| Previous Section | Index | Home Page |
Mr. Ashby: The Bill is extremely important for leaseholders on low incomes, such as pensioners, who are being intimidated. It may not matter to young yuppies earning a lot of money, with properties with 999-year leases, but it means a lot to pensioners on fixed low incomes. The fee could seem extremely high to them.
Mr. Raynsford: The hon. Gentleman is absolutely right. It is precisely leaseholders on middle to low incomes who are most likely to be intimidated and most likely to decline to use a leasehold valuation tribunal if they know that it will cost £500, because that sum might be beyond their means.
The Minister may say that the charge relates to service charges that could involve several hundred pounds and that it is therefore worth it, but pensioners budgeting on a tight income and worried about an increase in service charges from, say, £600 to £750 might consider the possible saving of £150 not to be worth arguing about if they must pay £500 in fees to take the case to a leasehold valuation tribunal. Why should they have to pay that fee? Why should not they be able to get affordable justice, given that tribunals normally operate on the principle that people should have access to justice and should not be deterred by a lack of means?
The Minister argued that the fee could be reimbursed if the leasehold valuation tribunal decided that the applicant had a meritorious case and the landlord did not. That might apply in some cases, but no one on a low income who was worried about whether he or she could afford the £500 would take the risk. If such people are worried that they cannot pay, they will not be reassured by the possibility--it is a mere possibility--that, if they are successful, the leasehold valuation tribunal may decide that the fee should be reimbursed.
The Government's proposal is extremely dangerous. It threatens the basis of what we argued for in Committee and thought the Government had accepted--that people on modest incomes should have access to justice without being deterred by the cost. Once again, it raises the spectre of leaseholders intimidated by unscrupulous rogue landlords being unable to get effective redress.
By linking the fees to those charged in a county court, Lords amendment No. 102 provides the Government with a modest fee. Although it is higher than we would want, the amendment limits it to a figure that would be, in almost every case, affordable. Moreover, it makes a proper connection between the fees charged in a leasehold valuation tribunal and those charged in a county court, so there is no possibility of inconsistency in the cost of justice between the two. The amendment passed by the House of Lords was important, as it incorporates the principle of affordable justice, and it deserves to be retained in the Bill.
The Government have been engaged in a retreat. Originally, they proposed large fees; they now propose slightly less onerous fees, but they still seek to impose fees that will deter some people from obtaining justice. They are making a dangerous move, which cuts across the principle that people should have access to justice without having to pay fees through tribunals. Their amendments should therefore be resisted, and I invite my hon. Friends to support Lords amendment No. 102, if necessary, in the Division Lobby.
Sir John Hunt (Ravensbourne):
The hon. Member for Greenwich (Mr. Raynsford) referred to a "Government retreat". I would prefer to describe it as a sensible concession in response to concerns expressed by hon. Members here and in another place. I suppose that the nature of compromises means that they do not and cannot fully satisfy either side, but I am reasonably happy with the solution that my hon. Friend the Minister has put forward this afternoon in the form of amendment (a).
Originally, there were great fears that fees of £2,000 a day would be imposed. That would have inhibited people from going to leasehold valuation tribunals and would have undermined the point and purpose of such tribunals, which have deservedly been given a warm welcome by leaseholders throughout the country. I welcome the fact that the Government drew back from their original intention to impose full cost-basis fees.
The Government's concession reminds us of the useful role that the other place can play in matters of this kind. Without the debate to which the hon. Member for Greenwich referred, I doubt whether the Government would have made that compromise. I am sure that the concession will be given a qualified welcome by many leaseholders who look at these matters sensibly and realistically. They will not necessarily oppose the principle of levying fees provided that they are moderate and sensible. In many cases, £500 a day would be shared by several leaseholders taking a single case to a tribunal, so the sum would not be punitive.
The concession will be given a qualified welcome by my constituents, such as those who live on the Fair Acres estate, who have been subjected to a great deal of anxiety and harassment by their landlords over the years. I shall therefore support the Government in the Lobby tonight.
Mrs. Maddock:
Amendment No. 102 is a classic case of giving with one hand and taking away with the other. We have seen that happen in Committee and throughout the Bill's proceedings in another place.
All hon. Members welcome the fact that leasehold valuation tribunals will assist leaseholders if they have severe problems. However, the tribunals will be of absolutely no use to many people if the cost is too high. In particular, I am concerned about elderly people. They worry about money and the hassle of going to the tribunal. If they are worried about whether they can afford to do so, they will not go to the tribunal.
The matter was extensively discussed in another place and I concur entirely with the comments of my noble Friend Baroness Hamwee on this matter. We are talking about access to justice--free access to justice. The Government have retreated on this matter: there will not be free access to justice, as we all thought at the beginning--there will be costs.
The Government's amendments give Ministers the power to change the limit, although they are trying to convince us that it is £500. That is totally unacceptable. I concur with what was decided in another place. I fully support amendment No. 102, as passed in another place.
Mr. Ashby:
The debate has reminded me of something that happened to me some years ago when I was successfully demolishing a prosecution case. The judge was getting more and more irate as he saw the case disappearing and he said to me, "Do you know how much it costs per minute to run this court?" I replied, "I agree that it costs a large amount of money, but what price justice?" Today, we are dealing with justice; we are dealing with something that the Government have recognised and acted on, to their enormous credit.
The Government have appreciated that people go to the London auction houses and see freeholds on 999-year leases being auctioned. We are not talking about the great estates or the decent people--we are talking about people who are out to make a fast buck, about the rip-off merchants. It is no good talking about the sanctity of contracts, about people agreeing that they had a 999-year lease and about people being subject to a contract that they are trying to break. We are talking about rip-off merchants who go out and buy freeholds and then see how much they and their successors can rip off the leaseholder in the following 999 years. I am fundamentally opposed to the whole system, but that is not what we are debating today.
I shall explain to my hon. Friend the Minister why I shall support him in the Lobby today, but I want him to understand what he needs to do in terms of regulation. I declare an interest because I shall talk about my personal case and what I am going to do. I want my hon. Friend to work his regulations so that I can do the best thing possible in my case. That is the best way that I can illustrate what I believe should be done.
My property was sold off to some rip-off merchants, who formed a company called Raleigh Estates, which is really run by a firm of surveyors called Wallakers--
I suspect that it owns a number of properties. It purchased a 999-year lease on a small block of four flats. I am incensed by this behaviour, not because I mind--I earn enough money to pay the insurance--but because it is ripping people off. I loathe being ripped off.
I know that individual flats can be insured for about £180 a year, but that Wallakers has gone to great lengths to ensure that the insurance costs in excess of £390 a year. The terms of the lease say that Wallakers must nominate the insurers and that it is the agent. I believe that the Monopolies and Mergers Commission should look at this matter. There is a tie-up between the major insurance companies and companies such as Wallakers.
The insurance companies do not receive the money direct--they go through Wallakers, and Wallakers gets 15 per cent. I know that 15 per cent. of £180 is not very much, but 15 per cent. of £390 is a good deal more. It is in the interests of the rip-off merchants, such as Wallakers, to get the highest possible insurance they can--they rip us off so that they can get the highest possible return. We have to do something about this.
There are only four flats in my block. One of the tenants is a young computer man and he can afford it. However, one of the tenants is an old-age pensioner. We tried to buy the freehold and had an enormous number of problems. Wallakers puts in every impediment that it can--it does not reply to letters. I have instructed solicitors in this regard, and they cannot get anywhere. Time and time again, we are getting absolutely nowhere. We are all fed up.
The solution is to take the management out of the hands of Wallakers--and as quickly as possible. It will be left with £15 a year and it will have to decide whether it is worth it. We will say, "You can stuff it, Wallakers, we will carry on with the management. You can just get your £15 a year." That is what we want to do.
I want us to get the regulations right. I accept that we must have a limit of £500. The Treasury is giving Departments absolute hell, and I accept that we must have some sort of compromise. Hon. Members have to remember that, in the case that I am talking about, there are not 200 flats--if there are 200 flats, it will be only £5 or £10 a person--but only four, and it costs a lot more.
I hope that the regulations will cover not only the cost of what we are trying to do but the number of applicants. I hope that there can be a scale of fees that will take those factors into account. One should be able to go swiftly, quickly and cheaply before the tribunal. I should like the management to be in my hands--I would get three quotes from insurance companies and I would not charge 15 per cent. There are only four of us and I shall get the others to pay a direct debit to the insurance company and away we will go. There will be no problems at all and no one will be ripped off.
| Next Section
| Index | Home Page |