Social and Affordable Housing Renewal

Matthew Pennycook Excerpts

Wednesday 28th January 2026 Written Statements

[The Minister for Housing and Planning (Matthew Pennycook)]

On 2 July 2025 we published a five-step plan to kickstart a decade of social and affordable housing renewal and set out this plan to the House in a written ministerial statement—HCWS771.

Today I am providing a progress update on the implementation of the plan, as well as confirming next steps in respect of grant funding, regulation, rebuilding sector capacity, and the reinvigoration of council house building, so that registered providers have the clarity and certainty they need ahead of bidding opening for our new social and affordable homes programme—SAHP—next month.

The biggest boost to grant funding in a generation

In July we confirmed headline parameters for our new 10-year £39 billion SAHP. Prospectuses for London and the rest of England were published by the Greater London Authority and Homes England respectively in November 2025. Bidding for the programme will open next month.

Rebuilding the sector’s capacity to borrow and invest in new and existing homes

We remain committed to providing a stable rent policy for social and affordable housing that supports investment in new and existing homes, with the right protections for existing and future rent payers and for public spending.

The 10-year settlement of CPI + 1% announced at the spending review gives the sector the long-term certainty it needs. We also confirmed at the spending review that we would implement a convergence mechanism as part of the new long-term settlement, not least because we believe that doing so is right in principle to address the disparity between actual social rents and formula rents.

Following consultation, I am today confirming that registered providers will be able to increase weekly rents for social rent homes that are below formula by up to an additional £1 on weekly rents each year over and above CPI + 1% from 1 April 2027, and by up to an additional £2 on weekly rents each year over and above CPI + 1% from 1 April 2028, until formula rent is reached.

Convergence will only result in a tenant paying more where their rent is below formula rent—i.e. below the maximum that could be charged if their social rent home was re-let to a new tenant. We believe that this approach strikes a fair balance between the need for increased investment in new and existing homes, the interests of existing and potential social housing tenants, and the consequences for public spending and our fiscal rules.

To help providers build more social and affordable homes, we announced at the spending review that we would make available £2.5 billion of low-interest loans over four years—2026-2030. The loans will be made available to private registered providers of social housing and will be administered by the National Housing Bank (Homes England), and by the Greater London Authority in London.

Today I am announcing that 60% of the £2.5 billion—i.e. £1.5 billion—will be allocated to London, in the light of the acute challenges facing providers in the capital. The loans will be available at an interest rate of 0.1% and will have a duration of 25 years. They will be used to deliver the same social and affordable tenures and strategic priorities as funding under the SAHP.

They will be made available via a competitive bidding process, following confirmation of initial grant allocations made through the SAHP. We expect providers to submit ambitious grant bids for the SAHP when it opens next month, with the loans intended to secure additional homes over and above those delivered with SAHP grant funding alone. There will also be an opportunity to bid to use low-interest loans to acquire section 106 homes. Up to 10% of the £2.5 billion will be available to support the delivery of social and affordable homes via this route. We will confirm further details in the near future.

I am today also publishing a road map detailing how the Government intend to deal with the legacy problem of existing unsold and uncontracted section 106 units and how we will prevent the problem recurring by laying the foundations for a simple, more transparent and more resilient section 106 system. I will publish a separate written ministerial statement setting out further details about this policy package.

Establishing an effective and stable regulatory regime

Building new social and affordable homes must go hand in hand with ensuring that our 4 million existing social homes are safe, decent and warm for tenants. To support registered providers to invest in existing homes, we are implementing a modernised regulatory framework that puts tenant safety and experience at its heart but is proportionate for providers.

I am today confirming details of the new, modernised decent homes standard. This new DHS will apply to social and private rental tenures from 2035, allowing landlords time to plan carefully to implement the changes. It has been designed to reflect modern expectations of rented homes and improve health outcomes for tenants. It prioritises safety, decency and warmth, and it will act as a common standard for both private and social rented housing.

Following consultation, the new DHS will focus on condition as the primary factor when determining compliance of building components such as windows and roofs, rather than age. It will go further in ensuring that rented homes are provided with good-quality facilities such as kitchens and bathrooms, and it will introduce safety measures such as mandatory child-resistant window restrictors—this will help to prevent tragic falls and will give parents greater peace of mind. It will also establish a more proactive and preventive approach to addressing damp and mould.

Having carefully considered feedback to the consultation, we will not introduce enhanced home security regulations, a mandatory floor coverings requirement, or an obligation for landlords to meet repair standards within the public realm. We recognise that some landlords are already providing floor coverings, but many residents struggle to provide their own basic furnishings. As such, we intend to work with landlords and tenants to rapidly identify cost-effective ways in which landlords can better support tenants in need.

The new, modernised DHS necessarily balances the cost implications of improving the quality of existing rented homes with the need to increase social and affordable housing supply, given the importance of the latter to moving people, including many vulnerable children, out of unsuitable temporary accommodation. Guidance will be published in due course to support early action and compliance. A full Government consultation response and policy statement has been published today, setting out details of the new standard.

We have also published today the final standard to provide direction to the social rented sector on a new minimum energy efficiency standard and will publish a full Government response to this consultation shortly.

Following consultation, we have decided that all new and existing social rented properties must have an energy performance certificate C, using reformed EPCs, in a choice of fabric performance, smart readiness or heating system metric, by 1 April 2030. The compliance date to meet a second metric has been extended, so that all new and existing social rented properties must meet the equivalent of EPC C in a second metric by 1 April 2039. This recognises the unique role that social landlords play in both improving the energy efficiency and decency of homes and in increasing the supply of social and affordable housing, ensuring that social landlords have the confidence to invest now towards meeting our shared objectives to reduce fuel poverty, decarbonise the sector and increase supply.

This new standard will encourage building improvements that make homes warmer and energy bills cheaper, and that lead to lower emissions. We will publish further guidance to support social landlords with the implementation of the new standard in due course.

We have received extensive feedback from registered providers over many months, making it clear that confirmation of the future homes standard is key to unlocking ambitious development plans across the sector. The FHS will include high levels of fabric efficiency, low-carbon heating and solar by default. We will publish the consultation response, full specification, alongside laying a statutory instrument in the first quarter of 2026. This will set out the policy detail and transitional arrangements.

On 27 October 2025 we brought into force phase 1 of Awaab’s law, specifying fixed timescales to address damp and mould hazards and requiring all emergency hazards to be addressed within 24 hours. We are now undertaking our “test and learn” approach before extending the requirements to other housing health and safety rating system hazards. Last year we also introduced regulations requiring social landlords to carry out checks on electrical installations, and any appliances they have provided, at least every five years. This already applies to new lets and will be phased in for existing tenancies over the course of this year.

Reinvigorating council house building

Over recent years, councils have once again begun to build new affordable homes. Annual completions by councils have increased year on year for the past five years, and in 2024-25 they completed 10,480 homes—the highest number since the current reporting period began in 1991-92. We want to support councils to build upon the progress already made. We will continue to work with the sector to ensure that councils have the confidence, capacity and capability to deliver affordable homes at scale once again.

To provide councils with greater certainty and to support ambitious supply plans, I am announcing today that we will extend the “preferential” borrowing rate for council house building from the Public Works Loan Board rate for a further year until the end of March 2027. It will continue to be set at gilts + 40 basis points, and will be available for house building through the housing revenue account.

Additionally, I can confirm that the threshold for when a council must open an HRA will be increased from 200 to 1,000 homes from today. This will ensure that councils always have enough homes to make opening and operating an HRA financially sustainable. It will also provide councils without an HRA with greater flexibility to increase delivery, including through SAHP and the acquisition of resettlement homes through the local authority housing fund.

Finally, in July we launched the council house building skills and capacity programme. In its first year, CHSCP has engaged with 81 councils through the council house building support service to expand their delivery capability. As part of the expanded pathways to planning programme, CHSCP will recruit and train up to 50 graduates for placement with councils in 2026-27 to become qualified surveyors or construction project managers.

In November, CHSCP’s council house building support fund allocated £5.5 million to 29 councils to aid the development of SAHP bids. Today I am confirming that, due to strong demand, we are allocating a further £3.5 million to 15 additional councils. In total, this should enable these 44 councils to deliver up to 9,850 new homes and accelerate the delivery of a further 1,700 homes across the course of SAHP.

A renewed partnership with the sector

A decade of social and affordable housing renewal will only be delivered by Government working in close partnership with the sector. That is why in the coming weeks we will work with the National Housing Federation, the Local Government Association and other sector bodies to agree a compact. Once agreed, that compact will be overseen by a taskforce comprised of representatives from a range of sector organisations and interests. More detail about the terms of reference and membership of this group will be set out in the coming weeks.

At the heart of the compact will be ambitious social and affordable house building commitments, evidencing how the grant funding support and regulatory certainty and stability that this Government have provided has translated into ambitious delivery plans and bids into the SAHP from housing associations, councils and other registered providers. It will also be premised on strengthened joint governance and accountability mechanisms, including agreed supply, decency and other metrics that will be tracked and monitored, with oversight provided by regular reporting back to the Secretary of State.

[HCWS1283]

Planning: Section 106 System

Matthew Pennycook Excerpts

Wednesday 28th January 2026 Written Statements

[The Minister for Housing and Planning (Matthew Pennycook)]

The Government have a manifesto commitment to deliver the biggest increase in social and affordable house building in a generation, and to strengthen planning obligations to ensure new developments provide more affordable homes.

Section 106 agreements are, and will remain, an essential mechanism for delivering social and affordable housing. They account not only for a significant proportion of affordable home completions, but also a significant share of total new home delivery. Without them, the development pipeline as a whole is at risk of contracting sharply.

However, in recent years, the negotiation of section 106 agreements has become synonymous with inefficiency and delay. To ensure the developer contributions system secures the supply and affordability outcomes we seek in the years ahead, we need to reduce its complexity and minimise negotiation friction.

In the short term, we also need to act to deal with the detrimental consequences of a declining market for section 106 affordable homes. A complex range of factors has led to the sharp drop-off in demand for section 106 units over recent years, with the result that thousands of constructed or consented section 106 units are currently uncontracted. This state of affairs is delaying the build-out of development sites across England, and disrupting both affordable and wider housing supply.

To this end, today the Government are announcing a comprehensive policy package that will lay the foundations for a simpler, more transparent and more resilient section 106 system, and deal with the legacy problem of existing unsold and uncontracted section 106 units.

Immediate action to unlock unsold and uncontracted section 106 homes

Estimates vary, but it is not in dispute that thousands of unsold and uncontracted section 106 affordable homes have built up over recent years. They have done so as a result of the complex interplay between a range of factors. These include:



Registered providers of social housing facing mounting pressures from severely constrained financial capacity, higher costs of finance, rising building costs and commitments to remediate existing stock to meet building safety and decarbonisation requirements, all of which have led to a scaling back of section 106 acquisitions.

Concerns among RPs that some section 106 homes do not meet the quality and other standards required. Examples include section 106 homes not meeting described space standards or not being in conformity with the, now updated, decent homes standard and minimum energy efficiency standard, as well as anticipated higher new standards (e.g. changes to building regulations, future homes standard).

Negotiations on section 106 agreements can create delays in the planning process and increase costs for local authorities and developers, which can disproportionately impact small and medium-sized enterprise developers. A lack of capacity and capability at the local authority level in terms of legal resource, in comparison to larger developers, often means that local authorities are at a disadvantage when negotiating contributions at the planning application stage.

RPs deciding to prioritise other routes to development, mainly land-led grant funded development, where they can have greater influence over specification and design and avoid management challenges stemming from their more limited control as an intermediate leaseholder of small numbers of homes in blocks managed by an external managing agent or freeholder (e.g. service charges for tenants can pose barriers to managing these homes as social housing); and

RPs and developers being unable to agree on section 106 unit pricing.

The Government have already taken a number of steps to support demand for section 106 units, not least spending review measures designed to rebuild the capacity of RPs. As a result, we are seeing tentative signs of an improvement in appetite for acquiring section 106 homes. However, despite this positive shift in sentiment post spending review, we know that there are still housing schemes where developers remain unable to secure an RP buyer for the affordable homes set out in the original section 106 agreement, and where local planning authorities and developers have not discussed or reached agreement on variations to planning obligations, with the result that many of these sites are stalling.

For this reason, as of today, we expect all LPAs to take advantage of existing planning flexibilities to renegotiate section 106 agreements, and to allow the tenure of homes to be varied in order to secure a buyer where affordable homes secured in section 106 agreements remain uncontracted or unsold. This can be effected by a deed of variation—making amendments/revisions to existing section 106 agreements—either by agreement of the parties to the section 106 or by formal application under section 106A of the Town and Country Planning Act 1990.

To ensure we target sites that are genuinely stalled, the following section sets out the conditions that LPAs should ensure are met, and the approach to negotiation they should take, where it is necessary to agree a deed of variation with developers holding uncontracted section 106 units that have not found any suitable RP buyer.

This measure is intended to support LPAs in exercising their ability to renegotiate planning obligations. It will be strictly time-limited, in order to target those section 106 homes already built or very close to completion but unable to find an RP buyer. This policy is also laid out in the section 106 road map published on gov.uk.

Conditions for accessing this time-limited process

LPAs are expected to consider renegotiating section 106 agreements when the following conditions are met:



Developers should have exhausted all reasonable endeavours to find an RP buyer based on the affordable housing marketing, and any other relevant requirements set out in the original section 106 agreement.

Developers should have uploaded any uncontracted section 106 homes onto the Homes England clearing service by 1 June 2026 to give a final opportunity for RPs to bid to purchase these homes. Any homes not uploaded onto the clearing service by this point will be outside of this process.



Homes should be live on the clearing service for a period of six weeks from the date of the unit being uploaded.



The section 106 homes should be due for completion on or before 1 December 2027, to be eligible for this time-limited approach; completion defined as when a home is ready for occupation or when a completion certificate is issued. Expected completion dates should be registered on the clearing service to guide LPAs on whether all above conditions are met.

LPAs should seek to avoid tenure renegotiations for uncontracted section 106 homes that have received reasonable offers from willing and suitable RP buyers, as is current practice, to avoid the loss of social and affordable housing to private sale.

As is currently expected, developers should inform LPAs of any, and all, bids they receive from RPs seeking to buy uncontracted section 106 units. LPAs are actively encouraged to request that these details are provided.

Assessing the reasonableness of bids is ultimately a matter for individual LPAs but, where available, they are encouraged to consider the following evidential sources: site level viability evidence; published commuted sums policies; grant rates; surveyor data; and recent section 106 purchases in the locality.

Given the clearing service will have provided an opportunity for RPs to identify and bid for unsold and uncontracted section 106 homes, LPAs are encouraged for this temporary period to take a pragmatic, time-limited, and light-touch approach to assessing bids, and any further information requests, for example evidence of marketing efforts or details of contact with prospective buyers in the locality. In instances where there is a dispute between the LPA and developer over whether bids received are reasonable, they may also wish to seek a third-party view to support a resolution, as per an existing alternative dispute resolution procedure.

Guidance for LPAs on proceeding with a deed of variation

LPAs should confirm their decision on proceeding to renegotiate the section 106 agreement as quickly as possible—with a guideline of no more than twelve weeks from the end of the six week period on the clearing service, and consider the following in negotiating to alter the tenure of eligible homes:

LPAs are encouraged to take the following approach:

(i) seek alternative affordable housing or discounted market tenures in the first instance where possible;

(ii) if there is no buyer for such tenures, proceed through to private market rent or sale—with an equivalent form of affordable housing provided on an alternative site within the LPA s area or, where this is not feasible, a financial payment made in lieu of onsite affordable housing.

LPAs should include stipulations that make clear that if homes are not completed on time and by the deadline of 1 December 2027, schemes will revert to the tenure mix set out in the original section 106 agreement. Renegotiated section 106 agreements should provide for this without the need for a further deed of variation to be made.

When considering phased development, LPAs and developers should agree a tailored approach with regard to the circumstances of the specific phases i.e. if the first phase will be completed by 1 December 2027, then a deed of variation should be considered in line with the policy set out in this statement. However, where phases contain units that are not expected to complete by this point, the terms set out in the original section 106 should continue to be expected to apply.

In line with planning practice guidance on viability, site-specific viability assessment should not be used on schemes subject to the golden rules for the purpose of reducing developer contributions, including affordable housing. The Government are currently consulting on a revised national planning policy framework, https://www.gov.uk/government/consultations/national-planning-policy-framework-proposed-reforms-and-other-changes-to-the-planning-system which seeks views on the limited instances in which site-specific viability assessment may be justified.

Laying the foundations for a more effective section 106 system

While this immediate action is necessary to overcome current challenges facing the section 106 market in order to reduce disruption to house building and sustain supply, we are clear that this is a time limited, emergency intervention. The Government’s primary focus remains on long-term reform to reset the section 106 market and support effective section 106 delivery of social and affordable homes, and thereby honour our manifesto commitments.

We intend to work closely with LPAs, RPs and developers to deliver a series of measures that will provide for a simpler, more transparent and more resilient section 106 system, including:

Supporting LPAs to negotiate section 106 agreements. We want to simplify and strengthen the process for agreeing developer contributions through section 106 agreements at the application stage of new developments. It is our intention to publish a template section 106 agreement to speed up the process of drafting and concluding new section 106 agreements.



Setting clear sector expectations to guide section 106 delivery. We want to provide greater clarity and certainty to facilitate the more effective delivery of section 106 homes. Through new guidance we will seek to foster early engagement and collaboration between developers and RPs; provide greater clarity on the standards section 106 homes must meet and the role that should be afforded to RPs in ensuring section 106 homes meet the standards required of social and affordable housing; and encourage standardisation across the market in respect of how pricing is negotiated so as to provide more certainty for RPs and developers on what they can expect to pay and accept for section 106 units.

Expanding financial capacity to revive the market for section 106 homes. Low-interest loans will be made available to private registered providers of social housing. They will be administered by the national housing bank outside London and the Greater London Authority in London. Up to 10% of the £2.5 billion low-interest loan scheme for private registered providers will be available to support the delivery of social and affordable homes via section 106. Further detail on low-interest loans is set out in our decade of renewal update. We will also build on the recently extended affordable homes guarantee scheme 2020, and confirmation of its use for section 106s. We will continue to explore how Government can crowd in additional private investment to enable the purchase of unsold section 106 units. This is with the aim of bringing them into use while retaining them as regulated affordable housing, for example through an affordable housing acquisition vehicle supported by debt guarantees which is able to buy section 106 homes.

We will set out further detail in due course with the intention of this full reset being in force in spring 2026. The Government’s full policy statement has also been published today.

[HCWS1286]

Commonhold and Leasehold Reform

Matthew Pennycook Excerpts

Tuesday 27th January 2026 Written Statements

[The Minister for Housing and Planning (Matthew Pennycook)]

As a Government, we made a clear and unambiguous commitment in our manifesto to act where previous Governments had failed by finally bringing the feudal leasehold system to an end. We did so on the basis of a firm conviction that it is only by extinguishing fully the historical iniquities on which the present leasehold system rests that we can ensure that the dream of home ownership is made real for millions of households across the country.

Today the Government have published the Commonhold and Leasehold Reform Bill in draft for pre-legislative scrutiny by the Housing, Communities and Local Government Select Committee. This historic moment marks the beginning of the end for the feudal leasehold system that has tainted the dream of home ownership for so many.

The draft Bill will transform the experience of home ownership for millions of leaseholders across the country, modernise property law and deliver a modern housing market. It includes the following key provisions:

A new legal framework for commonhold to reform and reinvigorate this radical improvement on leasehold ownership;

A statutory restriction on new leasehold flats to ensure that in future commonhold is the default tenure;

A new process for converting to commonhold, aligned with wider enfranchisement processes to make conversion possible when at least 50% of qualifying leaseholders agree;

The abolition of leasehold forfeiture as a means of ensuring compliance with a lease agreement and its replacement with a fairer system;

The repeal of draconian powers relating to rent charges on freehold estates; and

The capping of ground rent for older leases at £250 per year, changing to a peppercorn after 40 years.

Reinvigorating commonhold

The draft Bill builds on the publication of the commonhold White Paper in March last year, which confirmed the detail of our commonhold reform programme and responded to the Law Commission thorough and expert review of commonhold law.

Commonhold is a modern home ownership structure that is used widely around the world. It is not merely an alternative to leasehold ownership, but a radical improvement on it. At the heart of the commonhold model is a simple principle: the people who should own buildings, and who should exercise control over their management, shared facilities and related costs, are not third-party landlords but the people who live in flats within them and have a direct stake in their upkeep.

In enabling flats to be owned on a freehold basis, commonhold ensures that the interests of homeowners are preserved in perpetuity rather than their value depreciating over time as it does under leasehold, and it transfers decision-making powers to homeowners so they will have a greater say over how their home is managed and the bills they pay, as well as flexibility to respond to the changing needs of their building and its residents.

Commonhold was introduced in England and Wales in 2004 through the Commonhold and Leasehold Reform Act 2002, but for a variety of reasons it failed to establish itself and, as a result, there are fewer than 20 commonhold developments in existence today. The 2002 legal framework also quickly became outdated, owing to the fact it was ill-suited for use in larger or mixed-use developments.

The draft Bill will reinvigorate commonhold through the introduction of a comprehensive new legal framework based on the vast majority of the recommendations made by the Law Commission in its 2020 report. It will enable commonhold to be used in the widest possible range of settings, enhancing the rights and protections of consumers while also supporting the needs of developers and lenders.

Banning new leasehold flats

To ensure that commonhold becomes the default tenure, the draft Bill also includes provisions to ban the use of leasehold for new flats. Once enacted, this will ensure that, other than in exceptional circumstances, all flats are provided as commonhold, as is the case in large parts of the world. The provisions in the draft Bill are intended to work in tandem with the ban on the use of leasehold for new houses contained in the Leasehold and Freehold Reform Act 2024.

Alongside publication of the draft Bill today, we have published a “Moving to commonhold” consultation, seeking input from industry and consumers on precisely how we implement the new ban. The feedback received will ensure that we can proceed with a smooth transition to commonhold for new flats, while at the same time protecting the supply of new homes and determining whether there is a case for any justified exemptions.

Facilitating commonhold conversion

The draft Bill also includes measures to make it easier for existing leaseholders to convert their buildings to commonhold. The relevant provisions respond to proposals made by the Law Commission to make conversion more accessible by reducing the consent threshold for conversion.

The existing law sets out a process for conversion, but it is one that requires consent from everyone with an interest in the block. This sets an unacceptably high bar and means that commonhold is not achievable if even a single unit owner, lender or the existing freeholder objects. The draft Bill will introduce a new process for conversion—one that brings conversion into line with wider enfranchisement processes and will make conversion possible if at least 50% of qualifying leaseholders agree.

Abolishing forfeiture

The draft Bill also contains a number of vital reforms to the existing leasehold system that the previous Government’s Leasehold and Freehold Reform Act 2024 left untouched. Chief among them are provisions to end the disproportionate and draconian threat of forfeiture as a means of ensuring compliance with a lease agreement.

For too long, outdated forfeiture laws have allowed landlords to threaten people with losing their home and hard-earned equity over small debts of as little as £350, or any amount if left unpaid for three years. The draft Bill contains provisions to abolish forfeiture and introduce a modern, proportionate lease enforcement system that addresses breaches fairly, with appropriate safeguards and judicial oversight.

Repealing draconian powers relating to rent charges

To better protect homeowners on freehold estates, the draft Bill will repeal draconian enforcement powers that apply to estate rent charges on them. These powers, often difficult to find in deeds and poorly understood by buyers, can lead to rent charge owners taking possession of or granting a lease over a freehold home as a result of small sums outstanding. That is not just unfair, but creates real barriers to home ownership and property sales. The draft Bill will remove those powers and the unnecessary obstacles that drive up costs and uncertainty for freehold estate homeowners.

Capping ground rent

The Government are acutely aware that the cost of living remains a pressing concern for leaseholders across England and Wales and that those who remain subject to unfair and unreasonable practices need urgent relief.

That is why last summer we consulted, jointly with the Welsh Government, on a range of proposals to hold landlords and managing agents to account for the services they provide and the charges and fees they levy. At the heart of that consultation were measures to increase transparency over service charges and enhance access to redress, but it also included proposals to reform the section 20 “major works” procedure and strengthen regulation of managing agents. We thank all those who responded to the consultation and will set out details of how we intend to implement the measures in question as soon as possible.

However, the Government are determined to go further to alleviate the cost of living pressures facing leaseholders. In our manifesto, we committed to tackling unregulated and unaffordable ground rent charges, and the draft Bill honours that commitment.

Historically, ground rents, which often entail no service being provided whatsoever, were of low or nominal value. However, over the past two decades a practice has developed of freeholders including high and escalating ground rent clauses in leases. Such clauses are causing leaseholders considerable financial strain, and some are unable to sell or remortgage their properties as a result.

The draft Bill will cap ground rents at £250 per year initially, changing to a peppercorn after 40 years. This approach, which will apply to most long residential leases not already covered by existing legislation, will provide immediate financial relief for leaseholders with high and harmful ground rents, helping to support leaseholders currently struggling to get a mortgage, and removing unnecessary blockers to buying and selling. The longer-term change to a peppercorn cap will eliminate the two-tier market between new and older leases, delivering a fair and efficient modern housing market.

These reforms will necessarily have effects on existing contractual arrangements and investments, something that this Government do not undertake lightly. However, the Government have a mandate to tackle unregulated and unaffordable ground rent charges, and our approach has been designed to strike a fair balance between the interests of leaseholders, freeholders and investors, maintaining the reputation of the UK as a safe place to invest.

Rectifying flaws in the Leasehold and Freehold Reform Act 2024

As set out in a previous written ministerial statement I made on this subject —[Official Report, 21 November 2024; Vol. 757, c. 24WS.]—(HCWS244), the 2024 Act contains a small number of specific but serious flaws that prevent certain provisions from operating as intended and that need to be rectified via primary legislation.

Although this is not included in the draft Bill, our intention is to rectify those flaws in primary legislation. Among other things, this will allow us to commence the 2024 Act’s enfranchisement provisions. Valuation rates used to calculate the enfranchisement premium will be set by the Secretary of State in secondary legislation. We will consult on valuation rates as soon as possible, ahead of commencing the relevant provisions.

[HCWS1278]

Commonhold and Leasehold Reform

Matthew Pennycook Excerpts

Tuesday 27th January 2026 Commons Chamber

[The Minister for Housing and Planning (Matthew Pennycook)]

My Department always strives to ensure that the House is updated at the earliest possible opportunity. I note and appreciate fully the points you have made, Mr Speaker, and will ensure that they are passed on to my ministerial colleagues.

With your permission, Mr Speaker, I would like to make a statement on the Government’s draft Commonhold and Leasehold Reform Bill. We made a clear and unambiguous commitment in our manifesto to act where previous Governments had failed and finally bring the feudal leasehold system to an end. We did so on the basis of a firm conviction that it is only by extinguishing fully the historical iniquities on which the present leasehold system rests that we can ensure that the dream of home ownership is made real for millions of households across the country.

Today, the Government have published and laid the Commonhold and Leasehold Reform Bill in draft for pre-legislative scrutiny by the Housing, Communities and Local Government Select Committee. This ambitious piece of legislation will modernise property law, deliver a fair and efficient modern housing market and, most importantly, transform the experience of home ownership for millions of leaseholders across the country.

The draft Bill includes the following key provisions: a new legal framework for commonhold to reform and reinvigorate this radical improvement on leasehold ownership; a statutory restriction on new leasehold flats to ensure that, in future, commonhold is the default tenure; a new process for converting to commonhold from leasehold to make conversion easier, so that more homeowners can enjoy this improved form of ownership; the abolition of leasehold forfeiture and its replacement with a fairer system of lease enforcement; the repeal of draconian powers relating to rent charges on freehold estates; and the capping of ground rent for older leases at £250 a year, changing to a peppercorn after 40 years.

Let me expand briefly on each of these core measures, beginning with commonhold. Commonhold is a modern home ownership structure that is widely used around the world. It is not merely an alternative to leasehold ownership, but a radical improvement on it. At the heart of the commonhold model is a simple principle: the people who should own buildings and who should exercise control over their management, shared facilities and related costs are not third-party landlords, but the people who live in the flats within them and who have a direct stake in their upkeep. Commonhold ensure that the interests of homeowners are preserved in perpetuity. It transfers decision making to them so that homeowners have a greater say over how their home is managed and the bills they pay, as well as the flexibility to respond to the changing needs of their building and its residents.

For a variety of reasons, commonhold failed to establish itself following its introduction in 2004. As a result, there are fewer than 20 commonhold developments in existence today and the 2002 legal framework is hopelessly outdated. The provisions in the draft Bill build on the publication of our commonhold White Paper in March last year, which confirmed the detail of our commonhold reform programme, and responded to the Law Commission’s thorough and expert review of commonhold law. The result is legislation that will reinvigorate commonhold through the introduction of a comprehensive new legal framework that will enable commonhold to be used in the widest possible range of settings.

To ensure that commonhold becomes the default tenure, as our manifesto promised, the draft Bill also includes provisions to ban the use of leasehold for new flats. Once enacted, this will ensure that, other than in exceptional circumstances, all flats are provided as commonhold. The provisions will work in tandem with the ban on the use of leasehold for new houses contained in the Leasehold and Freehold Reform Act 2024.

Alongside the publication of the draft Bill today, we are publishing a “Moving to commonhold” consultation, seeking input from industry and consumers on precisely how we implement the new ban. The feedback we receive will ensure that we can proceed with a smooth transition to commonhold for new developments, while at the same time protecting the supply of new homes and determining whether there is a case for any justified exemptions.

The draft Bill also includes measures to make it easier for existing leaseholders to convert their buildings to commonhold. The existing law already sets out a process for conversion, but it is one that requires consent from everyone with an interest in the block. This sets an unacceptably high bar and means that commonhold is not achievable if even a single unit owner, lender or the existing freeholder objects. The draft Bill will introduce a new process for conversion, one that brings conversion into line with wider enfranchisement processes and will make conversion possible if at least 50% of qualifying leaseholders agree.

The previous Government’s Leasehold and Freehold Reform Act does provide leaseholders with important rights and protections, but on the Labour Benches we have always maintained that it was a distinctly unambitious piece of legislation that left untouched serious problems, including the disproportionate and draconian threat of forfeiture as a means of ensuring compliance with a lease agreement. For too long, outdated forfeiture laws have allowed landlords to threaten people with losing their home and hard-earned equity over small debts of as little as £350, or any amount if left unpaid for three years. The draft Bill contains provisions to abolish forfeiture and replace it with a modern, proportionate lease enforcement system that addresses breaches fairly, with appropriate safeguards and judicial oversight.

Mr Speaker, you will know that before Christmas we launched two comprehensive consultations, seeking views on how best to implement new consumer protections for homeowners on freehold estates and the ways in which we might reduce the prevalence of privately managed estates over the coming years. To further enhance protections for homeowners on freehold estates, the draft Bill will also repeal enforcement powers that apply to estate rent charges on them. These powers, often difficult to find in deeds and poorly understood by buyers, can lead to rent charge owners taking possession of, or granting a lease over, a freehold home as a result of small sums outstanding. That is not just unfair; it creates real barriers to home ownership and property sales. We will remove these wholly disproportionate and outdated remedies for enforcing rent charges by repealing sections 121 and 122 of the Law of Property Act 1925, including estate rent charges.

The Government are acutely aware that the cost of living remains a pressing concern for leaseholders across England and Wales, and that those who remain subject to unfair and unreasonable practices need urgent relief. That is why last summer we consulted jointly with the Welsh Government on strengthening leaseholder protections over charges and services. That consultation included proposals to reform the section 20 major works procedure, increase transparency over service charges, and enhance access to redress through the relevant provisions in the Act. We thank all those who responded to the consultation and will set out details of how we intend to implement the measures in question as soon as possible. However, the Government are determined to go further to alleviate the cost of living pressures facing leaseholders. In our manifesto, we promised to tackle unregulated and unaffordable ground rent charges. The draft Bill honours that commitment.

As the House will know, historically, ground rents, which often entail no service being provided whatsoever, were of low or nominal value. However, over the past two decades a practice has developed of freeholders including high and escalating ground rent clauses in leases. Such clauses are causing leaseholders considerable financial strain and some are unable to sell or remortgage their properties as a result. The draft Bill will cap ground rents at £250 a year initially, changing to a peppercorn after 40 years. This will provide immediate financial relief for leaseholders with high and harmful ground rents, while the longer-term change to a peppercorn cap will eliminate the two-tier market between new and older leases, delivering a fair and efficient modern housing market.

The reforms will necessarily have effects on existing contractual arrangements and investments—something that the Government do not undertake lightly. However, the Government have a clear mandate to tackle unregulated and unaffordable ground rent charges, and our approach has been designed to strike a fair balance between the interests of leaseholders, freeholders and investors, maintaining the reputation of the UK as a safe place to invest.

Finally, as I have made clear to the House on previous occasions, the last Government’s Leasehold and Freehold Reform Act contains a number of specific but serious flaws that prevent certain provisions from operating as intended and that need to be rectified via primary legislation. While not included in the draft Bill, our intention is to rectify those flaws in primary legislation. Among other things, that will allow us to commence the 2024 Act’s enfranchisement provisions, making it cheaper and easier for leaseholders to extend their lease or buy their freehold.

To conclude, the publication of the draft Bill today is an historic moment. It marks the beginning of the end for the feudal leasehold system that has tainted the dream of home ownership for so many. I look forward to working closely with the Select Committee as it performs its invaluable role of scrutinising carefully this draft legislation, and I encourage hon. Members across the House to engage with it and the accompanying consultation on banning new leasehold flats. I commend the statement to the House.

[Mr Speaker]

I call the shadow Minister.

[Gareth Bacon (Orpington) (Con)]

I thank the Minister for his remarks and for advance sight of his statement. Progress on leasehold reform is to be welcomed. Labour promised that when it stood for election 18 months ago, so it is about time it got on with it, as the previous Conservative Government had started to do.

The previous Conservative Government began the process of fundamental reforms to the existing system of leaseholds by making it easier to extend a lease or to buy a freehold, increasing the standard lease extension time to 990 years, and giving leaseholders greater transparency over their service charges. His Majesty’s Opposition remain committed to giving leaseholders a fair deal, want householders to have security for the future and will continue to hold the Government to account on that.

The Government made big promises to leaseholders at the last election. Do they believe that the Bill is the summit of their ambitions? What about the Leasehold and Freehold Reform Act 2024? What are their plans to implement secondary legislation? There are opportunities to improve leaseholder situations that are available to the Government now. Why have they not implemented those changes? Surely, if they were serious about reform for leaseholders, they would have picked up the 2024 Act and run with it, rather than doing nothing until now. The Minister just said:

“I have made clear to the House on previous occasions, the last Government’s Leasehold and Freehold Reform Act contains a number of specific but serious flaws that prevent certain provisions from operating as intended and that need to be rectified via primary legislation.”

He went on to say:

“While not included in the draft Bill, our intention is to rectify those flaws in primary legislation.”

Perhaps he could tell us what those flaws are. If the Government have already identified them, why are the corrections not included in the forthcoming Bill? Surely now would be the time to rectify them. So if not now, when?

I would be remiss not to comment on one of the central principles of housing reform: there actually needs to be some housing in order to reform it. The Labour Mayor of London is delivering the lowest house building in London since 2009, while Labour’s national housing delivery is nowhere near where it needs to be to meet its 1.5 million homes target. What is Labour doing to ensure that there are strong incentives to build more? Where is the second planning Bill that the Government briefed out to the media that they will need to introduce because of their failure to get the planning reform right first time? The Conservative party is pro-development, which is why we have announced both a plan to review the London plan to improve on Labour’s failings in London and to ensure that national development is done on a brownfield-first approach.

Now, it is true that ground rent is an additional cost to leaseholders, but it is reported that the Chancellor is against capping ground rents because she believes it will deter pension fund investors. What does the Minister have to say to that?

The Government are claiming that these measures will reduce people’s bills, which would of course be welcome, but if leaseholder ground rent bills are simply replaced by soaring council tax bills, with some local councils now facing more than 30% rises in council tax due the Government’s grossly unfair funding review, how will people be better off? In inner London, which has a high proportion of leasehold flats, residents in councils such as Wandsworth, Westminster and Kensington and Chelsea are facing the double whammy of staggering rises in council tax and a council tax surcharge on top. Are the Government in fact claiming to cut a cost on one hand, while knowingly replacing it with even more costs on the other?

I would be grateful if the Minister answered those points in his reply. We will scrutinise the Government’s forthcoming commonhold and leasehold reform Bill, and we will hold the Government to account on their promises on leasehold reform and housing. We look forward to studying the details, and to the debates that will follow.

[Matthew Pennycook]

I note the initial positive tone from the shadow Minister in welcoming the draft Bill. I am slightly reluctant, on what is usually a matter of cross-party consensus, to be too critical of him, but it is a bit rich to criticise this Government, given that the previous Government cherry-picked reform in a way that was at odds with the Law Commission’s recommendation to treat all three of its reports as a holistic package, and left us with an Act that we will have to make a series of changes through primary legislation to fix so that we can implement the remaining provisions. I will, therefore, not take any strictures on ambition from the shadow Minister when it comes to leasehold reform.

I say plainly to the shadow Minister that we have switched on a number of the 2024 Act’s provisions already. On coming into office, we immediately enacted a series of provisions on rent charge arrears, building safety legal costs, and the work of professional insolvency practitioners. On 31 October we enacted further building safety measures; on 31 January we switched on the two-year qualifying exemptions for leaseholders; in March we switched on the right-to-manage provisions; and we are working at pace to take forward the rest of the significant package of secondary legislation that was required. However, some parts of those provisions require us to make fixes to the Bill—sadly, something that the previous Government left us with.

The shadow Minister mentioned housing supply, but again, I am loath to take lessons from a party that torpedoed housing supply in the last Parliament by making a series of anti-supply changes to the national planning policy framework, including the abolition of mandatory housing targets. The shadow Minister’s criticism could be taken a little more seriously if his colleagues did not come to me week in, week out, objecting to housing applications, telling me how our reforms will make it more permissive in their local constituencies.

We are getting on and taking forward the reforms to the leasehold system that are already on the statute book. Through this Bill, we are bringing forward the wider reforms necessary to bring that system to an end, which will be to the lasting benefit of millions of leaseholders across the country.

[Mr Speaker]

I call the Chair of the Housing, Communities and Local Government Committee.

[Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)]

I pay tribute to the Minister for his hard work in getting us to this stage. There were a few occasions when he saw me and went the other way, because he knew what I was going to ask him, but we would not be here without his tireless work. I also highlight what the Minister said about this being a cross-party issue, and pay tribute to the former Member for Worthing West, Sir Peter Bottomley, for his work chairing the all-party parliamentary group on leasehold and commonhold reform.

For far too long, many leaseholders up and down the country have been caught up in this medieval system, leaving them with soaring rents and unreasonable fees—people who bought their homes in good faith and have seen a nightmare transpire. It is right that the Government are finally bringing in a change that will help millions of people up and down the country. The Minister has agreed to support the Committee’s inquiry with the necessary evidence. Can he also confirm that he will support us by providing the Government’s response to the 2023 ground rent consultation in the coming days, so that we can get a better understanding on how that underpins the Government’s decision to cap ground rents at £250?

There were some things that we were expecting to see in the draft Bill—yes, I have read it—that are not there, including the Law Commission’s unimplemented recommendations on enfranchisement and the right to manage, and Lord Best’s recommendations on managing agents. Lord Best has called for a regulator with teeth for proper enforcement; can the Minister clarify what work the Government are doing to ensure that this will be in the final version of the Bill, or if it will be addressed elsewhere? The Minister also outlined a rough timeline for implementation. Can we get more clarity on when we expect to see that, so that those leaseholders around the country who have been waiting for a long time will finally get the help that they desperately need?

[Matthew Pennycook]

I thank my hon. Friend, the Chair of the Housing, Communities and Local Government Committee, for those fair and pertinent questions. I will answer each of them in turn. We published a whole series of documents at 7 am, including a copy of the draft Bill. That also included a policy document setting out our rationale for the £250 per year ground rent cap, but we will make available to the Committee other information, evidence and documentation as needed and at the earliest possible opportunity.

As for the other recommendations made in the three reports from the Law Commission, the Leasehold and Freehold Reform Act 2024 implemented a significant number of the Law Commission’s enfranchisement recommendations, a small number of its right-to-manage recommendations, and none of its recommendations on commonhold. We cannot do everything in this Bill; hon. Members who have had a chance to look will have seen that is has a large number of clauses already. But we are committed to enacting those remaining recommendations relating to leasehold enfranchisement and other things over the course of the Parliament.

On implementation, different provisions will come into effect at different times. For example, we aim to switch on the rent charge provisions I described soon after Royal Assent. Other measures will require secondary legislation. We expect the ground rent cap to be in place in 2028. We will work with the Committee to ensure that it can do the fullest and most robust job possible when it comes to giving the Bill the enhanced scrutiny it deserves.

[Mr Speaker]

I call the Liberal Democrat spokesperson.

[Gideon Amos (Taunton and Wellington) (LD)]

The Liberal Democrats welcome the introduction of a commonhold framework, the abolition of leasehold for newbuild flats, and the end of forfeiture—all these are positive steps in the right direction. Our manifesto has been calling for an end to unfair residential leaseholds since Lloyd George called it “blackmail” in his 1909 People’s Budget. But while I welcome those measures, we should be going much further.

The Housing Secretary this morning called ground rents “money for nothing” and a “scam”, so why should leaseholders continue to pay £250 for nothing? The Government’s proposals need to go further. For freeholders trapped in the fleece-hold of unscrupulous property management companies, the blackmail of the great property rip-off is set to continue. There is nothing that will cap those charges in these proposals. Since residential leaseholds will still be with us for some time, millions of leaseholders need better protection from landlord costs being passed on to them. They need the capping of excessive service charges, like £400 to change a lightbulb and £4,000 to mow the grass. Help is also needed for those trapped in unsafe and defective buildings, hundreds of thousands of which are excluded from the building safety regime.

Will the Minister take forward Liberal Democrat proposals and immediately abolish residential leasehold charges, set ground rents at a peppercorn now, and regulate property and estate-management companies as recommended in the Best report, capping unreasonable service and estate management charges?

[Matthew Pennycook]

I thank the Liberal Democrat spokesman for those questions. He often mentions Lloyd George, and I share his passion for Lloyd George’s radicalism on property law and other measures. I will address the specific points that he raised. During the passage of the Leasehold and Freehold Reform Act 2024, I was clear that my instinctive preference when it comes to ground rents was for a peppercorn cap, fully eliminating ground rents. The changes that we are making ensure that, after 40 years, that change occurs.

Having considered all the analysis and advice available to me as a Minister, including the evidence gathered in response to the previous Administration’s 2023 consultation, I believe that we have set out the right policy. It is clear that an immediate peppercorn cap would carry significant risks, including some that might impact on leaseholders. The Government also recognise that there is a significant difference between regulating the creation of new leases, and intervening to affect existing contracts and investments.

On the functioning of the cap itself, I want to make clear that it is a maximum cash cap. If someone’s lease is below £250 and does not include escalating clauses, their ground rent will not rise to £250. If someone’s ground rent is over £250, at the point that the measures are brought into force they will see an immediate reduction. That will benefit millions of leaseholders across the country. It is a huge cost-of-living intervention, and I hope the House can get behind it as the most just and proportionate way of addressing unregulated and unaffordable ground rent terms.

The hon. Member for Taunton and Wellington (Gideon Amos) will know that we ran a consultation last year on how we can standardise service charges and increase their transparency to ensure that leaseholders can better challenge the reasonableness of service charges at tribunal. However, we do not intend to bring forward a cap, not least because doing so could harm leaseholders, particularly those in enfranchised buildings, who may need to raise sums beyond the cap to carry out essential maintenance works on their buildings.

[Angela Rayner (Ashton-under-Lyne) (Lab)]

I thank my hon. Friend for this extremely welcome statement. I know how much work he has put into this. We know, however, that vested interests have repeatedly resorted to lawfare to block such measures, and may do so again; we have already seen the scaremongering begin, with outrageous claims that these changes will impact on lifesaving building safety work. Can my hon. Friend reassure me that the Government will not waver in the face of such threats, but stand firm and ensure that the will of this Parliament prevails? I take exception to objections from those on the Opposition Benches, who did nothing on rent caps in their time in Parliament.

[Matthew Pennycook]

I thank my right hon. Friend for her kind words. She was an incredible champion of the reform agenda for this legislation when she served as Secretary of State. She raises the matter of vested interests. I hope that the House—and you, Mr Speaker—will take from the Government’s robust defence to the legal challenge brought against the 2024 Act by a group of claimants who are owners of freehold and other arising interests of dwellings that we will robustly defend the legislation. The High Court, incidentally, comprehensively dismissed that challenge, allowing us in due course to take forward the relevant provisions. I simply say to my right hon. Friend—who embodies this herself, so she is well aware—that taking on vested interests that are opposed to change that will bring about improvements in the lives of working people is what Labour Governments do.

[Lewis Cocking (Broxbourne) (Con)]

As a leaseholder, I understand the issues that leaseholders face, and I look forward to carrying out pre-legislative scrutiny on the HCLG Committee. The conveyancing process also needs to be looked at, as I am not sure that solicitors and managing agents point out considerations such as historical service charges, whether the property has a sinking fund and how much service charges have gone up. Will the Minister assure me and my constituents that that part of the process of buying a leasehold property will also be looked at within this legislation?

[Matthew Pennycook]

I have a lot of respect for the hon. Gentleman and his service on the Select Committee. He has a lot of expertise in this area. I would say two things in response. First, we published two consultations on the home buying and selling process to try to modernise that process, and we are looking at some of those issues as part of that. Secondly, on service charges, one reason we had to hold quite a complicated and technical consultation on the implementation of the 2024 Act’s service charge provisions is precisely the complexity and the number of factors to deal with. We received incredibly useful feedback in response to that consultation, and that will shape how we take those measures forward. I want to be clear, though, that we are talking about how and not whether we take those measures forward; I want to see them brought forward at the earliest possible opportunity, because we absolutely know the impact that high and rising service charges are having on leaseholders across the country.

[Navendu Mishra (Stockport) (Lab)]

People in Stockport and Greater Manchester have suffered for many years with poor service and unfair treatment by managing agents. Does the commitment by the Government to protect leaseholders mark a break from years of weak regulation by the coalition and then Conservative Governments?

[Matthew Pennycook]

We did see a considerable amount of deregulation under the coalition Government and their successors. I will give the previous Government credit, as I have done before, for bringing forward the 2024 Act; it does include some limited relief for leaseholders and some new rights and protections. However, we need to take it forward and finish the job, as I made clear in opposition that Labour would. As I said, we are consulting on changes to increase protections over service charges—incidentally, that same consultation included a number of proposals recommended by Lord Best in his 2019 report, “Regulation of Property Agents”, including the introduction of mandatory qualifications for managing agents. We are clear, though, that that consultation and the measures within it are not the final step in the regulation of managing agents, and we will continue to reflect on the various other recommendations made in Lord Best’s report.

[Mr Gagan Mohindra (South West Hertfordshire) (Con)]

Unlike the Chair of our Select Committee, the hon. Member for Vauxhall and Camberwell Green (Florence Eshalomi), I have not read the full draft legislation published at 7 o’clock this morning. I can confirm that she did indeed feel a bit unloved whenever she saw the Minister running away from her. On the statement, I think the Minister referred, in a previous answer, to ground rents and the transition from £250 to a peppercorn being effective in 2028. At the point that it becomes effective, will he look to backdate it or will tenants have to continue to pay their bills up until the legislation becomes effective?

[Matthew Pennycook]

The House can, of course, help us to speed up the progress of the Bill; 2028 is only a rough estimate based on the time it will take for the Bill, once it has passed its draft phase and scrutiny from the Select Committee, to be introduced in its final form and to get through both Houses. We will then also have to switch on the necessary secondary legislation. Up until that point, people will continue to pay their existing ground rents, but, as I say, the cap will apply once we bring those measures into force. For lots and lots of leaseholders around the country—I am sure the hon. Gentleman has many in his constituency—who are paying onerous, high ground rent terms way above £250, that will be an immediate financial relief that will be hugely beneficial to them.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

Since I was first elected in 2010, I have seen the misery caused for constituents in Great Park, Moorfields and Grove Park, who suffer high ground rents, hikes in service charges, threats of forfeiture and a total lack of accountability of the maintenance companies. I therefore strongly welcome today’s announcements and truly thank the Minister for listening to calls for change. However, many will still find themselves living in existing leasehold houses and will remain trapped in this old, unfair and very frustrating system. They are asking me what the Government will do next to support them. Could the Minister explain that?

[Matthew Pennycook]

I am more than happy to have a separate conversation with my hon. Friend about the specific conditions pertaining to leasehold houses. She will know, of course, that the Leasehold Reform (Ground Rent) Act 2022 made a number of changes in that area. In general, we want to arrive at a situation, once our reform agenda is enacted, where existing leaseholders can choose to remain in leasehold ownership but can take advantage of the new rights and protections made available to them, including a cheaper and easier enfranchisement process if they want to extend their lease or buy their freehold, or convert to commonhold. That is why it is so important that the Bill contains an easier mechanism to convert to commonhold, which, as I said in the statement, we are clear is not only an alternative to leasehold ownership but a radical improvement on it.

[Mr Lee Dillon (Newbury) (LD)]

I welcome the introduction of this draft Bill and, as a member of the Housing, Communities and Local Government Committee, I look forward to scrutinising it. I wonder whether the Minister will make available to the Committee evidence around the peppercorn rent and the 40-year requirement. I suspect is to do with investor confidence, but could that time period be brought forward? My overarching feeling, which I know will be reflected in my inbox when I get back to my office, is that people across the country would have expected to see within the draft Bill action on service charges; we are consistently contacted about managing agents not performing their duties and charging too much for it. The Bill was meant to be presented at the back end of last year and I know that the Government concluded a consultation in September. We want service charges to be addressed as soon as possible. Will we be able to get an additional clause on this issue into this legislation?

[Mr Speaker]

Order. Can I gently say that I want to get everybody in, but I cannot do so if people are going to make longer contributions? I know there is a 40-year clause in the legislation hon. Members are discussing—I don’t want us to hit that today!

[Matthew Pennycook]

It is clear that this draft Bill cannot do absolutely everything, and it is the Government’s considered opinion that we do not need provisions on service charges in this Bill—not least because, for the reasons I have set out, we do not intend to implement a service charge cap—and that the provisions in the 2024 Act will do the job. Help is on the way, though, and I want to ensure that those provisions are switched on at the earliest possible opportunity.

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

First, I congratulate my hon. Friend the Minister on the magnificent job he has done with this legislation, as well as the Chair of the Housing, Communities and Local Government Committee, my hon. Friend the Member for Vauxhall and Camberwell Green (Florence Eshalomi), who has pushed him and bothered him all the way down the corridors for months on end!

It is now eight years since the previous Committee looked at this matter and recommended radical reform of leasehold. One of the challenges in my constituency—still—concerns individual householders who try to buy their freehold and find that the freeholders will not even respond to their requests, and then push them through complicated and expensive procedures before they can get their entitlements. Can the Minister give us an assurance that that procedure will now be simplified and cheapened?

[Matthew Pennycook]

I thank my hon. Friend for his kind words on my role in developing the draft Bill. I can say to him very plainly: yes. If he looks at the consultation on service charge protections that we released last summer, he will see proposals that specifically address non-litigation costs and other measures. However, as I said, it is our intention to ensure that in the enfranchisement process, it is not only cheaper but easier for leaseholders to make use of their new rights and protections if they intend to buy their freehold or extend their lease.

[Mr Will Forster (Woking) (LD)]

I am pleased that the Government have finally published their plans to reform the leasehold system, and I look forward to scrutinising those plans on the Housing, Communities and Local Government Committee. In my constituency, we have a range of issues with property management companies, whether it be the mismanagement of the Clock Tower in Maybury or the proposed 30% increase in the service charge at Brookwood Farm, and all are unacceptable. Please will the Minister explain why he is not using the draft Bill to end the wild west of unregulated property companies?

--- Later in debate ---

[Matthew Pennycook]

We launched two comprehensive consultations before Christmas, in respect of how we switch on the consumer protections set out in the 2024 Act for those living on freehold estates and, more widely, on how we end the prevalence of private management arrangements of the kind that I think the hon. Member is referring to. The draft Bill does not have to do everything, but relief is on the way through the new consumer protections for those living on freehold estates who suffer from management companies levying unfair charges.

[Barry Gardiner (Brent West) (Lab)]

I congratulate my hon. Friend on resisting the calls from those who have exploited leaseholders for far too long and on capping ground rent. I welcome the assurance that we are moving from the outdated feudal system of leasehold to a proper commonhold future to give the full rights of ownership to leaseholders, but my hon. Friend will know that those who have taken money for no service or for poor service will resist this with all their might. A loophole may still exist for enfranchisement when developers put up a new building with a proportion of commercial property in its base, so can my hon. Friend address that, specifically in order to stop them using such a loophole?

[Matthew Pennycook]

My hon. Friend and I both served on the Public Bill Committee when the Bill that is now the 2024 Act was going through the House, and we discussed many of these issues then; I can assure him that we have given consideration to all of them. He is right that we are now on a path to a commonhold future. As I have said, this is a radical improvement on leasehold home ownership. In general, while we will obviously ensure that leaseholders who wish to remain under leasehold ownership benefit from new rights and protections, it is the Government’s intention to try to persuade as many leaseholders as possible to convert to commonhold and to enjoy the benefits that it provides.

[Rebecca Paul (Reigate) (Con)]

I thank the Minister for his statement, and for all his support with the issues we have had at Park25 in Redhill; I very much appreciate that he has taken residents’ concerns seriously. Which of the changes will be most beneficial for my Park25 residents, and has the Minister given any more thought to my suggestion of mandatory adoption of communal land by local authorities?

[Matthew Pennycook]

I must say, without getting into the detail of the circumstances of the hon. Lady’s constituents, it is hard to know which of the measures will benefit them most. If they are subject to high ground rent charges, the cap on introduction will benefit them hugely on its introduction. If they have suffered from the threat of forfeiture, which is a draconian and disproportionate means of enforcing lease terms, they will benefit in myriad ways from the legislation.

[Darren Paffey (Southampton Itchen) (Lab)]

I congratulate my hon. Friend on his statement and thank him for it. Like thousands of long-suffering leaseholders across Southampton Itchen, I warmly welcome this announcement. Residents of the Sapphire Court development have already been paying ground rent that is higher than the cap, and there is a plan to double it, but thanks to the action of this Labour Government that will not happen. How soon will Southampton’s leaseholders will get the rights, protections and securities that they have been waiting a long time for and that they deserve?

[Matthew Pennycook]

As I have said, it is the Government’s intention to ensure that the draft Bill, and the final product that eventually comes forward after scrutiny by the Select Committee, is made law as soon as possible so that leaseholders can benefit from the new provisions. In general terms, no one will pay more than the ground rent cap that we are introducing, but millions of people will pay less. Approximately 770,000 to 900,000 leaseholders with ground rents over £250 will see savings in this Parliament, and others will see savings in greater amounts in Parliaments to come.

[John Glen (Salisbury) (Con)]

I welcome the news of the capping of ground rents for existing contracts, and I thank the Minister for the time he gave me last year, but he will recognise that many city centre developments require ongoing investment from pension funds, so could he say a little more about how his announcement will not spook the City and how he will ensure that there continues to be a flow of investment into our high streets?

[Matthew Pennycook]

I thank the right hon. Member for his fair and reasonable question. The Government consider the intervention on ground rents that we are making through this draft Bill to be a justified and proportionate approach to the specific problems that leaseholders face as a result of high and harmful ground rents. We are introducing the reforms to deliver on specific commitments in our manifesto and in the context of a significant number of wider reforms to the leasehold market. We have carefully weighed the different options to meet our manifesto commitment on ground rents and we have taken investors’ concerns into account when developing the policy, which we believe strikes a fair balance between leaseholders, freeholders and those invested in ground rents. We recognise that the reforms will have a significant impact on freeholders and investors, but we consider this a justified and proportionate response.

[Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

I should first declare that I am a leaseholder. I welcome very warmly the Minister’s statement, particularly the measure on commonhold, which is something that we Co-op MPs have been campaigning on for a long time. We also welcome that the cap on ground rents is in sight. There are issues in my constituency relating to the fact that a lot of my leaseholders are shared owners. Could the Minister tell us now—or write to me with the details—how shared ownership might be impacted by the changes? Could he also reassure us, given the complexities, that there will be some Government support, such as an advice hub or something to point people in the right direction, when it comes to how people will move from where they are to commonhold?

[Matthew Pennycook]

I am more than happy to write to my hon. Friend about the issue of shared ownership specifically. She will know that through our £39 billion social and affordable homes programme, we are making improvements to shared ownership as a tenure model. More widely, I can assure her that the provisions in the draft Bill will benefit leaseholders in her constituency in the way that she makes clear. I am happy to have a further conversation with her about how the reforms will benefit her constituents and what advice leaseholders can draw on, including the Government-backed Leasehold Advisory Service.

[Mike Martin (Tunbridge Wells) (LD)]

I thank the Minister for announcing this Bill to Parliament, and I broadly welcome the provisions within it, particularly the proposal on conversion from leasehold to commonhold—I think that is excellent. By my count, there are about 4.8 million leaseholders in England. Do the Government envisage driving this process so that people are empowered and encouraged to make that conversion, and when does the Minister think that we will get rid of the last leasehold in England?

[Matthew Pennycook]

I think that leaseholds will exist for some time to come. Indeed, people in various buildings may not, for whatever reason, wish to convert to commonhold, but it is absolutely our intention to make it easier to do so and to encourage as many leasehold homeowners as possible to make the change, because it is a radical improvement on leasehold ownership, not just an alternative to it.

[Ben Coleman (Chelsea and Fulham) (Lab)]

Residents in Chelsea and Fulham have experienced years of poor service and unfair treatment from managing agents, so I know how pleased they will be by this Government’s determination to do the right thing by leaseholders after years of, sadly, weak regulation under the Conservatives. May I take this opportunity to tell my hon. Friend how much residents in Chelsea and Fulham are looking forward to the further steps on service charges and managing agents that he has outlined? More, please.

[Matthew Pennycook]

We are absolutely committed to strengthening regulation of managing agents. Some proposals on charges were set out in the consultation on protections for leaseholders, which we released last summer, but there is more to come.

[Charlie Dewhirst (Bridlington and The Wolds) (Con)]

Hundreds of thousands of freeholders up and down the country who are locked in financial arrangements with unaccountable estate management firms will be very frustrated by this statement, because it focuses solely on leasehold. Will the Minister very clearly set out the next steps to tackle this enormous travesty, which involves fleecehold and estate management companies?

[Matthew Pennycook]

I must correct the hon. Gentleman: it does not solely deal with leasehold, as I made clear in the statement. The draft Bill will repeal sections 121 and 122 of the Law of Property Act 1925, ending the disproportionate remedies that give rent charge owners access to a draconian enforcement regime on freehold estates. As I have said, we are doing more, through the two consultations launched before Christmas in particular, to give new consumer protections to those living on freehold estates. I hope the hon. Gentleman will take part in and respond to that consultation.

[Dame Nia Griffith (Llanelli) (Lab)]

The capping of ground rent at £250 will give certainty and relief to leaseholders in Llanelli, who face unpredictable and unjustifiable hikes in ground rent and for whom the reform simply cannot come soon enough. Will the Minister give us a bit more detail on the timetable for the Bill and assure us that he will do everything he possibly can to ensure that the cap is brought in as soon as possible?

[Matthew Pennycook]

I agree with my hon. Friend. She, like me, will have constituents who are subject to high, unfair ground rent charges and, in some cases, to escalating ground rent charges, particularly those that are inflation-linked. People across the country see those ground rent charges stack up to significant amounts and they will benefit from the cap once it is implemented. We estimate that the cap on ground rents will take approximately 12 months to introduce after Royal Assent, but that is all subject to parliamentary timings. If, as in the past, there is cross-party support on this issue, we can all work together to ensure that the Bill makes speedy progress.

[Carla Denyer (Bristol Central) (Green)]

Leaseholders in Bristol Central are being ripped off. I am disappointed that the Minister and the Government will not enforce peppercorn ground rents immediately, although a £250 cap is an improvement and the movement towards commonhold is really welcome. However, there are big problems for leaseholders that are still unaddressed. Will the Minister please commit to tackling the soaring insurance premiums that have left homes unmortgageable and leaseholders trapped, unable to sell and move in the wake of the cladding scandal?

[Matthew Pennycook]

I detected an unusual amount of support in that question from the hon. Lady, which I welcome. On the specific issue of insurance charges, again, there was a consultation on switching on some of the provisions in the 2024 Act that relate to insurance commissions. I am more than happy to write to her to set out further detail, but we need to bring those into force and it remains our commitment to do so at the earliest opportunity.

[Dr Lauren Sullivan (Gravesham) (Lab)]

I thank the Minister for the statement. Although, as he has pointed out, this cannot all be fixed in one go and there are other levers that he will put in place for leaseholders, will he give some reassurance to leaseholders in Gravesham who have experienced poor service that this is about rebalancing power so that they are protected going forward?

[Matthew Pennycook]

All manner of provisions in the draft Bill that we are discussing are absolutely about rebalancing leasehold and freehold interests. To take the example of forfeiture, freeholders have often been in an unassailable position of strength vis-à-vis leaseholders. That is what we are trying to address by introducing the Bill. I thank my hon. Friend for her support.

[Dr Kieran Mullan (Bexhill and Battle) (Con)]

I hesitate to add to the Minister’s in-tray, but he will know that we have existing protections of some sort for leaseholders and freeholders, as right as he is to want to go further. Residents in the Cooden area of my constituency have been sent letters by a company called Asset Invest Ltd demanding thousands of pounds, which it says is to regularise covenant breaches. That, to me, seems unjustified and has some of the hallmarks of the unregulated charges that leaseholders have faced in the past. This is probably an issue that affects MPs across the House. Will the Minister be so kind as to meet me to explore how we might address this issue as well?

[Matthew Pennycook]

I will happily meet the hon. Gentleman. As I have said, it is our intention as a Government to end the unjust and discriminatory practices from which leaseholders suffer. As I hope I have made clear, over the course of the Parliament we intend to end—finally, once and for all—this iniquitous system. That will take some time; it cannot happen overnight, but that is our intent. Leaseholders across the country, including those in his constituency and mine, will benefit from that.

[Dame Chi Onwurah (Newcastle upon Tyne Central and West) (Lab)]

I congratulate my hon. Friend on freeing so many of my constituents from the historical and, indeed, feudal injustice of the leasehold system. I urge him to ignore the clarion complaints of those freeholders who predicated their business model on the continued exploitation of working people through extortionate ground rents. The Minister is familiar with the predicament of my constituents who are unable to extend their leasehold or buy their freehold because of the actions of the St Mary Magdalene and Holy Jesus Trust. What hope can he offer them?

[Matthew Pennycook]

My hon. Friend is right: there will always be vested interests that resist reform of the nature that we are trying to take forward, just as there will always be naysayers out there for whom nothing we do is ever good enough. This package as a whole, as I have said, will end the leasehold system in its entirety and in a single Parliament. That will be a huge achievement for this Government and we will succeed on that basis where other Governments have failed.

I am aware of the specific issue my hon. Friend raises and we have had many discussions about it. The provisions to address it are not in the draft Bill, but my officials and I are giving serious consideration to how and where we will resolve the matter that my hon. Friend has campaigned on for so many years.

[Layla Moran (Oxford West and Abingdon) (LD)]

I welcome the Bill, but I take this opportunity to urge the Minister to go further and faster on rip-off service charges. That is the thing that is clogging up my inbox—so much so, in fact, that I will hold a service charges forum in Oxford in a few weeks’ time. One group in particular—social housing tenants—is under-protected. The Minister will know that under the 2024 Act, there is more transparency in their service charges, but they do not have anywhere near as strong a hand as others in seeking redress. Will he meet me following the forum so that I can relay to him the issues that my constituents, particularly the social housing tenants, are having?

[Matthew Pennycook]

I can feel the glare of my private office as I agree to meetings across the House, but I am happy to do so. The matters that the hon. Lady addresses are in the consultation we brought forward last year. It is an incredibly technical consultation on standardising and making more transparent service charges across the country, which are not uniform in any way as things stand. However, as I have said, we want to introduce those protections as soon as possible.

[Josh Dean (Hertford and Stortford) (Lab)]

Today, I think of one of the very first constituents I saw at one of my surgeries, who was trying to sell one of her leasehold properties just to help fund the care of her mother. Will the Minister take this opportunity to reassure my constituent that this Labour Government are on her side and are doing all they can to free her and others from what has become a nightmare?

[Matthew Pennycook]

I say to my hon. Friend that we are on his constituent’s side. It is because so many leaseholders across the country are suffering from unjust and discriminatory practices that we have to overhaul and ultimately end this feudal system.

[Josh Babarinde (Eastbourne) (LD)]

Eastbourne’s leaseholders are being ripped off. The current leaseholder landscape has bred an industry of property management companies, such as FirstPort and Eagerstates, that prey on powerless leaseholders by charging eye-watering service charges, making opaque calculations of those charges and bullying residents into submission. In failing to cap service charges, and without the 2024 transparency rules in place, today’s reforms still leave thousands of local leaseholders unprotected. When will the Minister finally crack down on exploitative property management companies?

[Matthew Pennycook]

I have made it clear to the House that we have already set out proposals to strengthen the regulation of managing agents. Those proposals are not the summit of our ambitions; there is more to come. I say to the hon. Gentleman and generally to the House that managing agents will play an even more important role as we progress towards a commonhold future. We must therefore end the abuse and poor service from unscrupulous managing agents that so many leaseholders face.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

I thank the Minister for his diligent work on this issue. I know that we all appreciate his expertise, as will my constituents in Walthamstow who are leaseholders with Clarion and who, in the last year, have seen their ground rents go up from £200 to £650 and now this year to £857, including an admin fee. What can the Minister say to reassure my constituents that there will not be loopholes in the cap and that we will ensure that all charges are included in the £250 limit?

[Matthew Pennycook]

It is certainly not our intention to allow any loopholes into the legislation. That is precisely why we have brought forward a draft Bill rather than a final product. Such is the complexity and technical nature of the reform we are enacting that the additional and enhanced scrutiny to be provided by the Housing, Communities and Local Government Committee will be invaluable.

[Tessa Munt (Wells and Mendip Hills) (LD)]

I welcome the Minister’s announcement and I know that it will bring some joy, particularly with the further announcements he is going to make later in the Parliament, to many of the residents in my part of the west country. May I draw his attention to the housing with care sector? I am talking not about those gated communities that have a caretaker or somebody who cuts the grass, but about charities such as the St Monica Trust that provide some affordable rents and shared ownership but mostly provide leasehold purchase with a guaranteed buy-back and resale. This gives them a way of updating their contracts for residents and maintaining affordability. These organisations are really concerned that there will be an unnuanced ban on new leasehold care-led retirement living apartments. What consideration has the Minister given to the housing with care sector having some protection, and his attention?

[Matthew Pennycook]

The draft Bill, as published, includes exemptions that mirror the ground rent exemptions for new leases entered into since 30 July 2022, based on that previous Act of Parliament, but we will consider through the pre-legislative scrutiny process whether other exemptions would be appropriate for a small number of leases granted for specialist purposes. I can assure the hon. Member that I have given consideration, and will give further consideration, to the matter she raises.

[Luke Murphy (Basingstoke) (Lab)]

Since I was elected, so many constituents have raised with me the absolute nightmare of being trapped in leasehold and fleecehold, so I wholeheartedly congratulate the Minister on the action he is announcing today, particularly on capping ground rent, ending leasehold flats and the transition to commonhold. On the transition to commonhold, previous Governments have attempted to make this easier. Will he say a bit more about what the Bill will do to ensure that this Government make the transition happen, rather than failing as previous Governments have done?

[Matthew Pennycook]

My hon. Friend is absolutely right. For various reasons, commonhold failed to take off after its introduction in 2004 and the legal framework is now hopelessly out of date. That is why we have to reform and reinvigorate commonhold as a tenure. We want to put in place an easier conversion mechanism. We have given a great amount of thought to the Law Commission’s recommendations in this area, and we have tried to strike the right balance to ensure that our approach meets those objectives, but my hon. Friend is more than welcome to contribute to the scrutiny process for the draft Bill outside the Select Committee, and I hope that the does so.

[Monica Harding (Esher and Walton) (LD)]

In my constituency, managing agents are still imposing excessive service charges with very little transparency. Flats in retirement developments often will not sell, even at well below the market value, and families are left paying deceased relatives’ service charges. Restrictive lease terms ban rentals, trapping those families with empty, unsaleable homes. I note the Minister’s commitment to the consultation on service charges, but will he hurry up with the action?

[Matthew Pennycook]

I can assure the hon. Lady that we are going as fast as we possibly can, but I hope she would not want us to follow the example of the previous Government, who rushed forward legislation that contained serious specific flaws that a future Government—this Government—would have to fix in due course.

[Rachael Maskell (York Central) (Lab/Co-op)]

Today’s announcement is life-changing for many of my constituents, and this is why we elect Labour Governments. I want to ask the Minister about residents in leasehold complexes, where decisions are often delayed because of absent landlords and Airbnb owners. Will he ensure that when decisions are being made about the transfer to commonhold, those who do not respond do not hold up the decision to make the transfer?

[Matthew Pennycook]

I very much agree with my hon. Friend that the draft Bill will be life-changing for leaseholders across the country, freeing them from the unjust and discriminatory practices that so many of them face, and from the financial cost of high ground rent terms. I am more than happy to write to her on the specific issue she raises. It is these nuanced points that we want to work through, and that is why we have brought forward a draft Bill for enhanced scrutiny.

[Munira Wilson (Twickenham) (LD)]

I welcome many of the Government’s announcements today. Across Twickenham, I hear regularly from leaseholders who suffer when service charges are jacked up without any notice or transparency, often for spurious maintenance issues. I note that the Minister has said that he does not want to cap service charges and that help will be on the way at some point, but he has refused to put a timeline on that. Why does he not use this Bill as a golden opportunity to bring forward Lord Best’s recommendations on having a property regulator that can look at this area in a nuanced and sensible way?

[Matthew Pennycook]

We have given serious consideration to how we will take forward Lord Best’s recommendations from his 2019 report and, as I have made clear, we are taking some of them forward already. This Bill introduces reform in a number of specific areas and, as I have said in response to previous questions, it does not need to do everything. There are other pieces of legislation, not least the 2024 Act, that do lots of the work that hon. Members are calling for, but we want to ensure that the whole agenda is a comprehensive one that benefits leaseholders in the way that the hon. Lady and I both want.

[Abtisam Mohamed (Sheffield Central) (Lab)]

I pay tribute to the Minister’s work, which I know will bring real relief to many of my constituents. However, leaseholders in the Riverside Exchange development are being blocked from securing their right to manage because of absentee leaseholders. This has left them trapped with eye-watering service charges, which have increased from £1,900 to £5,500. Can the Minister set out how the upcoming legislation will reform and reduce the minimum qualifying threshold for the right to manage, which is currently set at 50%?

[Matthew Pennycook]

My hon. Friend will be aware that there were very few provisions relating to the right to manage in the 2024 Act. We are committed to enacting the remaining Law Commission recommendations relating not only to the right to manage but to leasehold enfranchisement. I am more than happy to write to her to try to get at the specific issues she raises in relation to the building in her constituency.

[Mr Adnan Hussain (Blackburn) (Ind)]

I too welcome the Minister’s statement today on leasehold reform, but I must press him and ask him what the Government’s plans are in respect of service and maintenance charges, so that I can provide at least some reassurance to my constituents.

[Matthew Pennycook]

Hopefully the hon. Gentleman heard my answer to a previous question. We intend to switch on the 2024 Act provisions that standardise service charges and increase transparency around them, so that people can more easily challenge unreasonable charges at tribunal. I will not put a time on that, because I do not have an exact date in mind, but I can assure him and other Members across the House that we are working as fast as possible to bring forward the necessary protections to ensure that leaseholders are protected from high and rising service charges.

[Luke Myer (Middlesbrough South and East Cleveland) (Lab)]

I have heard from so many residents across Marton, Guisborough, Skelton, Hemlington Hall and elsewhere about issues with leasehold and fleecehold, so what message does the Minister have for my constituents that he will tackle both of those issues and protect my residents from unfair service charges?

[Matthew Pennycook]

As I have made clear, there are measures in this draft Bill that will provide enhanced protections for residential freeholders on freehold estates, but we are taking other action, and I refer him—as I have other hon. Members—to the two comprehensive consultations we launched before Christmas, one of which deals exclusively with switching on the consumer protections for those people living on freehold estates.

[Claire Young (Thornbury and Yate) (LD)]

My constituents trapped in fleecehold schemes—freeholders on privately managed estates—will still be exposed to escalating, unregulated service charges and have no way of ensuring that the work they are paying for is actually done. The Minister has talked about the consultation and promised that help is on the way, but can he promise protection from this exploitation for my constituents in this Parliament?

[Matthew Pennycook]

Yes.

[Preet Kaur Gill (Birmingham Edgbaston) (Lab/Co-op)]

I welcome this statement and congratulate the Minister. Does he agree that strengthening and simplifying the route to commonhold will shift power away from distant freeholders and back to residents, and that for leaseholders in Birmingham Edgbaston, this will mean control over service charges, repairs and management for the first time?

[Matthew Pennycook]

Absolutely. Commonhold is a purpose-built tenure designed specifically for people to own and manage a shared building without a third-party landlord and without a ground rent. We want to see its uptake grow significantly over this Parliament, and that is what the measures in this draft Bill are designed to provide for.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister very much for his statement. It is indeed a joy to have some good news in the Chamber for everyone out there, and we welcome that. Thank you for that, Minister, and for the Government’s proposals. The Government have an interest in Northern Ireland, and while homeowners in Northern Ireland have the ability to buy out leaseholds under the Ground Rents Act (Northern Ireland) 2001, that Act does not provide for a cap on ground rent in its calculations. Will the Minister undertake to discuss these proposals with the devolved regions to enable a blanket costing to apply UK-wide at this time of austerity?

[Matthew Pennycook]

I always thank the hon. Member for his constructive contributions. As he knows, England and Wales can learn lots from Northern Ireland, but, as ever—particularly in relation to our reforms to housing and planning, as well as to leasehold—there are many things that Northern Ireland can learn from our reforms. I can give him the undertaking that the devolved Administrations will be kept up to date with what we are doing.

[Steve Race (Exeter) (Lab)]

I am delighted that we are moving forward on capping ground rents and abolishing the feudal leasehold system. I have been supporting hundreds of residents across Exeter in fighting terrible practices by management companies, and I know that these measures will put money back into people’s pockets. Does the Minister agree that the age of the exploitative leasehold system—and the ripping off of residents—is finally over, and that it is thanks to a Labour Government?

[Matthew Pennycook]

My hon. Friend is absolutely right. We are calling time on the abusive practices of unscrupulous property agents and on the leasehold system as a whole. That is down to a Labour Government finishing the job that the previous Government were unable to complete.

[Several hon. Members rose—]

[Olivia Blake (Sheffield Hallam) (Lab)]

I thank the Minister for his statement; the measures will radically improve the system. He will be aware that over 170,000 houses in my constituency have had their freeholds purchased by Andrew Milne, who is now demanding that residents pay sums sometimes exceeding £25,000 to buy out the freeholds, and is threatening forfeiture and High Court action if they do not pay up. I welcome the Minister’s commitment to ending forfeiture, but will he set out what additional steps that Government are taking to regulate rogue freeholders?

[Matthew Pennycook]

I will be careful in what I say in respect of that particular case, but a meeting with my hon. Friend and other Sheffield MPs was postponed because this legislation was being brought forward. I will ensure that that meeting goes back in the diary as soon as possible.

[Danny Beales (Uxbridge and South Ruislip) (Lab)]

Today’s news is welcome for leaseholders in my constituency, whose ground rents—often of £400 or £500—escalate throughout their leases. The measures will save them thousands of pounds throughout their leases. In my time as an MP, I have been shocked by the behaviour of managing agents. There is strong support in this place and the other place for Lord Best’s recommendation for a proper regulator of managing agents. Will the Minister outline what steps will be taken, and what the timeline is, for action on managing agents?

[Matthew Pennycook]

We are clear that we need to strengthen the regulation of managing agents. I appreciate the strength of feeling, across the House, on the matter. As I have made clear, we will continue to reflect on the various recommendations made in Lord Best’s 2019 report, and I am more than happy to engage with my hon. Friend on his private Member’s Bill, which I know deals with some of these matters.

[Sarah Russell (Congleton) (Lab)]

I thank the Minister for his statement, which demonstrates how Labour stands up for people against vested interests—my constituents will thank him for it. On the ongoing problems with unadopted estates, which I have been raising with him since before my election, I would be extremely grateful if he agreed to visit my constituency to see the difficulties that homeowners face.

[Matthew Pennycook]

I think that I have already committed to ensuring that a visit to her constituency is on the very long list of requests that I have received, but I will bear her request in mind.

[Sam Carling (North West Cambridgeshire) (Lab)]

I commend the Minister for bringing forward these brilliant measures to protect leaseholders. Constituents across Hampton own the freehold to their homes but pay several levels of service charge—first, to managing agents such as FirstPort, which is supposed to be responsible for unadopted roads, and secondly, to Hampton Estates, which covers lots of the public open space, parks and drainage. As part of our reforms, how will the Government ensure that multi-level service charges like those are addressed, particularly in areas for which they were never supposed to be adopted?

[Matthew Pennycook]

Again, I refer my hon. Friend to the two comprehensive consultations that we launched before Christmas. We need to establish the new regulatory framework to provide consumer protections for residential freeholders on freehold estates. We are also consulting on how to reduce the prevalence of such private management arrangements, which are at the core of so many of the unjust practices that residential freeholders face.

[Jessica Toale (Bournemouth West) (Lab)]

I have heard too many horror stories from leaseholders in Bournemouth West. One constituent, Jeremy Green, described feeling like a second-class citizen subject to the total autocratic control of his freeholder landlord and its managing agent. Will the Minister assure me that this Labour Government are getting on with reform and giving leaseholders the protections and dignity that they deserve?

[Matthew Pennycook]

Given their experience of the leasehold system, it is completely understandable that Jeremy and other leaseholders across the country feel that the dream of home ownership has fallen so short. That is why we have to end the system in its entirety. This draft Bill goes a long way towards ensuring that we do just that.

[Peter Lamb (Crawley) (Lab)]

This package of measures will transform the lives of thousands of my constituents. On fleecehold, residents in Forge Wood are paying thousands of pounds for services that other constituents receive for free. Can the Minister confirm that he will act as quickly as possible following the end of the consultation?

[Matthew Pennycook]

We want to act as quickly as possible, particularly to bring in the new consumer protections provided for by the 2024 Act.

[Sarah Hall (Warrington South) (Lab/Co-op)]

I welcome the statement and the progress that it represents, and I put on record my thanks to the National Leasehold Campaign, which has spent many years campaigning tirelessly on behalf of existing leaseholders, who have been trapped in an unfair and archaic system. For the benefit of Warrington South leaseholders who are trying to understand the 40-year peppercorn cap, will the Minister explain how the 40-year cap was arrived at and whether there is any scope for the transition to be brought forward so that relief is felt sooner?

[Matthew Pennycook]

I echo my hon. Friend’s remarks about the NLC. I also thank others, such as the Leasehold Knowledge Partnership, Sir Peter Bottomley, who has now left this place, and other champions, including my hon. Friend the Member for Ellesmere Port and Bromborough (Justin Madders), who has stood up for leaseholders so vocally over many years. The rationale for the ground rent approach that we have chosen is set out in a policy paper that we published this morning. The Select Committee will be able to scrutinise the draft Bill and provide suggestions—that is the whole point of the pre-legislative scrutiny process.

[Jim Dickson (Dartford) (Lab)]

I welcome the statement and the Minister’s great work. Leaseholders and freeholders across my constituency, in places like Greenhithe, Ebbsfleet and Stone, will hugely welcome the cap on ground rents and the rest of the detail on the draft Bill. May I impress on the Minister the need for us to go further on supporting those who live on unadopted or freehold estates, and to address poor practices by managing agents?

[Matthew Pennycook]

I am acutely aware of the strength of feeling on freehold estates. It cannot be an either/or when it comes to ensuring that residential freeholders and leaseholders get the rights and protections that they need. I can assure my hon. Friend that we are taking concerted action on both fronts.

[Alistair Strathern (Hitchin) (Lab)]

This is an historic day for leaseholders, many of whom were let down by a lack of action from the previous Government, which left them on the hook for exploitative levels of ground rent. One 90-year-old constituent of mine was hit with a 9,000% increase in his ground rent—that cannot be right. I am really glad that the Minister has shown such leadership to ensure that we put that right today. I know he agree that we need to go further on unadopted estates, too, so will he meet me to ensure that we bring those protections forward as swiftly and effectively as possible?

[Matthew Pennycook]

My hon. Friend has been an incredible champion for residential freeholders and leaseholders in his constituency. It is precisely because of ground rent increases of that scale that we are imposing, via this draft Bill, a maximum cash cap. I am more than happy to meet him to discuss the draft Bill and related matters.

[James Asser (West Ham and Beckton) (Lab)]

I declare that I am a leaseholder. Correspondence from leaseholders in my constituency, which makes up a lot of my inbox, mentions poor service, rising charges and homes that they can no longer remortgage or sell, causing financial difficulty. They will very much welcome today’s announcement, but will the Minister reassure them that the Government will rise to all the challenges that they face, swing the balance of power back towards homeowners, and tackle the real problem of service charges, through which leaseholders are being fleeced for poor-quality services that are often not even delivered?

[Matthew Pennycook]

I absolutely agree with my hon. Friend. His constituency is just over the river from mine, and is, in many ways, very similar. Day in, day out he will receive, as I do, complaints about service charge increases and onerous ground rent terms. That is precisely why we are taking action, in this Bill and elsewhere, to provide the kind of relief that he seeks for leaseholders. As I said, over the course of this Parliament we will end the system for good.

[Mr Connor Rand (Altrincham and Sale West) (Lab)]

Since my election I have worked to support leaseholders across my constituency, meeting residents at Maple Court, Budenberg and St James Court. When I surveyed local leaseholders on what they needed from the Government, the most common response was a reduction of the unfair charges that they face. Does today’s announcement not show that we finally have a Government who are listening to leaseholders and putting money back in their pockets?

[Matthew Pennycook]

That is absolutely right. In this area and so many others, the cost of living and addressing the affordability crisis faced by so many families across the country is the Government’s driving mission. For leaseholders, the reforms in the draft Bill will be transformative, particularly on ground rents, and will also introduce other protections.

[Jack Abbott (Ipswich) (Lab/Co-op)]

I thank the Minister for his genuinely groundbreaking statement. It feels like a little while ago that he visited Ipswich to talk to local people about the building safety crisis and leasehold. He was a shadow Minister and I was a parliamentary candidate at the time. Now we are capping ground rents, making it easier to move to commonhold, and scrapping leasehold for all new builds. Is this a case of a Labour Government keeping their promises and making a real change for many people up and down the country?

[Matthew Pennycook]

That is absolutely right, and I can assure my hon. Friend that we have given consideration to building safety remediation in the design of this legislation. I should make it clear that freeholders’ obligations to ensure that their buildings are safe are not related, for example, to the right to collect ground rents. Many buildings already operate a peppercorn ground rent, and they are subject to the same legal obligations as other buildings. We do not want to see the impact that some in the country may be concerned about.

[Mr Jonathan Brash (Hartlepool) (Lab)]

My constituents in Hartlepool are facing outrageous estate management charges, including a 49% increase in the administration fee by management company Sela just this year on the Marine Point and Longbranch Homes estates, as well as ongoing charges by Praxis on the Wynyard Mews estate. We have heard that time and again from Members today. When will we switch on the protections of the 2024 Act, and give the powers necessary for homeowners to challenge unfair charges, hold estate management companies to account and prevent families from being unfairly burdened?

[Matthew Pennycook]

I simply say to my hon. Friend: as soon as possible. Through these new consumer protections, we are bringing into force a regulatory framework that takes some time to get right, but I want those protections in place as soon as possible, so that we can provide protection to his constituents and others across the country who are suffering from the set-up that he describes.

[Josh Newbury (Cannock Chase) (Lab)]

Yet again, we have the wonders of hindsight from the Conservative party. In the immortal words of Beverley Knight, “‘Shoulda woulda coulda’ means I’m out of time”, and the Tories certainly were. I thank my constituents, including Rob from Heath Hayes and Daniel and Rebecca from Brereton, who have written to me to stress the need for these reforms. Like them, I very much welcome the draft Bill. Given that these proposals will not only reform a feudal system but cap ground rents at £250, does the Minister agree that this is another way in which this Government are putting money back into the pockets of families struggling with the cost of living?

[Matthew Pennycook]

I do not want to be too critical of the Conservative Government, because they did bring forward the 2024 Act, and they did move the dial when it comes to the public conversation about things like ground rents. But ultimately, they did not finish the job, and it will fall to a Labour Government to do so.

New Towns

Matthew Pennycook Excerpts

Thursday 15th January 2026 Commons Chamber

[The Minister for Housing and Planning (Matthew Pennycook)]

It is a pleasure to close this debate for the Government. I congratulate my hon. Friend the Member for Cumbernauld and Kirkintilloch (Katrina Murray) and thank her for securing the debate, and I thank the Backbench Business Committee for granting the House an opportunity to debate this incredibly important matter. I was struck, in what was a strong opening speech by my hon. Friend, by her emphasis on people and the ability of “planning done properly” to change lives. That is a hugely important statement and a principle that guides the Government in all areas. I thank all hon. Members for contributing to the debate. We had a series of thoughtful, passionate and in many cases personal contributions, and I think the most references to concrete animals of any debate in my nearly 11 years in this place. It has been a thoughtful and important debate, rich with history.

The post-war new towns programme was the most ambitious town building effort ever undertaken in the UK. It transformed the lives of millions of working people by giving them affordable and well-designed homes in well-planned and beautiful surroundings. The 32 communities it created are now home to millions of people, including a number of hon. Members who made contributions this afternoon. I stress that the Government will continue to invest in the regeneration of our existing new towns. My hon. Friend made reference to some of the investment currently being made in hers. My hon. Friends the Members for Telford (Shaun Davies), for Rugby (John Slinger), for Welwyn Hatfield (Andrew Lewin) and for Stevenage (Kevin Bonavia) all made the case for what is happening, and what they want to see happen in the years ahead, to further revitalise the places they represent.

Alongside those efforts, we are determined to bring forward the next generation of new towns, as per our manifesto commitment. In so doing, we have taken inspiration from the proud legacy of the 1945 Labour Government who, through the New Towns Act 1946, initiated the first post-war wave of new town building, as well as the subsequent waves in the 1960s. But we have also sought to learn crucial lessons from those previous efforts, for example—this was a point made by several hon. Members—the fact that previous new town initiatives did not always embed long-term stewardship into their development and the detrimental consequences that has had for those locations.

As the House will know, to progress the next generation of new towns, the Government established an independent new towns taskforce within months of taking office. That taskforce, chaired by Sir Michael Lyons, with Dame Kate Barker as his deputy and eight other highly regarded expert members drawn from across the built environment sector—I pay huge tribute to all their work in producing their final report—was given a clear mandate: to make recommendations to Ministers on the location and delivery of new towns, with the objective of supporting and unlocking economic growth, as well as making a significant contribution to meeting housing demand in England.

The Government made it clear that the taskforce should consider not only large-scale stand-alone new communities of the type Tempsford might be, but urban extensions and urban regeneration schemes that would work with the grain of development in a given area. We specified that each of the new settlements should contain at least 10,000 homes, but made clear that we expected a number to be far larger in size. We also commissioned the taskforce to ensure that any proposals would deliver

“well-connected, well-designed, sustainable and attractive places where people want to live and have all the infrastructure, amenities and services necessary to sustain thriving communities.”

Let me be clear, and hon. Members are right to have raised this: success on those criteria will be integral to the success of the programme as a whole.

Last September, the Government published the final report of the taskforce, as well as their initial response to that report and immediate next steps. In that initial response, the Government warmly welcomed all 12 of the locations recommended by the taskforce on the basis that, prima facie, each has the clear potential to deliver on the Government’s objectives. We also made it clear that Tempsford, Crews Hill in Enfield and Leeds South Bank look particularly promising to us as sites that might make significant contributions to unlocking economic growth and accelerating housing delivery. We are determined to get spades in the ground on at least three new towns in this Parliament—I stress the words “at least three”, because three is not the limit of our ambition. I think the shadow Minister incorrectly assumed that it will be just the three locations we have cited as promising. We are determined to deliver at least three, but we are prepared to progress work on a far larger range of locations if that proves possible.

As the House will be aware, we are now in the process of conducting a strategic environmental assessment to better understand the environmental impacts of new town developments in the locations recommended by the taskforce, as well as refining the scope of the programme more generally. Again, I want to stress that no final decisions on locations will be made until the SEA concludes and that the prioritised locations could change as a result of that process.

To respond directly to the shadow Minister’s point, we intend to consult on the programme alongside the completed SEA report in the coming weeks. The feedback to that consultation will inform final decisions on the locations we intend to adopt, as well as other matters such as how we allocate funding between sites and how we define and support new town locations in planning policy. When we are at the point of making decisions, we will publish a comprehensive response to the taskforce’s final report.

Hon. Members have raised a number of specific points in today’s debate, which I will respond to as fully as I can within the constraints of the ongoing SEA and programme scoping process. The hon. Member for North Bedfordshire (Richard Fuller) and the Liberal Democrat spokesperson, the hon. Member for Taunton and Wellington (Gideon Amos), raised the matter of local housing need and how housing targets interact with our new towns programme. We have been clear that our starting assumption was that new towns should deliver over and above the targets produced by the standard method, not least because we expect construction of the new towns that move forward as a result of this programme to begin in earnest only towards the end of the Parliament. However, I have been reflecting on this matter—not least in response to representations made by hon. Members—and I want to ensure that when we come forward with our final position on LHN, it is fair and consistent across the country and provides the necessary incentives for communities to want to see new towns come forward.

The Chair of the Housing, Communities and Local Government Committee, my hon. Friend the Member for Vauxhall and Camberwell Green (Florence Eshalomi), and other hon. Members raised the issue of affordable housing. I assure the House that we are not walking back or watering down our commitments on affordable housing. We have been very clear that new towns should have a range of housing types available, including adequate proportions of genuinely affordable homes.

It is worth stressing that the taskforce endorsed the Government’s commitment on affordable homes in its final report—it was a Government gold standard to aim for a target of 40% affordable housing. The taskforce was very clear in its final report that it endorsed that target and that it wanted to see 40% as a minimum, with half of those being social rented homes. We desperately need social rented homes, which is why that is such a priority for the Government.

The taskforce clearly said that where viability makes achieving that 40% target challenging, the Government should look to meet the requirement through grant funding, which is something the Government have to consider as we scope the programme, in particular in locations with low land values, where meeting that affordable number will be more challenging. Again, we will bring forward further detail on that and the other place-making principles in the taskforce’s final report after the environmental assessment and consultation, when we can provide hon. Members and the public more widely with more detail.

My hon. Friend the Member for Vauxhall and Camberwell Green also referred to delivery models. The Government agree with the taskforce that the preferred model for new towns should be the development corporation model. I think the House well understands the benefits that come with that. There are, of course, a range of development corporation types, including centrally led, mayoral and even locally led development corporations —it all depends on the location of the town, its devolution settlement and the capacity and capability of the delivering authorities. Again, we are assessing which delivery vehicle options are most appropriate to individual locations and will come forward with further information on that point in due course.

Several hon. Members raised the issue of funding, challenging me to make it clear why there has not been more detail on funding and why there is not a dedicated pot of funding for new towns. It is because the funding required for new towns in this spending review period will vary according to the needs of the places that the taskforce has recommended and that we ultimately adopt through the scoping process.

I want to make it clear to hon. Members, however, that the delivery of new towns will be backed by funding across the Government’s landmark housing programmes, such as the £39 billion social and affordable housing programme and the hundreds of millions of pounds of grants that are available through our national housing delivery fund for land and infrastructure investment; there is also the additional capital funding that will be managed by the new national housing bank, which will invest in house building across the country. Even though there was no specific new towns fund announced in the Budget, there are funding sources to draw upon.

[Gideon Amos]

The Minister is always very generous with his time. Can I press him a bit further on whether the Treasury has ruled out the long-term loans that were there for the post-war new towns programme?

[Matthew Pennycook]

I will come on to talk about financing in more detail, in particular the options that we are considering, but I am afraid that the hon. Gentleman will, again, have to wait for the publication of the SEA report and the programme that will go out to consultation. He and other hon. Members, as well as their communities and the neighbouring communities to the sites proposed for adoption, will then be able to feed into that process more widely. Long-term funding is available in this spending review period and going forward, because many of these propositions are for new, large-scale communities that will have to be built out over decades, in some cases.

I will touch on two or three other issues. Most importantly, several hon. Members raised the theme of public engagement. What the taskforce heard through its call for evidence and engagement with local leaders and local areas—the Government were kept up to date with that, as Sir Michael Lyons reported to me regularly on the taskforce’s work, as the House would expect—was that there is a huge appetite for new new towns to come forward. There are lots of parts of the country that would desperately welcome a new town.

I recognise, however, that in other areas, particularly in small villages such as Tempsford, there is trepidation about what may come and there are questions that residents want answered. In some cases—my hon. Friend the Member for Macclesfield (Tim Roca) has been forthright and honest about this—there is outright hostility and objection to the proposed locations. We have met and had several conversations about his particular case, and I assure him that I recognise the strength of feeling in his community. His residents can be in no doubt that he has conveyed the strength of feeling about that location very forcefully to me.

The taskforce’s report is clear that existing communities should be a key part of any new town development; community engagement is one of its core recommended place-making principles. The Government are working closely with local leaders as part of the scoping process of the programme and building our evidence base to understand the impacts of potential new town locations. As I have said, we will carry out the appropriate assessments and public consultations before any final decisions are made about locations. I must stress—we have been candid about this fact from the outset—that ultimately, decisions on new town locations will be made in the national interest.

[Chris Curtis]

I thank the Minister for being generous with his time and for reinforcing the Government’s strategic direction, which I think most of us agree with. As we move on to the next stage, many of the local council leaders who he has spoken about feel like there is friction and frustration in the communication between them and the Department, with the Department making it feel like they are bidding for the money. Will he meet local council leaders to reset that relationship so that it can be more constructive in the next stage of the process?

[Matthew Pennycook]

My hon. Friend made the same points when I appeared before the Select Committee earlier this week. I have taken them on board and I am happy to look at what the Department can do to ensure that there is a constructive relationship in each instance where the Government are seeking to build the evidence base. I certainly do not recognise, however, that it is the Government’s intention to go out to local areas and ask them to bid in to the programme. We want to work with local communities and local leaders to better understand and assess the proposition in each case.

I want to address two further issues. First, on financing, all the lessons suggest that once development is under way on new town sites, the long-term increase in the value of land can be captured and reinvested. Several hon. Members made that point forcefully, and the hon. Member for Taunton and Wellington is correct that the three waves of new towns programmes each repaid the investment that was ploughed into them up front. We know that, and the taskforce recommended that we should explore a range of options, including taxation, in the financing model—for example, we are exploring the role that tax increment financing might play in the new towns programme, as was mentioned by the Select Committee Chair.

Lastly, I want to address the important theme of stewardship, which several hon. Members raised. We welcome all the taskforce’s recommendations on place-making and other issues that will be pertinent in the years ahead as we take the programme forward. On stewardship, the taskforce recommended, rightly in my view, that a long-term stewardship model should be in place from the outset and that it should include clear governance and funding structures to manage and maintain communal assets. In that way, we can learn the lessons from the earlier waves of new towns and get things right for this new programme.

To conclude, the Government’s new town programme, in the Government’s view, provides a once-in-a-generation opportunity to fundamentally reshape the delivery of large-scale new communities and, by delivering them, to boost economic growth and productivity, and make a significant contribution to meeting housing need in England over the coming decades. The Government remain resolute in their determination to bring forward the next generation of new towns. We will work tirelessly across Government and with delivery partners and local communities to ensure that they are, in the words of the taskforce, not just places to live, but places to live well, and places for people.

I am grateful to my hon. Friend the Member for Cumbernauld and Kirkintilloch for securing and opening the debate, and to other hon. Members for taking part. I know that hon. Members will take me at my word when I say that I look forward to further engagement with Members across the House as we advance the programme in the months and years ahead.

Chinese Embassy

Matthew Pennycook Excerpts

Tuesday 13th January 2026 Commons Chamber

[Alicia Kearns (Rutland and Stamford) (Con)]

(Urgent Question): To ask the Secretary of State for Housing, Communities and Local Government if he will make a statement on the release of unredacted plans for the proposed Chinese embassy.

[The Minister for Housing and Planning (Matthew Pennycook)]

This question relates to the proposals for a new Chinese embassy at Royal Mint Court. It is a decision to be taken by Planning Ministers, independent of the rest of Government. As I have said before in the House, this Government are committed to the probity of the planning process at all levels, to ensure robust and evidence-based decision making. Planning Ministers must take decisions following a quasi-judicial process, meaning that they must take decisions fairly, based on evidence and planning rules.

As the case is currently before the Department for consideration, and due to the statutory role of Ministers in the planning process, it would be entirely inappropriate for me to comment further on this live case. That said, I fully understand Members’ interest in the case, so I will briefly set out the process that the case has followed to date. A public inquiry into the applications was held by an independent planning inspector between 11 and 19 February 2025. The Department received the inspector’s report into the applications on 10 June that year. On 6 August 2025, a reference-back letter was sent to parties seeking further information, specifically in respect of the redacted plans and some issues raised by the Home Office and the Foreign, Commonwealth and Development Office. That was recirculated for further comment on 22 August, and again on 16 October, 2 December, and 17 December. It was recirculated for information on 6 January 2026. Referring back to parties is routine when further information is required.

As you know, Mr Speaker, the Government do not provide a running commentary on planning casework decisions, and it would be particularly inappropriate to make any comment on material that has been received. The reference-back material will be available on request when the decision is issued. The timetable has been varied to allow for full consideration of the applications, given the detailed nature of the representations provided, and the need to give parties sufficient opportunity to respond. A final decision will now be made on or before 20 January 2026. Such variation to the timetable is routine when additional time is needed for determination. Members can be assured—I am afraid I will be required to state the following ad nauseam, Mr Speaker—that Ministers will take all material planning considerations into account when the final decision is made, and Ministers will inform the House of the decision accordingly.

[Mr Speaker]

In fairness, you brought me into this by saying that I would know about planning—absolutely—but I did not choose for you to be the Minister who answered this. I would have thought it would have been someone from the Home Office, and the Minister for Security. I call Alicia Kearns.

[Alicia Kearns]

Thank you, Mr Speaker. It is very disappointing to get a technocratic history lesson rather than an answer to the meaningful question.

Two hundred and eight secret rooms and a hidden chamber, just 1 metre from cables serving the City of London and the British people—that is what the unredacted plans tell us the Chinese Communist party has planned for its new embassy if the Government give it the go-ahead. Indeed, we now know that it plans to demolish the wall between the cables and the embassy—cables on which our economy is dependent; cables carrying millions of British people’s emails and financial data, and access that would give the Chinese Communist party a launchpad for economic warfare against our nation.

The Home Office and the Foreign Office say that security concerns have been “addressed”, so I put this to the Minister: had any Minister seen the unredacted plans before The Telegraph uncovered them? If not, why not? Was Parliament misled when we were told that all documents were publicly available? Is it true that in December a briefing was given to our Five Eyes partners on these risks? Does the Minister really have no concerns at all over plans to install heavy ventilation equipment parallel to those cables? What is that for? If the Government are as shocked as we are today, have Ministers already called in the Chinese ambassador to explain those secret rooms? If not, why not? The embassy would create a daily headache for our security services. What confidence can we have that the CCP’s technological capabilities can be contained for a decade, let alone 10? I have consistently asked the Government to require the Chinese to pay for any re-routing of cables if they are to give this go-ahead, so will the Government commit to that today?

We understand that the Prime Minister is planning to visit Beijing this month. Is it true that the embassy will be approved this week? That the Prime Minister plans to reward the Communist party, which is holding a British national hostage and torturing him in confinement, and which put spies at the heart of our democracy, is bad enough, but to turn up with a gift in hand, begging for handouts, beggars belief. Labour promised a new relationship with China, yet UK goods exports are down 23%. Surrendering our security for Chinese trade was always a bad policy, but surrendering our security while exports plummet is, frankly, insanity. The Government can claim today they had no idea about the secret rooms, and we will take them at their word, but they cannot now say that they have no power to protect us. We must protect our economy, protect the British people, and deny the Chinese Communist party its embassy.

[Matthew Pennycook]

I thank the shadow Minister for her questions. I am obviously not going to comment on speculation in the press. On the specific case before Ministers, at the application stage it was a matter for parties what information was put forward for consideration, and it was a matter for Tower Hamlets what information was put on the planning register and the inquiry website. We have not misled the House. All inquiry documents are publicly available on that website, and if new potentially relevant information is drawn to the Department’s attention, it will be assessed. That includes consideration of its relevance, and whether it is necessary to obtain that information or refer back to parties. That is a routine process.

The Secretary of State transparently sought further information on the redacted drawings via a reference-back letter to parties issued on 6 August. I say again that no decision has been made on the case. I cannot comment on individual aspects of the case, and it would be entirely inappropriate for me to comment on any matter of national security, or on behalf of the security services. All inquiry documents, including the redacted drawings put forward by the applicant at application stage, are publicly available on the Tower Hamlets website. When the final decision is published, the decision letter will contain a list of post-inquiry representations, including those received as part of the reference-back exercise, and those will be publicly available on request.

[Sarah Champion (Rotherham) (Lab)]

Multiple Government agencies and Departments have raised concerns about this mega-embassy. Our international partners have raised concerns about it, and every security briefing I have identifies China as a hostile state to the UK. I am in no doubt that this mega-embassy should not be allowed to go ahead. Internationally, China is terrorising the people of Hong Kong. It is terrorising democratic people in Taiwan, and it is terrorising some people already in the UK. I look to my local university of Sheffield Hallam, and also to what China is doing to parliamentarians right here. I want my Government to stand up to bullies, not to reward them. We need to put in place rules and limits around China to stop this behaviour, not reward it with the embassy that it so dearly wants.

[Matthew Pennycook]

I thank my hon. Friend for her questions, and I note and appreciate her concerns. We need a consistent position on China, which cannot be boiled down to one word. We recognise that China poses a series of threats to UK national security, and we challenge those robustly. China also presents opportunities to the UK, as the world’s second largest economy and the UK’s third largest trading partner. We will therefore continue to develop a consistent and pragmatic approach to economic engagement, without compromising our national security. On Hong Kong in particular we will not tolerate any attempts by foreign Governments to coerce, intimidate, harass or harm their critics overseas, especially in the UK.

On the matter before us, which is the particular case in question, as I have stressed before—I am afraid I will have to do so repeatedly—no decision has been made. I cannot comment on any aspects of the case, which is a live case for Planning Ministers to determine. All material considerations will be taken into account when making a decision, but I am afraid I cannot comment on any specific national security concerns.

[Mr Speaker]

I call the Liberal Democrat spokesperson.

[Calum Miller (Bicester and Woodstock) (LD)]

The redacted plans for the Chinese super-embassy provide new reasons to reject this application. Will the Minister confirm whether the Government had access before today to the unredacted plans showing the proximity of basements to critical communications cabling? Will he, and other Ministers, ensure that the intelligence agencies update their risk assessments before a final decision is taken?

On 16 December, the Government told the House that an urgent review would be launched into foreign financial interference in UK politics, including by China. Will the Minister now agree to pause any decision on the super-embassy until the Rycroft review has reported? The new super-embassy would also condemn Hongkongers living in Britain to more surveillance, more intimidation, and more bounty hunting. On Saturday, hundreds of Hongkongers are expected to join a protest outside the proposed super-embassy site. Will the Minister, or a colleague, meet the protesters on Saturday outside the embassy, to listen to their concerns first hand?

[Matthew Pennycook]

I want to be very clear about what information the Department had and when it had it. As I said, an independent inquiry into this matter was held by an independent planning inspector. The onus is on the applicant to submit documents to that inquiry. At the point that the inspector’s report was given to us, it was then in the gift of the Department to request further information via a reference back to parties. We did that on 6 August, specifically in respect of those redacted plans. I am not going to comment on live applications to the case, but all material considerations will be taken into account. Similarly, it would not be right for me to comment on the intelligence services or what input they have had into the decision, but the Minister for Security, my hon. Friend the Member for Barnsley North (Dan Jarvis), is beside me on the Front Bench. A decision will be made on or before 20 January. At that point, the decision letter will be issued. It will contain a list of post-inquiry representations, including those received as part of the reference-back exercise, and it will be publicly available on request.

[Uma Kumaran (Stratford and Bow) (Lab)]

China has used its national security law to criminalise political dissent and target Hongkongers in the UK. My constituency of Stratford and Bow is home to one of the largest Hongkonger populations in our country, and they tell me how scared they are of the proposed Chinese mega-embassy in our neighbouring east London constituency. What assurances can the Minister offer that this Government—the British Government—will stand up for the people of Hong Kong, and that this proposed embassy will not enable and embolden further coercion and intimidation of Hongkongers in the UK, particularly those in London?

[Matthew Pennycook]

I repeat what I said specifically about transnational repression. We will not tolerate any attempts by foreign Governments to coerce, intimidate, harass or harm their critics overseas, especially in the UK. The decision that is before Planning Ministers will be taken independent of the rest of Government. Planning Ministers must take decisions following a quasi-judicial process, meaning that they must make decisions fairly, based on evidence and planning laws. I stress again that all material considerations will be taken into account when reaching a decision.

[Mr Speaker]

I call the Father of the House.

[Sir Edward Leigh (Gainsborough) (Con)]

This is the national Parliament and it deserves answers. I have already asked this question to the Minister for Security, the hon. Member for Barnsley North (Dan Jarvis), and I got no answer at all. It may seem to be a subsidiary point, but it is important. On 14 January 2025, the Secretary of State wrote to the Chinese demanding an answer about whether there will be a perimeter wall so that the public can access the buried Cistercian monastery. With typical arrogance, the Chinese have not even replied. Why is that important? Because if Ministers insisted on what they wrote about last January, there would have to be an entirely new planning permission. The site is near the Tower of London, where so many prisoners of conscience died over the centuries, so—who knows?—maybe the prayers of medieval monks might finally stop this aberration.

[Matthew Pennycook]

I am afraid that all I can say to the right hon. Gentleman, for whom I have a huge amount of respect, is that all material considerations will be taken into account when reaching a decision on this case.

[Alex Sobel (Leeds Central and Headingley) (Lab/Co-op)]

The Joint Committee on Human Rights undertook an inquiry on transnational repression last year. It found that the Chinese state undertakes considerable transnational repression against the Chinese diaspora in the United Kingdom, much of it co-ordinated out of the existing Chinese embassy. The new super-embassy is a real threat to Hongkongers, Uyghurs and other members of the Chinese diaspora who do not toe the Beijing party line. Will the Minister reassure me that transnational repression of the Chinese diaspora is a material consideration when making this planning decision?

[Matthew Pennycook]

The Foreign Secretary has been robust on human rights, including those in Xinjiang. She has raised our concerns about the implementation of the national security law in Hong Kong and called for the immediate release of Jimmy Lai. When it comes to human rights, we are forthright with the Chinese Government. I am not going to comment on a live case that is in front of Planning Ministers as to what specific material considerations will be taken into account, but I can assure my hon. Friend that they all will be.

[Sir Julian Lewis (New Forest East) (Con)]

Has the Intelligence and Security Committee had an opportunity to question the National Security Adviser—not the deputy—about this matter? If the Minister says that he does not know, then he is the wrong Minister to be answering this urgent question. If he says that he does know, but he cannot say because that information is highly classified, let me assure him that the identities of witnesses interviewed at that level by the Intelligence and Security Committee are not private, but published whenever the Committee is minded to do so. Will he answer the question in a straightforward way: was the ISC given the opportunity to question the National Security Adviser?

[Matthew Pennycook]

It is for the ISC, not me, to comment on its proceedings. I can tell the right hon. Gentleman that national security is the first duty of Government. It is not appropriate for me in this instance to comment on any specific matters of national security, but as I continue to repeat, all relevant planning considerations will be taken into account when making a decision on this case.

[Rushanara Ali (Bethnal Green and Stepney) (Lab)]

My hon. Friend will be aware that I have written to the Secretary of State to highlight the concerns of my constituents about the proposed embassy in my constituency. While I recognise the planning dimension and the limits on what he can say, will he none the less reassure me and the House that residents’ concerns about security and human rights, as well as wider local concerns, will be taken seriously as part of the process, not least because the area has one of the largest Muslim populations in the country? We are all aware of the persecution of Uyghur Muslims, which this House has campaigned against, among wider human rights violations.

[Matthew Pennycook]

As I have said, all material considerations will be taken into account when making the decision. Any party can make representations on the case and a number of hon. Members from across the House have done so, and all relevant planning considerations will be taken into account when reaching that decision.

[Bobby Dean (Carshalton and Wallington) (LD)]

I am exasperated by the Government’s response to this urgent question. They are treating this development as a mere wrinkle in a bureaucratic planning matter, which is simply not the case. If this embassy is granted, it will be one of the largest and most prestigious embassies held by any country in Europe, and that has huge diplomatic consequences. Will the Minister reassure us that it is not merely planning considerations that are being taken account, but those of national security and diplomatic importance as well?

[Matthew Pennycook]

All material considerations will be taken into account, which include matters of national security, but the decision is being taken by my Department, in line with statutory provisions governing planning decisions and published propriety guidance. As I have said, the full reasons for the decision will be set out in the published decision letter, but as I continue to explain, no decision has yet been made.

[Lillian Jones (Kilmarnock and Loudoun) (Lab)]

I appreciate the limitations on what the Minister can and cannot say, but in the light of the publication of unredacted plans for the Chinese embassy, will the Government and the security services look again at whether it would be appropriate to allow the embassy to proceed?

[Matthew Pennycook]

I am not going to comment on behalf of the security services—[Interruption.] Opposition Members are chuntering from a sedentary position, but I am not going to do that. It is not appropriate for me to comment on behalf of the security services, but as I continue to say, all material considerations will be taken into account. I am here answering the urgent question on the Chinese embassy, which is a decision for my Department and Planning Ministers within it.

[Sir Julian Smith (Skipton and Ripon) (Con)]

The Minister talks about this being a planning decision, but essentially it is a political judgment. Many right hon. and hon. Members want to make strong representations to the Government and the National Security Adviser about the judgment call on getting a closer relationship with China and this embassy. The site of the proposed embassy is massive—I went around it over the past couple of days—and Mansell Street is really restricted, meaning it will be completely impossible to monitor what is going on there, so that judgment is wrong.

--- Later in debate ---

[Matthew Pennycook]

I note the right hon. Gentleman’s concerns, and the Security Minister and other Ministers will have heard them too. However, the case is specifically a planning decision to be made in accordance with the propriety rules and other considerations that Planning Ministers have to take into account as part of the quasi-judicial process, but all material considerations will be taken into account as part of that process.

[Mark Sewards (Leeds South West and Morley) (Lab)]

My constituent, Chloe Cheung, has to live with the fact that she has a £100,000 bounty placed on her head under the national security law in Hong Kong. She walks around every day knowing that anyone here could claim that bounty by taking her to the Chinese embassy and handing her over to the authorities. Now she is worried that she might find herself locked away in one of the secret rooms shown in the new embassy plans. What exactly are the Government going to do to ensure that Chloe is protected and kept safe, and that that never happens to her or anyone else with a £100,000 bounty on their head, if the new embassy is approved?

[Matthew Pennycook]

I recognise my hon. Friend’s frustration and anger on behalf of his constituent. We will not tolerate transnational repression of the kind that he is concerned about. Specifically, the counterfactual here is not that the Chinese do not have an embassy; they have seven diplomatic premises in the UK already. Again, I come back to the fact that we will make a decision on this case on the material planning considerations that pertain to it.

[Chris Law (Dundee Central) (SNP)]

Every single day, people from the Tibetan, Hong Kong, Uyghur and Falun Gong communities here in the UK already face intimidation through transnational repression. Their activities are under constant surveillance, and their families living under Chinese rule face arrest and prosecution. There are $1 million bounties placed on them, and their neighbours in the UK are encouraged to pass on information or deliver them to the Chinese authorities. Given the increased threat to their safety that the mega-embassy poses, what action are the Government taking to counter those actions? What message do the Government have for those communities?

[Matthew Pennycook]

We have reviewed transnational repression through the defending democracy taskforce; we take it incredibly seriously, and I note the hon. Gentleman’s concerns. I am here on behalf of my Department as the Housing and Planning Minister to make clear what the process is for making a decision on this embassy application.

[James Naish (Rushcliffe) (Lab)]

This debate on the mega-embassy is not just about a building and 208 secret rooms; it is primarily about national security and the safety of those from the Hongkonger, Chinese, Uyghur and Tibetan diasporas in the UK—approximately 700,000 people. We have learned that in 2018, the then Prime Minister committed to no delays in granting permission for the mega-embassy, which has an air of predetermination. What reassurances can the Minister give me and this House that that opinion has not compromised the independence of the planning process?

--- Later in debate ---

[Matthew Pennycook]

The planning process has not been compromised. We will make a planning decision on the basis of the relevant propriety guidance. On the delays, given the detailed nature of the representations provided and the need to give parties sufficient opportunity to respond, we have considered that more time is needed for full consideration of the applications. A variation to the timetable is routine when more time is needed for determination, such as when it is necessary to consider that additional information, but as I have made clear, our intention is to make a decision on or before 20 January.

[Sir Desmond Swayne (New Forest West) (Con)]

The sentencing hearings of Jimmy Lai, a British subject, are taking place. China has abrogated every agreement that it made with us over Hong Kong. What outrage would China have to commit for us to deny any demand that it made? The Minister says that he could not distil our relationship with China down to one word, but oh yes we can. It is a very big word; it is no.

[Matthew Pennycook]

The UK condemns the politically motivated prosecution of Jimmy Lai. No state can bully and persecute the British people for exercising their basic rights. Following the court verdict, the Foreign Office summoned the Chinese ambassador to underline our position in the strongest terms, and we call again for Jimmy Lai’s immediate release.

[Christine Jardine (Edinburgh West) (LD)]

The Minister is very artfully avoiding answering the question that my constituents and Hongkongers, Chinese, Muslims and Tibetans all over this country want to know the answer to, and it is not about the planning process. They are concerned about their safety and security, and they are concerned that the redacted photographs show just how close a foreign country is to critical communications cables. That is their concern; they want to know that they are safe and that this Government are taking that into account. That is the question we want to ask, so please do not tell me about the planning process.

[Matthew Pennycook]

With all due respect to the hon. Lady, this is an urgent question in relation to plans that are part of a planning process. I understand her frustration, but it was precisely to secure the information in question that a reference back was made to the parties on 6 August. Her constituents can be reassured that all material considerations will be taken into account by the relevant Ministers when a decision is made on this case.

[Dr Andrew Murrison (South West Wiltshire) (Con)]

I am sure that Tower Hamlets building control is very good, but it is not a security expert. If this plan goes ahead—I very much hope that it does not—will the Minister at least assure the House that the agencies will be fully involved in monitoring the demolition of the wall along Mansell Street and around the Wapping exchange? Will the replacement be monitored closely to ensure that our critical national infrastructure is safeguarded?

[Matthew Pennycook]

I note the right hon. Gentleman’s question. For obvious reasons, we do not comment on intelligence matters. I can assure him that national security concerns and all the representations that have been made along those lines will be taken into account as part of the decision-making process. He says that Tower Hamlets does not have the relevant expertise to make the decision in the round; that is precisely why an independent public inquiry was held by an independent public inspector. The report was passed to the Government, and they had the chance to seek further information for a reference back, as we did on 6 August, so that the relevant Planning Minister in my Department can take the decision on the basis of all the required information.

[Mr Paul Kohler (Wimbledon) (LD)]

The Minister has asked for a question about planning, so I will give him one. I am struggling to think of an innocent reason why important details would be redacted from the original application. Can he tell me what explanation has been given for those redactions?

[Matthew Pennycook]

As I have said, it was precisely because the Department did not feel that it had all the necessary information to make a decision that we sought that further information via a reference-back letter to parties. As I continue to say, all material considerations will be taken into account when a decision is made.

[David Reed (Exmouth and Exeter East) (Con)]

Making the same mistake repeatedly is a form of stupidity. As a country, we keep doing the same thing. If we cast our minds back to the debacle with Huawei, we will remember that we let the Chinese Communist party essentially into our 5G network. We did not listen to our national security advice, but we stopped and pulled back, and we have done the exact same thing with civil nuclear. The Minister has responsibility for this matter; he can step in and pull the plug. At what point will Ministers wake up and realise that we are making the same mistake again?

[Matthew Pennycook]

Planning Ministers will make a decision taking into account all material planning considerations.

[Carla Lockhart (Upper Bann) (DUP)]

The proposed Chinese embassy includes a subterranean facility just centimetres from cables carrying highly sensitive financial data. Any hostile intelligence service designing an espionage target would struggle to find a better location. Northern Ireland has learned that strategic assets must not be put at unnecessary risk for the sake of diplomatic symbolism. National security cannot be an afterthought. At a time when this House voices concerns about foreign influence online, we must also confront the real-world threat of hostile states exploiting our critical infrastructure. Will the Minister do the right thing and agree that national security should trump planning? Will he therefore say no to this proposal?

[Matthew Pennycook]

I simply cannot provide a running commentary on a live case, but I assure all hon. Members that national security is the first duty of Government generally and that all relevant planning considerations will be taken into account when making a decision.

[Sarah Bool (South Northamptonshire) (Con)]

The Minister has recognised that China poses significant threats, yet this Government are prepared to welcome this Trojan horse of an embassy into the heart of our city, so close to the Link system. He talks about material planning considerations, but that means balancing developing needs with community impact and ensuring that development aligns with local and national policies and site-specific details such as heritage, which was mentioned by the Father of the House, my right hon. Friend the Member for Gainsborough (Sir Edward Leigh). Not one contributor in this House can say that this embassy is not a threat to national security and that it is in any way a good and solid planning application. How can this Government be so naive as to accept it?

[Matthew Pennycook]

No decision has been made on this case.

[Luke Taylor (Sutton and Cheam) (LD)]

I thank the hon. Member for Rutland and Stamford (Alicia Kearns) for submitting her application, and Mr Speaker for granting another urgent question on this issue. Although we are not yet happy with the answers, we have at least been given repeated chances to scrutinise the issue as it has progressed.

I am here on behalf of Hongkongers in Sutton and Cheam and across London who are aghast at the prospect of this project being given permission. We have seen the persecution and conviction of Jimmy Lai; transnational repression of Hongkongers in the UK through, among other things, the withholding of their mandatory provident fund savings that allow them to survive here; bounties placed on activists; and action taken against MPs, such as my hon. Friend the Member for Bath (Wera Hobhouse) being prevented from going into Hong Kong, and sanctions being placed on other MPs. If a hostile state is rewarded for all these actions with permission to expand and increase its capabilities for surveillance, espionage and repression in our capital city, what hope can any of us have that the Government will stand up against hostile states for Britain and Britons in an increasingly hostile and dangerous world?

[Matthew Pennycook]

I simply note that all the points the hon. Gentleman has made could apply to the existing seven diplomatic premises in the UK. When it comes to this site, as I have said, a decision will be made on or before 20 January, and all material considerations will be taken into account. We remain steadfast in our support for the Hong Kong community in the UK. As I said in answer to a previous question, we have undertaken a review of transnational repression as part of the defending democracy taskforce—it is something we take incredibly seriously.

[Dr Neil Shastri-Hurst (Solihull West and Shirley) (Con)]

For the thousands of British national overseas people in my constituency, the prospect of the Chinese super-embassy is deeply worrying, and that worry is compounded by these unredacted plans. With that in mind, can the Minister confirm whether any Government Minister has called in the Chinese ambassador to discuss these issues, and if they have not, why not?

[Matthew Pennycook]

I am afraid to say to the hon. Gentleman that I cannot provide a running commentary on a live case. All material considerations will be taken into account when making a decision.

[Bradley Thomas (Bromsgrove) (Con)]

This is a complete farce, to be quite honest. We have seen reports in the media that there will be a secret room less than 1 metre away from sensitive cabling, and that since 2018, the Chinese authorities have been cutting off utilities to the UK embassy in China. National security should surely trump the planning system. This is a decision that should be taken by the Prime Minister in Downing Street—it should be a very quick and resolute no. If the Government are not in a position to do that, the framework needs to be changed. If necessary, the Government need to come before Parliament to do that, where they will find a very warm reception.

[Matthew Pennycook]

I do not think I could have been any clearer: all national security considerations will be taken into account when making a decision on this case.

[Ian Roome (North Devon) (LD)]

I will offer the Government some advice. It is one word: common sense. [Interruption.] Well, two words. Given the interest in national security, I am quite surprised that a Planning Minister is at the Dispatch Box to talk about this case, but the two issues are intertwined. The Minister has rebutted other Members’ questions with “That is a security issue; it is not my portfolio”, but given what we know, will he review the proximity of other countries’ embassies to major underground fibre-optic cables? That is a big worry for the country’s intelligence services and for many constituents throughout the country.

[Matthew Pennycook]

I note the hon. Gentleman’s concerns, and I appreciate his frustration, but this is ultimately a planning case on which a decision is being made. As I have said repeatedly to hon. Members, all material considerations will be taken into account when reaching a decision on this case.

[Blake Stephenson (Mid Bedfordshire) (Con)]

London is a critical global financial centre; we all rely on it, as do all of our constituents. Does the Minister recognise the very serious risk that approving this Chinese super-embassy could, as my hon. Friend the shadow Minister said, pave the way for economic war—not just on our country, but on the western world, including by undermining the security of critical data travelling under the site to and from the City of London?

[Matthew Pennycook]

What I would say to the hon. Gentleman, as I have said to other hon. Members, is that all national security considerations will be taken into account. He can be reassured of that fact.

[Cameron Thomas (Tewkesbury) (LD)]

Whatever statements have been made publicly, the unredacted plans for this super-embassy will fill our security services with dread, as well they should. The Chinese Communist party is not a friend to the United Kingdom, and nowhere is that more evident than in its consistent espionage—including on this very estate—and frequent cyber-attacks against national infrastructure. Given that the Minister’s Department is responsible for the final decision in this case, can he tell the House whether he will do the right thing by national security and pull the plug?

[Matthew Pennycook]

I am not going to comment on specific considerations that will be taken into account. I have been very clear that we will continue to develop a consistent and pragmatic approach to the People’s Republic of China on economic engagement, and we will not compromise our national security. We have been very clear that China poses a series of threats to UK national security, and I have been as clear as I can be that national security considerations, along with all other material planning considerations, will be taken into account when reaching a decision. As I have said, it is for Planning Ministers to reach that decision, on or before 20 January.

[Ben Obese-Jecty (Huntingdon) (Con)]

We seem to be in the Chamber every three weeks to address espionage and security concerns with regards to China, be it spying, hacking, or the Government’s failure to add China to the enhanced tier of the foreign influence registration scheme. China is not an ally, and it features as a security threat in our own security strategy. The Chinese previously stated that they would not resubmit their application after it was rejected unless they were given assurances that it would be approved. To that end, what assurances have been given to China; what are we expecting as a quid pro quo with regards to the rebuilding of our own embassy in Beijing; and what concerns have been raised by our Five Eyes partners, specifically the US?

[Matthew Pennycook]

I appreciate why the hon. Gentleman is tempting me on this matter, but as I have made very clear, it would be completely inappropriate for me to comment from this Dispatch Box on national security considerations in respect of this live case. On his specific question of whether China has been given a commitment that permission will be granted, the decision is being taken by my Department in line with statutory provisions governing planning decisions and published propriety guidance, and as I keep saying, no decision has yet been made on the case.

[Jim Allister (North Antrim) (TUV)]

Why are this Government so evidently in awe of the Chinese Government and their requirements? Is one of those requirements that this mega-embassy be approved before the Prime Minister visits Beijing?

[Matthew Pennycook]

I simply do not accept that characterisation of the Government’s approach to China. We have to take a consistent and pragmatic approach, but we recognise that China poses a series of threats. As I have said, no decision has yet been made on this case, and all material planning considerations will be taken into account when one is made.

[Mr Joshua Reynolds (Maidenhead) (LD)]

I have raised multiple times with the Government the harassment of a constituent of mine, Carmen Lau, by the Chinese authorities. This has included bounty letters, deepfake pornography and her family being interrogated by national security agents in Hong Kong. Every time I am told that the safety of Hongkongers is of the utmost importance to the Government. Given that, does the Minister accept that to approve this application while China is still committing transnational repression would be a kick in the teeth to Hongkongers such as Carmen?

[Matthew Pennycook]

The safety of Hongkongers is of the utmost importance to this Government, and we remain steadfast in our support for the Hong Kong community in the UK. I understand why the hon. Gentleman is asking me, but I cannot comment on a live planning case that is before Planning Ministers in my Department.

[Jim Shannon (Strangford) (DUP)]

It is no coincidence that a week ago, a Protestant church in Chengdu, in Sichuan province in China, was raided by Chinese authorities. The pastor, the elders, and those who attended the church were arrested. What are the Government doing? The facts revealed in the plans for the embassy show a potential risk that must be explored. By all means, the Chinese should have a consulate to enable their citizens to have consular help, but not one that seems so elevated that it poses a threat to national security. The planning question is whether a basement is a real requirement of a functioning consulate. Will the Minister prove that national security will always be the priority?

[Matthew Pennycook]

I recognise the hon. Gentleman’s long-standing and passionate advocacy for people across the world to be able to practise their faith freely. In relation to the planning applications that are in front of us, all the relevant inquiry information was submitted as part of the independent public inquiry. At the point at which the inspector handed us a report, my Department sought further information specifically in relation to those redacted plans, so that we are able to take a decision that takes into account all the material planning considerations in this case. As I have said, we will issue that decision on or before 20 January.

[Sir Julian Lewis]

On a point of order, Madam Deputy Speaker. I was hoping to ask this point of order of Mr Speaker, because it is a little difficult for you, not having been here for most of the urgent question. At the start of the urgent question, Mr Speaker made it clear that he was surprised that a Minister was being put up who would not be able to answer questions, being a Planning Minister, rather than a Security Minister being put up, who would be able to answer questions.

In my 28 years in this House, I have attended many ministerial statements and the questioning that follows, and many urgent questions since they were introduced. Never before has there been an occasion that I have seen where every question asked on both sides of the House was deeply hostile, as was the case today, regarding what the Government were proposing to do. My question is this: if my hon. Friend the Member for Rutland and Stamford (Alicia Kearns) were to reapply to Mr Speaker for a similar urgent question in anticipation that an appropriate Minister—a Security Minister—will be put up to answer it, would that be within the rules of parliamentary order and practice?

Oral Answers to Questions

Matthew Pennycook Excerpts

Monday 12th January 2026 Commons Chamber

[Dame Caroline Dinenage (Gosport) (Con)]

18. What steps he is taking to strengthen the rights of leaseholders.

[The Minister for Housing and Planning (Matthew Pennycook)]

Leasehold and commonhold reform are key priorities for this Government, and we remain absolutely determined to honour the commitments made in our manifesto and finally bring the feudal leasehold system to an end in this Parliament. We have already brought into force a range of provisions from the Leasehold and Freehold Reform Act 2024, and we will progress the required secondary legislation to commence many more this year. We also intend to publish an ambitious draft commonhold and leasehold reform Bill in the coming weeks.

[Tulip Siddiq]

The leaseholders on the Hillcrest estate in Highgate in my constituency have written to me, because they have 84 years left on their leases. They are unsure whether they should wait for the Government reforms—which they welcome, by the way—or proceed with lease extension now to avoid the costs of incurring marriage value. Their fear, to which I am very sympathetic, is that they will extend under the current law and then better terms will be brought in by new legislation. I know the Minister has just said that reforms will happen in this Parliament, but may I ask him urgently to provide further clarity on the timings of the proposed reforms? Any savings from those reforms could have a huge impact on 100 of my constituents living on the Hillcrest estate.

[Matthew Pennycook]

I appreciate fully that leaseholders with leases approaching 80 years remaining want clarity on when the enfranchisement provisions in the 2024 Act will be brought into force. To bring those provisions into force, we need to not only consult on valuation rates, but rectify through primary legislation the small number of serious flaws in the 2024 Act that the previous Government bequeathed to us. The latter is obviously a more challenging proposition than the former, but we intend to make the necessary fixes as soon as possible so that leaseholders can begin to benefit from the new valuation process. I am more than happy to speak to my hon. Friend in further detail about the way in which we plan to take these reforms forward.

[Yuan Yang]

I was glad to get involved in the Government’s recent consultation on property service fees. More than 700 of my constituents living in new builds in and around Reading have written to me about high fees and unfair behaviour from property management agents. One constituent, called Sunil, said to me:

“We are throwing our money down the drain to these crooks, and they know they can take advantage.”

Will the Housing Minister meet me and my fellow Labour MPs working on this issue to discuss what more can be done to crack down on such awful behaviour from rogue agents such as FirstPort?

[Matthew Pennycook]

The Government are determined to reduce the prevalence of private estate management arrangements and to provide those who currently live on freehold estates with greater rights and protections. To that end, we launched two comprehensive consultations before Christmas; I am very glad to hear that my hon. Friend has engaged with those consultations, and I encourage all hon. Members from across the House to do the same. I am more than happy to meet a group of Labour colleagues to discuss the consultations and our proposals in more detail.

[Mary Kelly Foy]

Residents of the Aykley Woods development in my constituency have recently been informed that collectively, they will be charged £15,000 this year for the management company to run their estate of just over 270 homes, on top of a scandalous £31,000 just to cover the running costs of the management company itself. This is happening to millions of homeowners up and down the country, so does the Minister agree that it is long past time that we end the scandal of freeholders being locked into agreements with management companies and make local authority adoption the default for new builds?

[Matthew Pennycook]

The case that my hon. Friend draws the House’s attention to highlights the unfair charges that so many residential freeholders are subject to. As well as acting to reduce the prevalence of privately managed estates, which are the root cause of the problems experienced by residential freeholders, we are committed to implementing new consumer protections for homeowners on freehold estates. The consultation launched before Christmas seeks views on how, not whether, we implement the relevant provisions in the Leasehold and Freehold Reform Act 2024. I know that my hon. Friend will ensure that her constituents are supported in sharing their views on the subject as part of that exercise.

[Dame Caroline Dinenage]

So many of my Gosport constituents are locked into lousy leaseholds, and are so tired of seeing service charges rise while the quality of service falls. Bills are often eye-watering, and are quite often completely opaque. As the Minister said, the Conservatives passed the Leasehold and Freehold Reform Act, which gave leaseholders more powers to better scrutinise and challenge those costs. However, on the Minister’s watch, implementation is painfully slow. Why the delay? When will leaseholders begin to see the benefits of legislation that was designed to put an end to a practice that he himself has described as “unfair and unreasonable”?

[Matthew Pennycook]

I fully appreciate the wish of leaseholders in the hon. Lady’s constituency and those across the country to see these reforms introduced. She is absolutely right that the 2024 Act included measures to enhance transparency around service charges, to make it easier for leaseholders to challenge unreasonable service charge increases. Last July, we consulted on how to introduce those measures. It is a very technical consultation and quite a lengthy document—I draw the hon. Lady’s attention to it. We will introduce the necessary secondary legislation this year, so that leaseholders can benefit from those provisions.

[Sarah Green (Chesham and Amersham) (LD)]

Residents of a retirement village in my constituency are concerned that existing legislation removes normal leasehold protections for those living in retirement communities, leaving residents with weak, unenforceable operator promises. Can the Minister clarify what protection upcoming leasehold reforms will introduce for retirement village residents to ensure greater transparency and fairness?

[Matthew Pennycook]

As you would expect, Mr Speaker, I cannot pre-empt what will be contained in our draft commonhold and leasehold reform Bill, but if the hon. Lady wishes to write to me about the specific issue, I would be more than happy to provide her with a comprehensive response.

[John Glen (Salisbury) (Con)]

Just before Christmas, Mr Rahman, a leaseholder in a Taylor Wimpey property, came to see me. There are 100 years remaining on his lease and a modest ground rent, but he cannot secure a sale because Taylor Wimpey will not agree to a reasonable deed of variation in relation to the ground rent provisions. He has incurred costs of upwards of £5,000 and is basically stuck in his property, so I would be very grateful if the Minister could look at this case—I have written to him—and see whether his plans will address this poor individual’s circumstances.

[Matthew Pennycook]

In general terms, anyone considering extending their lease or acquiring their freehold should obviously consider seeking specialist advice from a solicitor or surveyor, but I will ensure that the right hon. Gentleman receives a prompt answer to his question as to whether any of the reforms we are taking forward will give some redress to his constituent.

[Mr Speaker]

I call the Chair of the Select Committee.

[Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)]

I thank the Minister for his answer. I know that he has been taking a lot of time to debate and look at the issue of leasehold, and he can see the cross-party concern on behalf of many constituents up and down the country on this big issue, as well as the support for tackling it. We on the Select Committee are ready to help him by making sure that the legislation is right, fit and proper. I just want to tease out a further answer from the Minister. Can he confirm for the House that he is still on track to ensure that we end the issue of leasehold and commonhold by the end of this Parliament?

[Matthew Pennycook]

I thank my hon. Friend, the Chair of the Select Committee for that question. We remain steadfast in our commitment to the promises in our manifesto to bring the feudal leasehold system to an end. Despite the noises off from the usual naysayers, the imminent publication of our ambitious draft commonhold and leasehold reform Bill will be the beginning of the end for that system, which has tainted the dream of home ownership for so many households across the country. As my hon. Friend knows, this is a large, incredibly complex and technical piece of legislation, and I hope she and the rest of the House would agree that it is worth a brief extension to ensure that we get things right and avoid a deficient Act, such as the one that the previous Government left us with, which we are now having to fix through primary legislation.

[Dr Al Pinkerton (Surrey Heath) (LD)]

May I take the Minister back to the circumstances of constituents who are living in retirement communities? I have a community of constituents who live at Mytchett Heath, owned by Cognatum Estates. They are experiencing very high service charges, and I have written to the Minister about that before. They are made nervous by talk of delay. They are often on a fixed income with fixed-income pensions. They are getting older, and they want to enjoy their retirement in peace. Can the Minister offer them any reassurance today?

[Matthew Pennycook]

The hon. Gentleman has written to me about that issue and he has, if I may politely say, generated a huge number of questions on it. We have met about it on one occasion, I think, and I am more than happy to have another conversation with him to try to get to the root of his concerns.

[Mr Speaker]

I call the shadow Minister.

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

Leaseholders, like renters and prospective homeowners, have been made big promises by this Government. What assessment has the Minister made of the impact of botched local government reorganisation, cuts to the budgets of two thirds of England’s local authorities, delays to elections and the wholesale abolition of housing and planning authorities in England’s shires on the delivery of those promises? This is just another promise that the Government are not going to deliver, is it not?

[Matthew Pennycook]

Forgive me—I do not know whether the shadow Minister has come in on the wrong question—but I cannot see how local government reorganisation will, in any shape or form, influence in any way our ambitious leasehold and commonhold reform agenda.

[Mr Speaker]

I call the Liberal Democrat spokesperson.

[Gideon Amos (Taunton and Wellington) (LD)]

Fully 5 million leaseholders were plunged into the dark before Christmas and thousands report feeling angry and abandoned. Why, then, are the Government choosing to delay their ending of the feudal leasehold system? Will they go further and follow the calls from Lib Dems and others to regulate property agents and to cap extortionate service charges?

[Matthew Pennycook]

I will answer the hon. Gentleman directly: the unforeseen delays in question, which meant that we could not publish the draft Bill before Christmas, relate to nothing more than the fact that some elements of policy and drafting are still being finalised. As I have said, this is a large, incredibly complex and technical Bill. The House would support getting it right in the first instance, if that means a delay of a few weeks.

[Gideon Amos]

Leaseholders are being hit increasingly with flood risk and difficulty in getting insurance. Rockwell Green in my constituency has flooded twice in the last seven years. Why are the Government proposing to weaken the rules preventing development in areas of high flood risk, and how many homes will be affected in future by more flooding as a result?

[Matthew Pennycook]

We have not weakened protections against flooding. The draft of the national planning policy framework that is out for consultation remains clear that inappropriate development in areas at risk of flooding should be avoided by directing development away from areas at the highest risk. The consultation currently under way into the statutory consultee system retains the requirement for local authorities to notify the Secretary of State before approving developments that the Environment Agency has objected to. We are not weakening the protections in the way the hon. Member claims.

[Sean Woodcock (Banbury) (Lab)]

5. What steps he is taking to build more social and affordable homes in Banbury.

[The Minister for Housing and Planning (Matthew Pennycook)]

Our manifesto committed us to delivering the biggest increase in social and affordable house building in a generation, and we intend to do just that. Our £39 billion social and affordable homes programme will build around 300,000 homes over its 10-year lifetime, of which at least 60% will be social rent, ensuring that communities such as Banbury get the social and affordable homes they so desperately need.

[Several hon. Members rose—]

[Sean Woodcock]

Nearly 11,000 homes in Cherwell district have been granted planning permission but remain unbuilt. This causes understandable frustration for local residents and the thousands of people in housing need. Will the Minister set out what action the Government are taking to improve build-out so that much-needed homes are built and delivered?

[Matthew Pennycook]

My hon. Friend is a powerful advocate for the interests of Banbury, and he has rightly and forcefully conveyed the message that the communities he represents expect homes, infrastructure and services that have been promised as part of a planning approval to be delivered as quickly as possible. I am sure he will welcome the fact that the new draft national planning policy framework, on which the Government are currently consulting, proposes to strengthen national policies to ensure that major residential developments are deliverable within a reasonable period. He will also be reassured to know that we intend to take further action to incentivise faster build-out rates, drawing on the two consultations that we undertook last year.

[Calum Miller (Bicester and Woodstock) (LD)]

rose—

--- Later in debate ---

[Calum Miller]

Thank you very much, Mr Speaker, and I am grateful to my constituency neighbour for raising this important matter. I wonder whether the Minister can reassure my constituents, many of whom are struggling to find social housing and many of whom end up in Banbury, having come from my constituency. Will the social and affordable homes programme pay due attention to the challenges of providing social housing in rural settings, so that those who wish to remain within their communities are able to do so and do not put extra demands on towns such as Banbury?

[Matthew Pennycook]

Our new social and affordable homes programme does provide additional flexibility for certain tenures of housing that are more difficult and costly to provide, including rural housing. I am sure the hon. Gentleman will also welcome the changes in the draft NPPF, which, as I have said, is out for consultation, because they will further strengthen the provision of rural and affordable housing. We want to see much more of it than we are seeing at present.

[Liz Twist (Blaydon and Consett) (Lab)]

6. What steps he is taking to build more social and affordable homes in Blaydon and Consett constituency.

[The Minister for Housing and Planning (Matthew Pennycook)]

In July last year we set out a detailed five-step plan to deliver a decade of renewal in social and affordable housing. The plan includes the biggest boost to grant funding in a generation, the establishment of an effective and stable regulatory regime, and action to rebuild the sector’s capacity to borrow and invest in new and existing homes. All that—alongside investment in existing stock—will help to ensure that councils and housing associations throughout the north-east can deliver more homes.

[Liz Twist]

I am glad to see the Government focusing so much on building social housing, including some in my constituency, but it will also be important to maintain the stock once it has been built and to look at existing stock. Can the Minister say when the issue of rent convergence will be resolved?

[Matthew Pennycook]

The Government remain committed to implementing social rent convergence to support additional investment in new and existing social housing. We will announce a decision on how it will be implemented later this month, before the launch of the social and affordable homes programme. That decision will take into account the benefits to the supply and quality of social and affordable housing, and the impact on rent payers and welfare spending.

[Dan Carden (Liverpool Walton) (Lab)]

8. What steps his Department is taking to help tackle private rent inflation.

[The Minister for Housing and Planning (Matthew Pennycook)]

The Renters’ Rights Act 2025 contains provisions allowing tenants to challenge unreasonable rent increases. The new tenancy system will come into force on 1 May this year, at which point landlords will only be able to increase rents once a year to the market rate, and tenants will be able to challenge unreasonable increases at the first-tier tribunal. The Act will also put an end to unfair rental bidding practices and demands from landlords for large amounts of rent in advance.

[Dan Carden]

I regularly hear from constituents who are being pushed out of their homes by rip-off hikes from unscrupulous landlords. The average rents in Liverpool have risen by 8%, well above the average for England. I welcome the Government’s action through the Renters’ Rights Act to tackle unfair rent increases, but it concerns me that market rents will be used as a benchmark to prevent unaffordable rents from rising. How will the Government review the effectiveness of these measures, and, if necessary, will they consider further action in due course?

[Matthew Pennycook]

We will of course keep the implementation of the Act under continual review, but, as I have said, it allows tenants to challenge unreasonable rent increases at the first-tier tribunal, which will make a judgment on whether the increases are fair and meet that market-rate definition. We have, however, made it clear that the Government do not support the introduction of rent controls, including rent stabilisation measures, for the reasons that we debated at some length during the passage of the Bill.

[Mr Speaker]

I call the Father of the House.

[Sir Edward Leigh (Gainsborough) (Con)]

We all know that rent inflation, like all inflation, is caused by over-demand and lack of supply, and we can agree on the need to address problems by building more houses and tackling immigration, but does the Minister agree that the more controls and regulations are imposed on landlords, particularly small landlords, the more they will get out of the rented sector altogether, causing less supply and rent inflation which will hit vulnerable people?

[Matthew Pennycook]

I do not accept that all regulation is bad, which I think is the thrust of the right hon. Gentleman’s question. In many ways, we have clarified and made simpler the grounds for possession that landlords can use under the Act, but he is absolutely right to say that we need more supply of all homes, including in the private rented sector, and that we need to support the build-to-rent sector, which will be an important part of the market in coming years.

[Perran Moon (Camborne and Redruth) (Lab)]

9. What steps he is taking to build more social and affordable homes in Camborne and Redruth constituency.

[The Minister for Housing and Planning (Matthew Pennycook)]

On 11 November last year, I set out the full details of our £39 billion, 10-year social and affordable homes programme. In the coming weeks, we will provide registered providers with the remaining information that they need to finalise their business and future supply plans, so that they can submit large and ambitious proposals when bidding opens next month.

[Perran Moon]

Meur ras, Mr Speaker. With your good grace, I would like to take this opportunity to thank members of the emergency services, who responded so courageously across Cornwall during and in the wake of one of the worst ever storms to hit the duchy. I also thank the 600,000 people of Cornwall, who heeded pre-storm advice and kept fatalities, mercifully, to a minimum. The loss of one life is too many, but it could have been far worse. Over 1,000 trees are down, and hundreds of thousands of people were plunged into darkness, with no power. I hope that Ministers will create the appropriate forum to discuss the lessons learned from Storm Goretti.

The Secretary of State has confirmed that, because of our unique status, Cornwall will be a single strategic authority for the purposes of devolution. The greatest threat facing the constituents of Camborne, Redruth and Hayle today is the lack of social and truly affordable homes, which is compounded by the 14,000 second homes and 25,000 Airbnbs, leading to an exodus of our young people and a chronic lack of key workers. Given these factors—

[Mr Speaker]

Order. I gave a lot of leeway at the beginning of the question. I think the Minister will have got the message already.

[Matthew Pennycook]

I think the thrust of my hon. Friend’s question was about what arrangements can be put in place for Cornwall so that it can better deliver housing and regenerate areas that have been identified by the council. As he will know, strategic place partnerships are reserved for mayoral strategic authorities that bring together more than one council into a combined authority. That said, and not least as a result of hearing representations from my hon. Friends who represent Cornish constituencies, I encourage Homes England to deepen its partnership with Cornwall council and to explore a memorandum of understanding or similar partnership agreement to support its ambitious housing and regeneration plans.

[Sonia Kumar (Dudley) (Lab)]

11. If he will make an assessment with Cabinet colleagues of the potential merits of establishing a statutory national register of electricians.

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[Alex Baker (Aldershot) (Lab)]

12. What steps he is taking to build more social and affordable homes in Aldershot constituency.

[The Minister for Housing and Planning (Matthew Pennycook)]

At the spending review in 2025, we announced record investment to kick-start social and affordable housing at scale across the country. Alongside regulatory certainty and stability and measures to rebuild the capacity of registered providers after their weakening over the previous 14 years, we are ensuring that communities in Aldershot will get the social and affordable housing they need.

[Alex Baker]

A veteran in my constituency who is the father of five young daughters has spent nearly three years waiting for a four-bedroom social home while raising his family in a two-bedroom property. He has now been told that the wait could be a further three years, which means six years of overcrowding for a family simply needing space to live and grow. Sadly, that is not an isolated case. Last year in my constituency, over 100 families were waiting for a four-bedroom social home, but only 31 were allocated one. I welcome the Government’s commitment to building more social homes, but what are they doing to make social housing more flexible so families are not left waiting for years for the right home at the right time?

[Matthew Pennycook]

I am sorry to hear about the long wait that the veteran in question is facing. It is important that we build more social rented homes after 14 years of engineered decline, which is why 60% of our £39 billion social and affordable homes programme will be allocated to social rented homes. However, it is also important we ensure that veterans get the priority they need, which is why in November 2024 we made changes to the local connection requirement to ensure that veterans have greater access to social housing and should be prioritised in the way that that allows.

--- Later in debate ---

[Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)]

16. What steps his Department is taking to help support house building in Stoke-on-Trent.

[The Minister for Housing and Planning (Matthew Pennycook)]

The Government are taking concerted action to boost rates of house building across England, including reforming the planning system and allocating record levels of grant funding support for social and affordable house building over the coming years, to the benefit of Stoke-on-Trent and the rest of the country.

[Gareth Snell]

I thank the Minister for that answer. Stoke-on-Trent has benefited from money from the brownfield regeneration fund. However, there are many brownfield sites across the city that could be used for local planning development, but the owners are simply not engaging with the process. Given that we are not in a mayoral combined authority, compulsory purchase powers are limited. Will the Minister consider devolving those powers to authorities like Stoke? If not, will he consider allowing interim development corporations, until such time as we have a mayor in place?

[Matthew Pennycook]

My hon. Friend is a doughty champion for his constituency, and he continues to make a powerful case for the renewal of Hanley city centre as the commercial heart of north Staffordshire. I have had a series of constructive meetings with him and other local leaders about the Hanley masterplan. I know he will welcome the £8 million of investment in Burslem town centre, delivering 800 homes. I am more than happy to continue the conversation with him about the possibility of a new locally led development corporation to take forward the regeneration of the city centre.

[Peter Prinsley (Bury St Edmunds and Stowmarket) (Lab)]

T1.   If he will make a statement on his departmental responsibilities.

--- Later in debate ---

[The Minister for Housing and Planning (Matthew Pennycook)]

While I appreciate my hon. Friend’s concern, we have strengthened policies in the draft national planning policy framework, which is currently out for consultation, that will ensure that major residential schemes are built out in reasonable time. I am more than happy to have a conversation with her about how that may impact developments in her constituency.

[Munira Wilson (Twickenham) (LD)]

T2. The Secretary of State will be aware that the so-called fair funding settlement will leave my council of Richmond upon Thames some £29 million worse off over the next three years. It will leave our most vulnerable residents, including children with complex needs and elderly people, facing cuts in critical services, even if the council raises council tax by 5%. Will he extend the transitional period?

[Gill Furniss (Sheffield Brightside and Hillsborough) (Lab)]

T5.   Every two hours, someone in the UK is paralysed as a result of a spinal cord injury. After treatment, there is a 20% chance of being sent to a care home due to a lack of suitable available housing. I cannot imagine how a young person feels when they are coping with one of the most traumatic moments of their life, and are literally left lying by themselves. That is unacceptable. Will the Minister meet me and the all-party parliamentary group on spinal cord injury to discuss the serious lack of suitable housing?

[Matthew Pennycook]

I thank my hon. Friend for that question. We have made proposals in the draft NPPF, which is out for consultation, to set new, higher requirements for authorities to deliver more accessible housing. This includes proposals to make meeting accessibility standards mandatory for 40% of new builds, and to ensure that local plans provide for wheelchair-accessible homes. I am more than happy to have another conversation with my hon. Friend on this issue.

[Martin Wrigley (Newton Abbot) (LD)]

T6. In February’s Government consultation on local government reorganisation, will the Minister consult on all four—I think it is four—options put forward by Devon, and how will she weight the criteria, so that she can decide on a selected, amended or perhaps new proposal in June?

--- Later in debate ---

[Matthew Pennycook]

I am sorry to hear about the challenges that my hon. Friend’s constituents face at the hands of their landlord. Tenants who are unhappy with their landlord’s handling of complaints can go to the Housing Ombudsman, and the Regulator of Social Housing can investigate evidence of systematic failure. My hon. Friend is welcome to keep me updated on whether his constituents see any improvement in the services being provided over the coming months.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

T7. The Government insist on forcing through local government reorganisation when there is no agreement in Leicestershire. There are three different plans ahead. One thing that Leicestershire does agree on is no expansion of Leicester city. Will the Minister put that to the test and have a referendum on it, so that the people of Leicestershire can show the Government just how much they do not want the city expansion?

--- Later in debate ---

[Dr Simon Opher (Stroud) (Lab)]

In Stroud, we have 4,000 council houses; we need at least double that. Will the Minister look again at the constraints that councils are under and see whether the Government can enable them to build more council houses?

[Matthew Pennycook]

We are committed to reinvigorating council house building, which is essential to boost and sustain higher rates of housing supply in the years ahead. We have already taken decisive action to support councils to build at scale once again, including reforming the right to buy and launching the council house building skills and capacity programme, but we will of course keep the matter under review to see what further support we can provide.

[Dr Ellie Chowns (North Herefordshire) (Green)]

When will the Government take steps to address embodied carbon in buildings?

[Matthew Pennycook]

The hon. Lady can look forward to the future buildings standards being brought into force later this year.

[Chris Vince (Harlow) (Lab/Co-op)]

Across the winter months, I have received an increased amount of casework from residents of Harlow who are suffering from damp and mould in their houses. They deserve quicker repairs and higher standards from landlords. Of course, Awaab’s law is to be welcomed, but will the Secretary of State confirm what enforcement measures will be used to ensure that landlords adhere to the legislation?

--- Later in debate ---

[Catherine Atkinson (Derby North) (Lab)]

Hundreds of new homes are being built at the Friar Gate goods yard, originally a 19th-century rail depot. This development is near the city centre, but other housing that was built further out under the Conservatives went up with inadequate transport infrastructure and little thought for public transport. What is being done to ensure that new homes have the transport infrastructure that they need?

[Matthew Pennycook]

I am more than happy to sit down with my hon. Friend and discuss the matter in more detail.

[Jess Brown-Fuller (Chichester) (LD)]

Constituents on a new build estate in Chichester were ordered without warning to pay an extra £180 a month on top of the £212 that they were already paying. When the Government bring forward their planned legislation, will they stamp out these enormous price hikes and will they hold road management companies to account?

[Matthew Pennycook]

As I have said, we are intending to switch on the relevant provisions in the Leasehold and Freehold Reform Act 2024 that provide consumers with protections. I would encourage the hon. Lady to submit her views to the consultation, and I am more than happy to pick this up with her outside the Chamber.

[Anneliese Midgley (Knowsley) (Lab)]

Will the Minister consider enabling all local authorities in the most deprived areas to have an above-average increase in core spending power in each year of the local government multi-year settlement, including in Liverpool city region?

Freehold Estates Consultations

Matthew Pennycook Excerpts

Thursday 18th December 2025 Written Statements

[The Minister for Housing and Planning (Matthew Pennycook)]

For too many homeowners, the experience of living on a newly developed housing estate has been tainted by the hidden and enduring consequences of unadopted infrastructure. Roads, sewers, drains, green spaces, and other amenities that historically would have been maintained by the local authority or utility companies, are instead now routinely left to be managed by private estate management companies, often with little transparency or accountability.

In many cases, the quality of the amenities on such freehold estates is inferior to those adopted by the relevant public authority and falls far short of what people have a right to expect. Residential freeholders across the country frequently report open spaces not fit for purpose, roads left unsurfaced, and drainage systems which are often little more than open ditches. These issues blight people’s lives and with few of the rights to redress found in other markets and no ability to control the management of the estates on which they live, residents feel like they are treated as second-class homeowners.

The Competition and Markets Authority’s 2024 house building market study identified significant consumer detriment arising from the private management of unadopted public amenities on housing estates. It concluded that without Government intervention, this consumer detriment was likely to increase. This Government believe that homeowners living on freehold estates deserve a fair deal. That is why we pledged in our manifesto to act to bring the injustice of “fleecehold” private housing estates and unfair maintenance costs to an end.

Our objective is clear. We are determined to reduce the prevalence of private estate management arrangements, which are the root cause of the problems experienced by many residential freeholders. We also want to provide those who currently live on privately managed estates with greater rights and protections so that the fees they pay are fair, transparent, and robustly justified.

That is why we are today launching two comprehensive consultations seeking views on how best to implement new consumer protections for homeowners on freehold estates and the ways in which we might reduce the prevalence of privately managed estates over the coming years.

Enhanced protections for homeowners on freehold estates

The Government are already taking action to protect homeowners living on privately managed estates. We are committed to strengthening regulation of managing agents and have consulted on proposals to introduce mandatory professional qualifications for managing agents and estate managers on these estates, protecting homeowners from poor practice and unscrupulous operators.

We also intend for homeowners on privately managed estates to benefit from the proposals we announced on 6 October to transform home buying and selling. These will reduce delays, strengthen upfront information for all homebuyers, and cap unreasonable fees for providing property details.

We have also asked the Law Commission to consider how homeowners on freehold estates might secure greater control over the management of their estates, including whether the existing right to manage regime could be adapted for privately managed estates. That programme of work is now live and can be found on the Law Commission website at: https://lawcom.gov.uk/project/management-of-housing-estates/.

However, we know we must do more to protect homeowners already living on freehold estates. That is why this Government intend to introduce primary legislation to ban the use of the draconian remedies in sections 121 and 122 of the Law of Property Act 1925 which are available when rentcharges are not paid.

Those remedies include rentcharge owners taking possession of the affected property until arrears are cleared and granting a lease over the property. Currently, these remedies can be used without notice for very small debts. This creates uncertainty for homeowners and lenders and increases home buying and selling costs. We also seek views on whether these remedies should be removed entirely for all types of rentcharges, ensuring that enforcement is proportionate and fair. Additionally, we plan to put in place a free advice service for homeowners on privately managed estates.

The first of the two consultations we are publishing today seeks views on how we effectively implement the consumer protection provisions for residential freeholders contained in the Leasehold and Freehold Reform Act 2024. These provisions allow for the creation of a new regulatory framework that will make estate management companies more accountable for how homeowners’ money is spent. They will provide homeowners who pay an estate management charge with better access to information they need to understand what they are paying for; the right to challenge the reasonableness at the first-tier tribunal; and the right to go to the tribunal to appoint a substitute manager.

Implementing these consumer protection provisions requires detailed secondary legislation. To help shape that legislation and ensure we are implementing these new consumer protections effectively and to the benefit of all homeowners, we want to hear from individual homeowners, estate managers and managing agents.

Reducing the prevalence of private estate management arrangements

The second of the two consultations we are publishing today seeks views on how we reduce the prevalence of private estate management arrangements. Building on the recommendations of the Competition and Markets Authority’s 2024 house building market study, it aims to better understand the root causes and incentives that have led to the rise of unadopted amenities and what credible options for reform exist.

The consultation explores and seeks views on how to remove barriers to adoption and improve processes through common standards for amenities and adoption procedures. It explores how we might remove the perverse incentives that are driving non-adoption to help reduce friction between developers and local authorities and make adoption more straightforward.

It also asks for feedback on whether certain amenities should be subject to mandatory adoption and by whom, to reduce fragmented ownership and improve service delivery. Finally, the consultation also looks at how to improve dispute resolution mechanisms for poor-quality amenities and adoption issues as well as improving transparency, alongside proposals for a new affordability assessment so that maintenance of communal amenities is sustainable for homeowners in the long-term.

We recognise that not all new freehold estates will be adopted, so we need to ensure that we are giving homeowners, or prospective homeowners, greater control. The consultation therefore seeks views on whether to prohibit “embedded” management company arrangements and make resident-controlled management the default where adoption is not feasible.

The options for reform we are exploring through this consultation are far-reaching and have implications for housing supply and local authority budgets, so it is vital that future policy decisions are informed by robust evidence and a wide range of views. Through the consultation, we aim to engage residents, local authorities, developers, and estate management companies to deliver meaningful and lasting solutions.

Together, we want to build a system that works for everyone; one in which estates are well-managed and homeowners are protected, empowered and free from the burdens of hidden and unfair charges.

[HCWS1210]

Housing Development: Cumulative Impacts

Matthew Pennycook Excerpts

Wednesday 17th December 2025 Westminster Hall

[The Minister for Housing and Planning (Matthew Pennycook)]

It is a pleasure to serve with you in the Chair, Mr Twigg. I congratulate the right hon. Member for East Hampshire (Damian Hinds) on securing this important debate today, and for introducing it with his customary clarity and civility. It has been a thoughtful and considered debate and I thank all other hon. Members for the contributions they have made. Whether it is simply the result of good fortune or the product of the right hon. Member’s powers of persuasion, this is not the first time we have debated house building in his constituency this year. We also had—as he made reference to—what I hope he will agree was a useful meeting back in March with officers from East Hampshire district council to discuss the challenges his local planning authority faces in setting housing requirements, given the proportion of it covered by the South Downs national park.

In the time I have available to me I intend to address the main points raised by the right hon. Gentleman and other hon. Members, with the usual caveat that I am unable to comment on individual local plans or planning applications, given the role of MHCLG Ministers in the planning system.

I will start with some general comments on housing targets, given that the right hon. Gentleman was perfectly clear in his remarks that they are at the heart of his concerns, but I will also touch on the interesting points made on affordability more generally and on tenure mix. In the NPPF published on 12 December last year, we restored mandatory housing targets that were abolished by the previous Government. We restored them, as our manifesto committed us to doing. It means local authorities must use the standard method as the basis for determining housing requirements in their local plans.

However, we have almost always made it clear that a mandatory method is insufficient if the method itself is not adequate to meet housing need. That is why the NPPF, published last year, introduced a new standard method for assessing housing need that is aligned to our stretching plan for change target of building 1.5 million new safe and decent homes in England by the end of this Parliament. I gently say to the shadow Minister: if he calls that number unrealistic, in his own manifesto, in the bidding war that was pursued during the general election, his own party came out with a 1.6 million number. How a Conservative Government would have set about achieving that is a question for another day.

The right hon. Gentleman mentioned affordability with both a capital and a lower case “a”; in its lowercase sense, I say to him that boosting the supply of homes of all tenures has to be at the heart of any strategy to address affordability. There is a wealth of evidence that building more housing for private market sale makes other types of housing more affordable now. Such is the mismatch between housing supply and demand—the result of successive Governments not building enough homes of all tenures, and I include my own party as well as his in that. Tenure obviously still matters. We look primarily to local planning authorities to set the tenure mix in their own local areas, but the draft framework that we published yesterday includes firmer expectations in relation particularly to housing sites over 150 units. We want to see the right type of housing come forward.

[Damian Hinds]

The Minister is very good to give way; I thank him. To be clear, when I was talking about the mix, I was not talking solely or even mainly about the tenure mix, but about the price points and the way that the formula works—he gets the point.

[Matthew Pennycook]

The point was well made and well understood, and I will address it shortly. The new standard method that we introduced relies on a baseline set at a percentage of existing housing stock levels to better reflect housing pressures right across the country. It uses a stronger affordability multiplier to focus additional growth on the places facing the biggest affordability challenge. In general terms, it is a vast improvement on the standard method it replaced, which was based on household projections that were volatile, subject to change every few years and subject to unevidenced and arbitrary adjustments, with the result that local planning authorities found it extremely difficult to plan for housing over their 10 to 15-year plan periods.

I did, in response to the question put to me yesterday by the right hon. Gentleman, give a pithy and straightforward answer. The Government have no intention of withdrawing or modifying the standard method that is now in operation. On the specific point he raised, where affordability ratios fall, the uplift would also fall because it applies over an affordability ratio of 5:1—that is the Office for National Statistics affordability threshold.

I think I understood the right hon. Gentleman’s point about the short-term impact, but the only way to bring the affordability ratio down is to build many more homes of all types, and that is what the target is intended to do. However, it is a complex and technical point and he may wish to write to me on it.

[Damian Hinds]

I will write to the Minister in more detail—but if, in adding to the stock, we raise the median house price, that has an adverse effect on affordability. We get this ironic situation where the more we build, the less affordable it looks.

[Matthew Pennycook]

I do not think that is correct—at least not in the medium to long term. Going back to the point I just made about supply and demand, we have to build sufficient volumes of homes to arrest the steady rise over many years in house prices and start to gently bring them down over time. We are some way away from that, but the affordability uplift should respond over time if we start to build, in a high and sustainable manner, the large number of homes we need.

I will now address the rural-urban balance, which was raised by a number of colleagues. We have had this debate before. We recognise that the targets we have introduced are ambitious and they do mean uplifts in many areas, but such is the severity of the housing crisis in England that all parts of the country, including rural areas, must play their part in providing the volume of homes the country needs.

However, it is not the case that the new formula directs housing growth away from large urban areas. We scrapped the arbitrary 35% urban uplift that the previous Government applied to the 20 largest cities and urban centres—and the core of those centres, as was mentioned. However, across city regions, the new standard method increases targets by 20%. Through it, housing growth is directed to a wider range of urban areas, including smaller cities and urban areas as well as larger city areas.

London was referenced; under the previous Government, housing targets in London were deliberately set at entirely unrealistic levels because that arbitrary 35% standard method was applied not just to the core of our capital city, but to every London borough. We have revised that number down, but London still has a stretching house building target, which we increased in response to feedback to the consultation we received.

In the draft framework yesterday, as the shadow Minister and other hon. Members recognised, we also gave more support for a brownfield-first approach to housing. We welcome responses to the draft framework, through which we now have in-principle support for development within settlements, subject to specified exemptions where there could be unacceptable impacts. We have built on that with the announcement of a default “yes” for development on land within reasonable walking distance around train stations.

Local plans have been mentioned a number of times; in some ways, this gets to the heart of the matter. I would first say to the Liberal Democrat spokesman that, far from undermining the plan-led system, the announcements we made yesterday will strengthen the plan-led system. The clear, rules-based policies in that new draft framework will make it easier for local authorities to come forward under the new system of local plan making and get those plans in place more quickly and effectively.

Why do they need to be in place more quickly and effectively? Because authorities with an up-to-date local plan will typically meet the five-year housing land supply, which is what is required to pass the examination in the first place. Having a local plan in place supports a much more comprehensive approach to considering cumulative impacts of development, so we need those local plans in place across the country. It is not my party’s fault that we do not have universal coverage of local plans. I remember standing for years where the shadow Minister is now, telling Conservative Housing Ministers on this side of the Chamber to take effective action to use the full range of their intervention powers to drive up local plans. We are not there, but this Government are committed to doing that.

The right hon. Member for East Hampshire knows about this, as we have discussed it before: local authorities are able to justify a lower housing requirement than the figure that the standard method sets, on the basis of local constraints on land and delivery, such as natural landscapes, protected habitats and flood-risk areas.

[Cameron Thomas]

I thank the Minister very much for giving way, and I wish him a merry Christmas. Nothing would empower my local authority more than the Government implementing recommendation 89 of the EAC’s report into flood resilience in England. Will his Department do that?

[Matthew Pennycook]

We will respond in due course to that report, in the usual way. I take the hon. Gentleman’s point about flood risk; I am trying to set out that local constraints can be taken into account in the context of local plans. Government provide flexibility in policy for areas that have such local constraints when calculating housing needs and setting targets, and we provided further guidance on the matter alongside the December 2024 NPPF.

East Hampshire district council is availing itself of that flexibility through the use of a locally determined method, as part of its efforts to progress towards submitting its plan for examination. My officials have been actively supporting that process, including by facilitating an advisory visit for the Planning Inspectorate, and I will continue to meet with officers to discuss any further support.

Several hon. Members mentioned the duty to co-operate. Local authorities often face pressure from neighbouring authorities to meet unmet housing needs under the duty. I recently announced that the duty as a legal provision will cease to exist once the new planning system regulations come into force early next year. However, East Hampshire and neighbouring authorities will still be expected to show that they have collaborated across boundaries, including on meeting unmet need, in line with the current and draft NPPF, which set out policies on maintaining effective co-operation.

I understand hon. Members’ long-standing concerns about infrastructure. The Government are aware that there is more to do across Government and with the sector to ensure that the right infrastructure gets built. I draw hon. Members’ attention to the remarks I made in the statement yesterday. The previous NPPF, from December 2024, strengthened the support for infrastructure —particularly essential infrastructure such as health services and schools—and the latest draft, which we published yesterday, consolidates and strengthens that. On top of that, through the Planning and Infrastructure Bill, which should receive Royal Assent this week, we are streamlining the delivery of nationally critical infrastructure, from rail to roads to reservoirs, across the country.

The shadow Minister asked me about section 106. We want to see a simpler, more transparent and more robust section 106 system. That should include standardised templates. As the NPPF published yesterday shows, we think that, in the first instance, that should be rolled out on medium sites.

To conclude, I thank the right hon. Member for East Hampshire once again for giving the House an opportunity to discuss this important range of matters. As in our debate earlier this year, I appreciate that I will not have convinced him of the merits of the Government’s approach to planning reform or the standard method, but I hope that I have provided him and other hon. Members with sufficient reassurance in respect of local plans, infrastructure and other important matters. I too wish all hon. Members, you, Mr Twigg, House staff and officials a merry Christmas. I hope that everyone has a well-deserved break.

Planning Reform: Next Phase

Matthew Pennycook Excerpts

Tuesday 16th December 2025 Written Statements

[The Minister for Housing and Planning (Matthew Pennycook)]

England remains in the grip of a housing crisis that is both acute and entrenched. The detrimental consequences of this disastrous state of affairs are now all pervasive: a generation locked out of home ownership; 1.3 million people languishing on social housing waiting lists; millions of low-income households forced into unaffordable private rented housing; and more than 170,000 homeless children living in temporary accommodation.

Our economy, and the public services we all rely on, are suffering too because, as well as blighting countless lives, the housing crisis is consuming ever-larger amounts of public money in the form of a rapidly rising housing benefit bill, and it is hampering economic growth and productivity by reducing labour mobility and undermining the capacity of our great towns and cities to realise their full economic potential.

The monumental scale of the challenge that this Government inherited demanded a commensurate response. That is why we committed ourselves, unashamedly, to an incredibly stretching house building target of 1.5 million new safe and decent homes in this Parliament. And it is why we acted quickly and boldly to put in place the foundations of a revamped planning system that will facilitate the delivery of high and sustainable rates of house building in the years ahead.

Within three weeks of taking office, we moved to consult on changes to the national planning policy framework, finalising them in December 2024. Among the many changes made in that initial revision to the framework were: the restoration and raising of mandatory housing targets; a new standard method for assessing housing needs aligned to our 1.5 million new homes target; greater support for social and affordable housing provision; a strengthening of policy relating to brownfield land development; a modernised, strategic approach to green belt land designation and release; and enhanced support for key economic sectors and clean energy infrastructure.

In March we introduced our landmark Planning and Infrastructure Bill. The Bill will speed up and streamline the delivery of new homes and critical infrastructure, supporting delivery not only of the Government’s 1.5 million new homes target, but of our plan for change milestone of fast-tracking 150 planning decisions on major economic infrastructure projects by the end of this Parliament. It will also support delivery of the Government’s clean power 2030 target by ensuring that key clean energy projects are built as quickly as possible. As a result of its swift passage, it is due to receive Royal Assent before the House rises on Thursday.

Over recent months we have carefully considered the extensive feedback we have received on a range of policy propositions, from a brownfield passport to reforming site size thresholds in the planning system. As a result, I am today setting out details of the next phase of this Government’s planning reforms alongside a comprehensive package of support for small and medium-sized house builders.

A revised national planning policy framework

We are today publishing a fuller and more definitive overhaul of the NPPF for consultation. It is the culmination of a sustained effort over the first 17 months of this Parliament to revamp our planning system so that it meets housing need in full and unleashes economic growth, and represents the most significant reform to national planning policy since the original NPPF was introduced more than a decade ago.

This wholly restructured framework maintains and builds on the initial revisions that we made in December last year; includes a range of new measures to support key economic sectors; and incorporates new clear and rules-based national policies for both plan and decision making. These proposals will make the NPPF easier to navigate for communities, local authorities and developers alike.

As a result of the not insignificant risk and uncertainty that such an approach entailed, we have taken the decision not to proceed with statutory national development management policies at this stage. Instead, we have chosen to swiftly realise their benefits through agile national policy changes, while leaving open the possibility of a future transition to statutory NDMPs, should that be required.

The new decision-making policies in the framework published today are therefore designed to make development management more certain, consistent and streamlined; to standardise policies that apply across the whole of England; and to reduce duplication and avoid unjustified local deviation from national policy in local plans. To ensure that these changes make an immediate difference, the Government are proposing that the new national decision-making policies effectively override conflicting policies in local plans from day one.

As part of this overall change to the framework, we are also proposing new policies to boost housing supply and unlock economic growth in the years ahead:

1. A permanent presumption in favour of suitably located development

We want to make clear what forms of development are acceptable in principle in different locations as part of creating a more rules-based approach to development. For urban land, this approach takes forward parts of our “brownfield passports” work and builds on the December 2024 framework update, by making development of suitable land in urban areas acceptable by default. As part of this change, we are also proposing a revised presumption in favour of sustainable development, underpinning the way the new policies direct different forms of development to the most appropriate locations—in effect, applying a permanent presumption in favour of suitably located development.

2. Building homes around stations

We want to establish “in principle” support—a “default yes” —for suitable proposals that develop land around rail stations within existing settlements, and around “well-connected” train stations outside settlements, including on green-belt land. We are also proposing a minimum density of 40 dwellings per hectare around all stations and 50 dwellings per hectare around “well-connected” stations—maximising opportunities for sustainable development, making the most of high levels of connectivity, and improving access to jobs and services.

3. Driving urban and suburban densification

We want to get the most use out of land in urban and suburban areas, including through the redevelopment of corner and other low-density plots, upward extensions and infill development—including within residential curtilages. These changes will support higher density development in sustainable locations, with good access to services. We are also setting clear expectations that authorities should set minimum densities in well-connected locations, including around train stations and town centres, and support an overall increase in density within settlements.

4. Securing a diverse mix of homes

We want to better support the needs of different groups through the planning system. This includes stronger support for rural social and affordable housing and setting clearer expectations for accessible housing to meet the needs of older and disabled people. It also means providing more flexibility on the unit mix of housing for market sale, where local requirements have been met for the mix of affordable homes.

5. Supporting small and medium sites

We want to make it easier to bring forward small sites, through clear support for the principle of development in different locations, the policies on building more densely in settlements, and strengthened support for mixed tenure development. We are also introducing a category of medium development (see annex C of this consultation document), linked to a range of policy and regulatory easements, to support a more streamlined and proportionate planning system—including exploring further the potential benefits and drawbacks of enabling developers to discharge social and affordable housing requirements through cash contributions in lieu of direct delivery.

6. Streamlining local standards

We want to promote certainty for applicants and speed up local plan production by limiting quantitative standards in development plans to only those specific issues where local variation is justified. We also want to limit duplication of matters that are covered by the building regulations—other than where there is the existing ability to use “optional technical standards”.

7. Boosting local and regional economies

We want to encourage economic growth by giving substantial weight to the benefits of supporting business growth, and to particular areas and sectors—including those named in the industrial strategy, AI growth zones, logistics, town centres and agricultural and rural development. We are also interested in views on whether the town centre sequential test should be removed, in order to allow greater flexibility to respond to changing patterns of demand.

8. Supporting critical and growth minerals

We want to ensure that adequate provision is made for their extraction, recognising their economic importance. In parallel, and in view of the Government’s mission to achieve clean power by 2030, we want to restrict further the extraction of coal.

9. Embedding a vision-led approach to transport

We want to further embed the changes made in December 2024, which signalled the importance of moving away from a “predict and provide” approach to transport planning, which can create unattractive environments dominated by cars.

10. Better addressing climate change

We want to set out how decisions can take a proactive approach to both mitigation and adaptation in relation to climate change, in a way that links to other relevant policies in the draft framework.

11. Conserving and enhancing the natural environment

We want to make a number of changes, including to reflect local nature recovery strategies, to recognise landscape character and conserve and enhance existing natural features, to incorporate swift bricks and to provide guidance on sites of local importance for nature.

12. Taking a more positive approach to the use of heritage assets

We want a clearer and more positive approach that can better support suitable heritage-related development, replacing the current policies that are difficult to navigate.

The framework will also support the implementation of reforms that I set out in the written ministerial statement of 27 November— https://questions-statements.parliament.uk/written-statements/detail/2025-11-27/hcws1104 —to deliver faster and clearer local plans, preserving their place as the cornerstone of the planning system. New plan-making policies in the NPPF will support the implementation of the new plan-making system by setting out policy on the role, content, preparation and examination of the plans of different types—including supporting the introduction of spatial development strategies across the whole of England to ensure effective planning across local authority boundaries.

The proposed new NPPF will play an integral role in delivering the new homes and essential infrastructure that the country needs and unlocking sustained economic growth. The consultation is an opportunity for everyone to play their part in shaping a planning system that delivers for local communities and the country as a whole.

Development plans will not be required to follow the revised framework until the final version is published, in accordance with the transitional arrangements set out within it. However, local planning authorities preparing plans under the new plan-making system should have regard to the draft framework to help inform the early stages of their production, bearing in mind the framework’s status as a consultation draft.

Support for small and medium-sized house builders

In addition to publishing a fuller and more definitive NPPF for consultation, the Government are acting to support small and medium-sized house builders. As a Government, we are clear that ramping up housing delivery requires us to diversify the house building market. Integral to such diversification is not merely arresting but reversing the decline of SME developers that has taken place over recent decades. Building on the steps we have taken to better support SME house builders to access finance and land, we are today announcing a series of policy and regulatory easements to help them thrive and grow.

In May the Government published a working paper seeking views on a new “medium” threshold for development for sites up to 1 hectare with between 10 and 49 homes—noting that over 80% of such sites are developed by SME builders. Having reflected on the useful feedback we received, we have decided to go further. While the 10 to 49 unit threshold will apply, we propose to increase the size of sites covered by the new medium category to up to 2.5 hectares, thereby increasing the number of SME house builders being supported.

To support development activity on this new category of site, we are proposing to limit information requirements to what is necessary and proportionate. We are also setting a clear expectation that local planning authorities allocate 10% of their housing requirement to sites between 1 and 2.5 hectares, in addition to the existing requirement to do so for sites under 1 hectare, to better support different scales of development.

Without compromising building and residents’ safety, we are also using the consultation to ask the necessary technical questions to determine whether to exempt this new “medium” category of development from the building safety levy. And we are exploring further the potential benefits and drawbacks of enabling developers of medium sites to discharge social and affordable housing requirements through cash contributions in lieu of direct delivery.

Finally, having considered carefully the responses to the consultation undertaken by the Department for Environment, Food and Rural Affairs earlier this year, I can confirm that the Government will exempt smaller developments up to 0.2 hectares from biodiversity net gain, and introduce a suite of other simplified requirements to improve the implementation of biodiversity net gain on small and medium sites that are not exempted. DEFRA will also consult rapidly on an additional targeted exemption for brownfield residential development, testing the definition of land to which it should apply and a range of site sizes up to 2.5 hectares.

Wider funding and support

To ensure the successful implementation of the changes to national planning policy and regulation that we are announcing today, the Government will provide additional funding and support.

We are making £8 million available to local planning authorities to accelerate planning applications for major residential schemes at the post-outline stage. This funding will be targeted at those authorities with high volumes of deliverable applications in this Parliament and those with strong economic growth potential, ensuring that resources are directed where they will have the greatest impact.

£3 million of this funding will be allocated to the Greater London Authority to provide specific support to London boroughs to bolster their planning departments and enable them to implement the emergency measures announced by the Mayor of London and the Secretary of State on 23 October 2025.

These measures build on the announcements set out in the Budget last month, where the Government have committed to spend an extra £48 million to strengthen planning capacity and support the aim to recruit around 1,400 new planning officers this Parliament—substantially exceeding our original commitment to recruit just 300.

We will also provide an extra £5 million to boost the roll-out of the small sites aggregator initiative across Bristol, Sheffield and the London borough of Lewisham, supporting SME builders to deliver much-needed social housing on 60 small brownfield sites that would otherwise remain undeveloped, and attracting private investment to build new social rent homes.

Beyond the planning system, this week we will launch an expression of interest for ambitious local planning authorities to work with us to create pattern books of standardised, high-quality house designs—intended to accelerate the delivery of attractive new homes and make use of artificial intelligence and modern methods of construction.

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