Oral Answers to Questions

Debate between Penny Mordaunt and Laura Sandys

Tuesday 5th July 2011 Commons Chamber

[Penny Mordaunt (Portsmouth North) (Con)]

1. What recent discussions he has had with constitutional historians and experts on House of Lords reform; and if he will make a statement.

[Laura Sandys (South Thanet) (Con)]

4. What recent progress he has made on his plans for House of Lords reform; and if he will make a statement.

Sheltered Accommodation

Debate between Penny Mordaunt and Laura Sandys

Wednesday 17th November 2010 Westminster Hall

[Laura Sandys (South Thanet) (Con)]

It is good to serve under your chairmanship, Mr Davies, and I would like to thank my hon. Friend the Member for Stourbridge (Margot James). The minute that I saw this debate listed in the Order Paper, I felt that I had to participate. For many years, my hon. Friend the Member for North Thanet (Mr Gale) and I have been running a local campaign. We have formed a group called the Thanet eight. It is eight buildings with over 1,500 residents who live in flats that are owned by one company, and were originally managed by the same company—Peverel.

Those residents are by definition not young, and their objective in buying their properties was to have safe, secure and affordable homes, possibly for the rest of their lives. The reality has been different with increased charges; expensive and sometimes unnecessary renovations; a lack of consultation of residents; the attempt to block the creation of active residents associations; a reduction in services, particularly house manager support; and disproportionate penalties if a property is sold or rented.

Age UK has recently raised this matter and completed a very comprehensive report highlighting four key issues that my local residents certainly experience: unfair transfer fees when a property is sold or rented; escalating service charges, compounded by a lack of transparency about what people are paying for; very expensive rents for house manager flats—mentioned by my hon. Friend the Member for Stourbridge—which do not reflect the market value at all; and the use of companies that are owned by the management companies to undertake work or provide services on behalf of residents.

In particular, I should like the Minister and the Government to examine what I call the vertical integration model. These businesses are being run by subsidiary companies where the group company owns the majority of the companies that provide services to these residential blocks. That throws up very interesting and questionable issues. I hope that those companies’ ownership of that vertically integrated supply chain causes concern to the Office of Fair Trading. The method by which they operate the vertically integrated business model is certainly of concern to consumer groups and, as I said, has been the subject of an Age UK report.

In my experience, the freeholders and management companies, which are all owned by the same holding company, own lift maintenance companies, buildings insurance firms—mentioned by my hon. Friend—building and maintenance operators, window cleaners and internal communications fitters. That might on the surface suggest that such a company knows its business well and understands all the different aspects of running sheltered accommodation, but is that really the case or is the vertical business model precluding competition, reducing choice for residents and creating incentives for the management company to propose and sometimes impose renovations, refurbishments or additional services that residents have not requested and do not desire?

[Penny Mordaunt]

It is not just the Office of Fair Trading that needs to be concerned. If a lift is not fixed or the night warden is not there, that will lead to potentially massive bills for the public purse. I am thinking of more hospital admissions, more people falling over and so on.

[Laura Sandys]

I very much welcome that intervention; I totally agree with my hon. Friend. We need to consider the holistic cost—the overall cost—of how in the future we will look after people who are getting older. Many years ago I wrote a paper called “How we keep the new old young”. That will be a big challenge for us. I am referring to how we keep people mobile and independent and ensure that they have the resources to be independent for as long as possible.

I now want to talk about the emotional impact and the worries and concerns of my local residents in Thanet, who have put their life savings into these small flats and do not have other resources. There is an emotional and physical impact from their concern about what will drop through their letterbox next week from the management company telling them that they owe another £1,500. That creates more health problems and anxiety and deters older people from making the independent choice and going for what is, on paper, excellent sheltered accommodation and a structure that gives them security for the future.