Question to the Department for Levelling Up, Housing & Communities:

To ask the Secretary of State for Levelling Up, Housing and Communities, what obligations managing agents have to refund the collection of service charges to which they are not entitled under the terms of a lease; and what recourse leaseholders have to take action against managing agents that issue invalid service charge demands.

We believe very strongly that service charges should be transparent and communicated effectively, and that there should be a clear route to challenge or redress if things go wrong.

If a landlord is not entitled to money that they have collected through the managing agent, then they are required to return the money to avoid being in breach of their statutory obligations as trustees of the fund in which they hold the leaseholders' money. Leaseholders can seek advice from the Leasehold Advisory Service and may also make an application to the First-tier Tribunal to make a determination on their liability to pay.

Leaseholders also have a range of powers to use if they are concerned with the poor performance of a managing agent. They may complain directly to the managing agent, and then to the relevant Government-approved redress scheme to which a managing agent must belong. Furthermore, Section 24 of the Landlord and Tenant Act 1987 gives the appropriate tribunal the power to appoint a manager to take over management where there has been a significant failure by a previous managing agent or landlord.

The Government is committed to raising professionalism and standards amongst managing agents, protecting consumers while defending the reputation of good agents from the actions of rogue operatives. We therefore welcome the ongoing work being undertaken by the sector itself to raise professionalism and standards including on codes of practice for property agents. We will continue to work with industry on improving best practice.