Leasehold Reform

Debate between Clive Betts and Lisa Nandy

Tuesday 23rd May 2023 Commons Chamber

[Lisa Nandy]

I agree; if we could just do what we have been promising for a long time, the reality for my hon. Friend’s constituents would be transformed from one of insecurity and anxiety to one of security and the foundation of a decent life. They are lucky to have her as their Member of Parliament to fight on their behalf.

It was in 2002 that the Labour Government introduced commonhold. There were voices even then—some of them in the Chamber today—who urged us to go further and end the injustice altogether. In the decades since, there has been growing recognition on all sides of the House that action is long overdue. In 2017, the Government said that they would legislate to prohibit the creation of new residential long leases on houses, whether newly built or existing freehold houses, other than in exceptional circumstances. That commitment was repeated in the 2019 manifesto and by the former Secretary of State, the right hon. Member for Newark (Robert Jenrick), yet leaseholders were left waiting.

[Mr Clive Betts (Sheffield South East) (Lab)]

We have had a further commitment from the Government along similar lines. In response to a Select Committee report in 2019, the Government said:

“The Government agrees with the Committee that, other than in exceptional circumstances, there is no good reason for houses to be sold on a leasehold basis.”

Four years later, thousands more properties have been sold on an unacceptable basis, and the tenants, effectively, of those properties who have been left to pay exceptional costs are not able to get out of the lease without very high charges.

[Lisa Nandy]

I pay tribute to my hon. Friend for the work that his Committee has done on this issue over a long period of time. As he said, there is no reason that this should continue except for a lack of political will to do what we have all acknowledged is the right thing.

Into this absurd scenario steps the current Secretary of State. I know that the right hon. Gentleman has the right intentions—indeed, his record has been clear. On 9 June last year, he told this place:

“it is absolutely right that we end the absurd, feudal system of leasehold, which restricts people’s rights in a way that is indefensible in the 21st century.”—[Official Report, 9 June 2022; Vol. 715, c. 978.]

On 30 January this year, he said in response to a question I posed to him:

“Finally, the hon. Lady asked if we will maintain our commitment to abolish the feudal system of leasehold. We absolutely will. We will bring forward legislation shortly.”—[Official Report, 30 January 2023; Vol. 727, c. 49.]

Now, we are told that the Secretary of State was being too maximalist. We have had grumbling from Government Back Benchers that the Secretary of State is being too socialist. Downing Street has stepped in, plans are being rowed back and he is not even able to set foot in the Chamber today. It is a bit of a mess, isn’t it?

In just a few months, the Government’s whole housing policy has completely unravelled. As my hon. Friend the Member for Hornsey and Wood Green (Catherine West) said, they crashed the economy and sent mortgages through the roof. They caved in to their own Back Benchers and, in one stroke, ensured that their own housing targets were not worth the paper they were written on. That led to dozens of councils reducing or halting altogether their house building plans, and a collapse in the projected number of houses built in coming years, in the middle of a housing crisis. The Home Builders Federation warned earlier this year that new housing supply in England would soon fall to its lowest level since the second world war.

While the Government are locked in internal battles on making basic improvements for renters, their Levelling-up and Regeneration Bill—their flagship legislation that was supposed to reform an archaic planning system—is stuck in the House of Lords, where it is commonly referred to as the Christmas tree Bill, as it has so many amendments attached to it. It does make us wonder what is actually the point of this Government.

The Secretary of State was clear that he would abolish leasehold. No one thought that it would be done overnight. The Law Commission report sets out a clear road map on enfranchisement, commonhold and the right to manage. The major leasehold groups have always recognised that it would take some time to phase out this archaic system, and so have we, but there is no excuse for inaction on the manifesto commitment to end the sale of new private leasehold houses, or for delaying the start of the process of phasing out existing leasehold and making commonhold the default of the future, as my hon. Friend the Member for Greenwich and Woolwich (Matthew Pennycook) has often said.

Social Housing and Building Safety

Debate between Clive Betts and Lisa Nandy

Thursday 9th June 2022 Commons Chamber

[Lisa Nandy (Wigan) (Lab)]

On 14 June 2017, every single person in this country watched in horror as a blaze in London became, within hours, one of the worst disasters of modern times. Some 72 people lost their lives that day and dozens more were injured. Among them, as the Secretary of State has said, were young children, GCSE students, retired couples and entire families. As the family of 78-year-old Ligaya Moore poignantly put it, it was a tragedy that turned “laughter into silence”.

I join the Secretary of State in welcoming some of those families to the Chamber today. It always feels uncomfortable, at moments such as this when we stand here and speak, that their voices are not heard and ours are, but I have heard from many of the families affected by this appalling tragedy over the past few years that what they want most is to hear from us the action we will take to honour those lives and build a fitting legacy. I am determined that we will work with the Secretary of State and with all political parties across this House in order to turn that commitment that we have all respectively made into reality.

There has rightly been much soul-searching about how such a tragedy was possible in modern Britain. The public inquiry is still under way and must be allowed to do its work without political interference. However, that must never be allowed to become an excuse for delay or for justice denied, because this was not the first fire in a block with similar cladding. The Government were aware of problems as early as 1986, well before a block of flats in Merseyside caught alight in 1991. That fire, at Knowsley Heights, was followed by similar fires spanning three decades, from Irvine in Scotland to Southwark in south London, where six people lost their lives. In those intervening decades, the alarm was raised many times. One parliamentary inquiry led by the former Member for Southend West, David Amess, who is much missed in all parts of this House, warned that it should not

“take a serious fire in which many people are killed before all reasonable steps are taken towards minimising the risks.”

This series of failures spanned all political parties and successive Governments over many decades. We should have heard that and we should have acted. I therefore join the Secretary of State in saying, on behalf of my party, that we are sorry that we did not hear it and sorry that we did not act sooner.

But how did those warnings go unheeded by so many for so long? The Government’s lawyer told the official Grenfell inquiry that

“within the construction industry there was a race to the bottom, with profits being prioritised over safety.”

It makes me angry to hear that that can be admitted with such candour now but nothing was done before. I share the Secretary of State’s passion to go after those who recklessly disregarded people’s lives and put their profits and their own interests before safety. If they broke the law, acted recklessly or acted immorally, then I will join him in going to the ends of the earth to make sure that they pay a heavy price for doing so.

We have to ask ourselves, too, standing here in the centre of power: who permitted that to happen? Over 30 years and five different Governments—Labour, coalition and Conservative—how did it come to pass that profits were allowed to matter more than people. How could the concerns and lives of people in the centre of one of the wealthiest boroughs in the wealthiest city in one of the wealthiest countries in the world be ignored—effectively rendered invisible by decision makers only a few short miles away? The appalling tragedy suffered by the people of Grenfell is undeniable evidence of the unequal society that we live in, where lives are allowed to be weighed against profit on a balance sheet and come out the worst, and where those who lack money also lack power. When I talk to social housing tenants up and down the country, this what I hear so often—that they are not seen or heard by decision makers, and that when they raise their concerns and bang on the doors of the corridors of power, those concerns still go unheeded. One social housing tenant said to me: “We simply do not count.” This has to be the day when we stand up together and say, “This ends now.”

There are 4 million families in rented social housing in England. Every single one of them deserves a decent, safe home, and, more than that, the power to drive and shape the decisions that affect their own lives. We should be scandalised that so many homes are not up to a fit standard, not just on fire safety but in being cold, damp and in a state of disrepair that shames us all in modern Britain: homes with black mould and water running down the walls; homes that are unsafe; homes that are damp and overcrowded. I recently heard from a teacher about a child who was coming to school covered in rat bites. The school is using its pupil premium to send people round to make sure that these children are clothed, fed and protected from rats. What have we come to in Britain in the 21st century? It is an absolute disgrace.

The Secretary of State is right that we should take a zero tolerance approach to social landlords who do not live up their obligations—who do not do everything within their power to make sure that those issues are dealt with. But I also gently say to him, in a constructive tone, given the gravity of what we are dealing with today, that the Government have to do their bit as well. That means reversing some of the cuts that have been made to councils and housing associations in recent years which mean that repair budgets are virtually non-existent in many parts of the country, and that good people have been lost and expertise has gone.

We welcome the decision to publish a social housing reform Bill to try to tackle some of these issues, although we are concerned that it has not materialised in advance of this debate. We were led to believe that we would have that Bill before we stood up to speak today. If there are problems within Government—if there are wranglings taking place behind closed doors—my offer to the Secretary of State is this: we will work with him and support him in whatever battles he has to make sure that this Bill sees the light of day, and quickly. That also goes for the renters reform Bill, which must, as my hon. Friend the Member for Brentford and Isleworth (Ruth Cadbury) said, deal with the appalling standards in many private rented homes up and down this country. Some of that, I have to say to the Secretary of State, has been caused by Government policies such as the bedroom tax, which forced many people out of the secure social home that they had lived in for many years, close to friends, family and children’s schools, and into private, rented, often overcrowded and substandard accommodation that, absurdly, cost the public more than it did to house them in their own home.

We welcome some of the measures that the Secretary of State has proposed, particularly the promise to beef up the role of the regulator. This is a welcome step forward giving it the power to inspect, to order emergency repairs, to issue limitless fines, and to intervene in badly managed organisations. But we have to do more to tilt the balance of power back towards tenants to give them not just a voice but real power to shape and drive the decisions that affect their lives, their homes, their families and their communities. The measures on tenant satisfaction and a residents’ panel that meets Ministers three times a year are welcome, but well short of a dedicated tenants’ organisation that is put on a statutory footing and exists to be a voice to champion their interests. Such a body existed under the last Labour Government but was scrapped by the Secretary of State’s Government in 2010. I ask him please not to close his mind to perhaps revisiting previous methods that worked. Let us work together with tenants to get this right once and for all.

[Mr Betts]

My hon. Friend is absolutely right about the body—the Tenant Services Authority—that used to exist and was in place to do that. Let me return to the point that I made to the Secretary of State in an intervention: this is about resources. Councils and housing associations are short of resources. They cannot bring their homes up to a proper standard—the new decent homes standard—build new homes, and do all the necessary building safety and other works with the money they have. Will my hon. Friend join me in pressing the Secretary of State—hopefully he is listening, as he said he was—to make sure that social housing landlords have the same access to funds to deal with safety works that are now, quite rightly, available to the private sector?

[Lisa Nandy]

My hon. Friend is absolutely right. I would add to the many challenges currently facing councils and housing associations the challenge of decarbonisation and the goal of net zero. These things are keeping well-meaning, good people who work in our councils and housing associations awake at night trying to work out how they are going to square the circle, and they deserve more support from their Government.

Nor is it acceptable that the measures are silent on how many new social housing properties will be built. We have a chronic shortage of affordable rented homes, with some of the challenges that my hon. Friend outlined. It is really concerning that today the Prime Minister said that the big idea to solve this is to allow people to use benefits to get a mortgage—not because we disagree with the principle of extending home ownership much more widely to those who want to grasp it, but because he seems to have forgotten to talk to the lenders. The Secretary of State will know that this has been the problem with previous announcements that have aimed in similar ways to help people to get mortgages. If mortgage lenders are not on board, they simply will not do it. The Prime Minister may not have reached out to mortgage lenders, but I am sure the Secretary of State will. When he does, will he talk to them about the very real difficulties of people on universal credit—all of whom, by definition, have savings of less than £16,000, with most having very little in savings, if anything at all—and about how they get a mortgage without any kind of deposit, and whether that is indeed viable? The Prime Minister appears to have forgotten to talk to mortgage lenders; I think it is possible that he also forgot to talk to the Secretary of State before he made the announcement. I do not envy the Secretary of State the task of trying to sort this out, but I am sure that he will go at it with his characteristic tenacity, and I wish him well in the endeavour.

I also wish the right hon. Gentleman well in realising the ambition he set out today: that when the Government extend the right to buy on a voluntary basis to housing association tenants, they will ensure that the homes are replaced, like for like and one for one. I was pleased to hear him say that he had secured that commitment, because Government figures suggest that while just over 2,500 council homes were built in 2010, over 11,000 were sold off under the right to buy; and, as he knows, in the Government pilots of the extended scheme, only half of the homes were replaced and the replacements were more expensive and inferior in standard to the ones that were sold. So how is the Secretary of State able to give this commitment today? What is the estimate of the cost of doing that, and where will the money be found? He knows better than anyone how squeezed his existing budget is. Given that full replacement of right-to-buy homes has never been achieved, how does he intend to pull that off this time? Surely, with 1 million people stuck on social housing waiting lists and a shortage of 1.5 million homes, he is not going to pursue measures that make the situation worse for most families?

[Mr Betts]

There are two important questions here. First, will participation by housing associations be voluntary? They are independent organisations, not part of the public sector. Secondly, replacing one for one, like for like, a family home for a family home, is not just about the Treasury making up the discount. Talk to housing associations: the cost of building a replacement is often greater than the market value of the home sold. There is another gap, which the Government have to fill.

[Lisa Nandy]

I think my hon. Friend, the Chair of the Select Committee, is making the Secretary of State’s day. We can add that to the very long list of problems. I think his question was more for the Secretary of State than for me, and I am sure he will ensure that it is addressed in the winding-up speeches, but I add my voice to his in saying that one of the reasons we were very concerned about the scheme is that it reaches only a very small number at a very high price.

We have a housing crisis in Britain and, as the Secretary of State knows, it manifests in a multitude of ways—in people who have been mis-sold leasehold properties, people who face soaring rents and are crippled by housing costs and the cost of living, and people in totally unsuitable exempt accommodation. Those loopholes have still not been closed while people continue to milk the system and claim housing benefit while allowing communities to fall into rack and ruin.

As the Secretary of State acknowledged, five full years after the Grenfell tragedy thousands of people remain stranded in homes covered in similar cladding, facing ruinous costs because of a scandal that was not of their making. The right hon. Gentleman is right that developers, not leaseholders, should pay. He has pushed that further than any of his predecessors and he has my full support in doing so. As long as he continues down that road, we will support him in the fight. However, I understand that so far 45 homebuilders have paid £2 billion to fix fire-related safety defects, which is roughly half of what he told the House would be needed. Where will the other £2 billion come from? What assurances and guarantees does he have that the developers who have agreed to pay cannot backtrack on any of the agreements?

The Government’s plans are missing several elements that need to be addressed and added to existing measures in the Building Safety Act 2022. The Secretary of State will be aware of those. There is still far too little support for the significant number of leaseholders who face huge bills to fix non-cladding defects.