giving the kind of commitment that has been talked about would mean that the £5 billion scheme the Government have announced so far, could, on the basis of estimates I have seen and were being quoted in the House of Commons, be £10 billion or £15 billion. But in this situation we have to work to the just solution, and the just solution is clearly that innocent leaseholders should not be held accountable for costs which had nothing to do with them, were beyond their control and purely in the authority of shoddy developers or inadequate public authorities.

Those developers should be held accountable in due course and the role of the Government is to see that, in the interim—and that interim could be many years; it could be decades before these issues are resolved—innocent leaseholders are not held to ransom. I mean that genuinely; they are held to ransom because they cannot sell their flats and properties until the cladding is sorted out, and in many cases they will be completely unable to meet the costs.

The most powerful speeches in the House of Commons this afternoon were made by Iain Duncan Smith and Liam Fox. The noble Baroness, Lady Fox, thinks that she and I are not always on the same wavelength, but I can assure the House that Iain Duncan Smith, Liam Fox and I hardly ever find ourselves in the same company. But everything that they said today was utterly compelling.

They read from accounts given to them by their constituents of estimates for works of £30,000, £40,000 and £50,000, negative equity, inadequate access to the fire safety fund, insurance increases of 1,000%, large charges faced by leaseholders for interim measures and charges not covered by the scheme. The Government said a forced loan scheme would be announced in the Budget, but one MP—I think it was the Conservative MP for Southampton—said “Which Budget is the Chancellor talking about because it hasn’t come in this Budget? Is it going to be the one next year or the one in 2030?”

These are the elected representatives of the people seeking to hold the Government to account. Our role as a revising Chamber in a matter of such huge importance as this is to see that their voices can be properly expressed and heard. The Minister said that there was a decisive majority in the House of Commons, but between today’s vote in the Commons and the previous vote, the Government’s majority fell by half—I repeat, by half—as a result of one further debate where these issues were properly aired. We have a duty to send this issue back and I am absolutely sure that if the Government succeed in railroading this through—they probably have the votes to do so—it is right that we see whether, with a further opportunity for discussion, more progress can be made.

It is only a matter of time before the Government will have to make significant further concessions. I say to the Minister with all due respect that they will drag the reputation of the Government and the state to a much lower level by not conceding in a timely fashion—as they should have done at some point over the last four years, but certainly must in this endgame where the issues have been raised as matters of acute concern.

With respect to the arguments, the Minister says that it is not correct or appropriate to use the Bill to legislate on this issue. My noble friend Lord Kennedy’s Motion does not use the Bill to legislate for a solution; it requires the Government to come forward in due course with their own legislation. All it does in its various provisions is to set down timescales by which the Government must do this. The Government may say that they are not prepared to come forward with legislation but the arguments keep moving. Last time, the Minister said that legislation might not be required, as he might be able to take all these actions to protect leaseholders without it. If he is not prepared to accept my noble friend’s amendment because of the legislative components, it is incumbent on him to give a commitment and say when the Government will come forward with a scheme.

Christopher Pincher, the Minister in the House of Commons, made a lot of spurious suggestions in his reply there just a few hours ago. He said that the proposal by the right reverend Prelate the Bishop of St Albans was ineffective because it would prevent “very minor” costs, such as replacing smoke alarms, being passed on. That is a ludicrous suggestion; the Government could come forward immediately with a scheme to deal with minor costs if they were so minded, and I see that the amendment from the noble Baroness, Lady Pinnock, specifically exempts minor costs. He also said that it would absolve leaseholders from responsibility for works that might be their responsibility. There will be cases where leaseholders have responsibilities, and they should be held accountable for them, but the much bigger issue here, which we as a Parliament have a responsibility to deal with, is where the state has failed in its responsibilities, as well as developers failing in theirs.

We are absolutely right to send this matter back to the House of Commons if there is a majority to do so. Irrespective of whether the Government resolve this matter over the next few days before the end of the Session, they will be forced by public opinion and the weight of natural justice—as with the Hillsborough disaster and the Horizon disaster—to move on this issue. It is simply deplorable that this will happen at the very end of a long period of pressure, which will bring the reputation of the state for fair play to a very low ebb indeed.

[Lord Greenhalgh (Con)]

My Lords, we all feel the plight of leaseholders. I spend most of my time as Building Safety Minister and Fire Minister in meetings at the building level, trying to accelerate the pace of remediation. Despite the fact that we have had a global pandemic over the last year, we have also had over 150 starts on site and 95% of buildings have now either had cladding of the very same type that was on Grenfell Tower removed or fully remediated, or have workers on site who are within months are making the buildings safe.

These are hard yards. I have worked with colleagues at all levels of government, with the GLA and the deputy mayor, with the appropriate lead in London Councils and with Mayor Burnham in Greater Manchester. There is a huge effort. Very often it involves difficult, brutal conversations, telling building owners and developers to get a move on. In over half the cases of buildings that had aluminium composite material, we saw the building owners step up and either fund the remediation or carry the works ahead, covering this with warranty schemes without passing the costs on to leaseholders.

These are very difficult times for leaseholders, but that is why, in answer to the noble Lord, Lord Kennedy, the Housing Secretary announced a very comprehensive five-point plan in February. Essentially, we have increased the building safety fund by some £3.5 billion to £5.1 billion. Details of how the revised fund will be spent will be announced very shortly. In addition, we have announced a high-rise levy, which will form part of the building safety Bill, and a tax on developers, because it is important that the polluter pays. There needs to be a financing scheme for medium-rise buildings of between four and six storeys. That is the plan that we have put on the table.

I also point out in answer to the noble Earl, Lord Lytton, and the noble Baroness, Lady Fox of Buckley, that the Bill does not create liability. This is a simple Bill clarifying the fire safety order to let our fire and rescue services do the job they do in keeping us safe. The Bill clarifies an existing regime. I want to be absolutely clear that it does not create a new liability.

I agree with the noble Earl, Lord Lytton, that we need to strengthen redress to stop this all falling on the taxpayer. I have been very clear that we will bring forward measures that will do that as part of the building safety Bill. They will make directors as well as companies liable for prosecution in some instances. The reality is that it is absolutely ludicrous that the statute of limitations under the Defective Premises Act is only six years. That is the statutory period of redress. We will bring forward measures to deal with that point. When I buy a pair of tweezers I get a lifetime guarantee, but when a poor leaseholder invests their life savings and makes the most significant payment in their lives to own their own home the period for statutory redress is simply not acceptable.

I come back to Amendments 4L and 4M. I am afraid that they are unworkable, impractical and do not deliver the solutions for leaseholders. As noble Lords have heard before, it is impractical and confusing to amend the fire safety order to try to resolve the issue of who pays. These amendments seek to cover the very complicated relationship under landlord and tenant law, including financial obligations and liabilities between freeholders and leaseholders. Frankly, these matters do not sit naturally with the fire safety order.

The right reverend Prelate the Bishop of St Albans spoke very eloquently to his amendment and to the two amendments that have been proposed. None of these amendments works because, once again, they orphan the liability of works until such time that a statutory scheme is in place that pays for the work directly attributable to the Act. In answer to the noble Lord, Lord Adonis, both his amendments reference the provisions of the Act in so doing. I have talked about the difficulties of defining which works might be directly attributable to the Fire Safety Bill’s provisions. I have gone over that ground several times. Orphaning liability simply delays essential fire safety works.

In addition, the proposed scope of the works remains too broad, even with the £500 threshold proposed by the noble Baroness, Lady Pinnock. It simply does not resolve the issue. Some of the works that may be required will be very low cost and anyone would reasonably expect the leaseholders to pay. That, frankly, could be more than £500 a year. As no taxpayer scheme for such minor works will be forthcoming, we then reach deadlock.

There is an additional issue which has not been raised by noble Lords: subsidy control. It is a small but important point. Depending on the specific details, it is possible that such a statutory scheme would not be permissible under subsidy control rules. Some leaseholders have undertakings—for instance in buy to let—and subsidy control rules limit how much benefit can be conferred on undertakings. In effect, it may not be possible to relieve leaseholders and tenants from all costs of remedial works attributable to the Bill without breaching subsidy control. As the noble Lord, Lord Kennedy, knows, further detailed consideration is needed.