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9.35 pm
Dr. Iddon: It is a privilege to serve as a Member of Parliament and to contribute to proceedings on the Bill. I should like to place on record my thanks to both Ministers for listening to those of us who fought a few battles during the passage of the Bill.
I became interested in the Bill because of my concern about nominated insurance. Many people in my constituency wrote to me, upset at being forced by the Compton Group to get insurance with Axa Insurance. Provisions on the issue were not included in the draft Bill that was originally submitted to the House. The Ministers
listened to us and we now have a Bill that, when enacted, will make nominated insurance companies illegal. I thank both my hon. Friends for listening to us and bringing about that change.A big chunk of the Bill deals with the introduction of commonhold and the right to manage. The 100 per cent. rule will be tested; I wish commonhold well, even with that rule. If it does not work, we can return to the subject. However, I hope that commonhold works with the 100 per cent. rule because as the Parliamentary Secretary has said more than once, it will simplify things tremendously.
Leasehold remains as a form of tenure, although I believe that the sun will set on it one day. We wanted a sunset clause on that in the Bill, but did not get one. Marriage value, a fairly recent concept, is still present, but I am sure that we will return to it. Forfeiture has been the big battle for me in recent weeks. I thank the Ministers for listening to us in our meetings with them.
Despite my mild opposition this evening, we have made much progress on forfeiture. It will be much more difficult for freeholders and landlords to take people down that route, and I am grateful for that. However, I urge my hon. Friends to look at the figure of £350, which is not a lot in London. Many people in London are subjected to forfeiture for sums that that figure would not catch.
Finally, I am sorry that we were not allowed to discuss compensation tonight. I do not blame the Chair, who obviously made the right decision. If we had gone into the Lobby, there would have been considerable support. I thank the Minister for listening to what we said about compensation. Finally, I urge her to submit a draft Bill to the House in the next Session. I look forward to its introduction, and hope that I can see it through the House during my time here.
9.38 pm
Mr. Sanders: The high hopes of many leaseholders have probably not been met by the Bill although, importantly, commonhold and the right to manage have both been established. In some respects, rights to enfranchise have been advanced. However, the Bill will be judged on what it omits, not what it includes.
The Campaign for the Abolition of Residential Leasehold wanted five things to be included in the Bill: the introduction of commonhold, which it got; the abolition of residential leasehold, which it did not get; the automatic right to transfer from leasehold to commonhold, which it did not get; the transfer of tenure at a fair price, which is not covered by the Bill; and special measures for people unable to transfer, which are not in the Bill. CARL therefore achieved only one of its five aims. Liberal Democrat Members did better with our aims. While we failed to achieve the abolition of marriage value, forfeiture and the 100 per cent. consent to commonhold, we got the right for leaseholders to choose their insurance and recognition of estate management schemes; two out of five is not bad.
Nevertheless, for tens of thousands of leaseholders, the prospect of enfranchisement is no closer. We wish commonhold well. We have said throughout proceedings on the Bill that we support the concept. We want it to succeed and we hope that it will. We also hope that we can return to some of the unfinished business of the Bill—
marriage value, forfeiture and, later, if our fears are realised, the 100 per cent. consent required for commonhold.Our time in Committee was enjoyable. The proceedings were conducted mostly with good humour and in a non-partisan way, with one or two exceptions. I must state on the record that not once during the passage of the Bill did I fall asleep. Despite the best efforts of some hon. Members, I stayed awake at all times.
I thank the Public Bill Office for its help. That is a resource of the House that is not often mentioned, and the help provided by its staff in preparing amendments is fantastic.
We wish the Bill success. We want more people to take more control over their lives. However, we will need to return to some of the unfinished business, which has been around for more than 100 years.
9.40 pm
Mr. Lepper: I add my appreciation to that already expressed to my two Front-Bench colleagues, despite comments made earlier in the evening. The past couple of weeks have shown the extent to which Back Benchers in all parts of the House can still influence the course and the content of Government policy. Although we may not have influenced the Bill as much as some of us may have wished, it shows that Back Benchers can influence the outcome of debates on important policy issues.
I particularly welcome the right to manage, which the Bill introduces. In my postbag, bad management remains the single biggest leasehold issue that I deal with. I look forward to the draft Bill on forfeiture that was promised by both Ministers for 2003. I also look forward to the results of the consultation that I believe is taking place on an issue that is not part of the Bill: the regulation of managing agents. I thought that it should be part of the Bill, but at least the Government are consulting on it.
The right to manage is one thing, but the next step is to make sure that managing agents, whoever they are employed by, behave in a reasonable, responsible and trustworthy way. I recommend the voluntary scheme operating in the Brighton and Hove city area through the combined efforts of the city council, LEASE, the Brighton, Hove and District Leaseholders Association and the Association of Residential Managing Agents. That model could be adopted throughout the country.
Finally, I place on record two other votes of thanks. The first is to the Brighton, Hove and District Leaseholders Association, which during the passage of the Bill, particularly in Committee, kept many hon. Members better informed than they were before about leasehold. The second is to my right hon. Friend the Minister for Local Government, who for so many years kept leasehold alive as an important policy issue in my party and in the country at large.
9.43 pm
Mr. John Taylor: Before we all drown in self-congratulation, I have a lament that resonates back to Committee. I am old enough to have been a young, newly qualified solicitor in 1967, when the Leasehold Reform Act came in, which first enabled long leaseholders of houses to acquire their freehold reversions. I remember my wise late senior partner saying to me, "Aha! It's a
good idea, but how are they going to work out the price?" He added, "The political community has once again funked the real issue, which is to tell people how much they can expect to pay." I grant that this is an arbitrary consideration, but I remind the House of the old adage, "It is not so important that the law be fair but that it be certain." Most people, including the constituents of the hon. Member for Cleethorpes (Shona McIsaac), cannot afford to take lawyers to the Lands Tribunal to argue about the price. They are entitled to a mechanism to work out what they should pay for their freeholds, so that they can know the price with some certainty and budget for it.Here we are 35 years later and the political community has funked the issue yet again. We have failed our constituents in this regard. [Interruption.] It is not for me but for the Government to resign. People make a great mistake when they think that the market will work the matter out. There is no market and people cannot shop around as there is only one potential seller of the freehold and only one buyer. One cannot go somewhere else as one might do to buy a pair of shoes. There is no market mechanism and people are entitled to assistance from their legislature on establishing a price. We have failed them.
9.46 pm
Shona McIsaac: I was going to start my contribution by saying that the debate had at times been dry and technical, so I am grateful to the hon. Member for Solihull (Mr. Taylor) for yet again livening up our proceedings. I echo what he said: there is not sufficient clarity on how much people have to pay to purchase the freehold of their homes. The introduction of a pricing formula would help people to budget for the future. Indeed, I know of far too many constituents who, on finding out the cost of purchasing their freehold, say "I can't afford it; I'll put it off for a few years, because it is bound to get cheaper." Of course, the same assumption applies to many other purchases: for example, people know that an older car is likely to be cheaper. Often, they do not realise that freehold price will continue to grow as long as they put off the decision.
We must get information to people and introduce some sort of price mechanism that is simple and easy to understand. After all, in spite of the dry and technical nature of some of our debates on the Bill, we are talking about people's homes—the most expensive purchase that most people will ever make. There are 2 million leasehold properties, with an estimated 3 million to 4 million residents. The issue is not esoteric, but affects every constituency in the country. That is why it was vital to introduce a Bill to reform leasehold.
One aspect of the language that has been used in our deliberations is that leaseholders have been called "tenants"—an expression that I have never liked. We are talking about people's homes. They pay mortgages, and as such, they regard themselves as home owners in censuses. Indeed, in any application form that they fill in, perhaps for a bank loan, they will say that they are home owners. We must acknowledge what we sometimes forget in our debates: the passion that people feel for their homes and for owning them.
Back in 2000, I was given leave to introduce a ten-minute Bill. I took the opportunity to make certain demands because, as I said at the time, I wanted to change the law to stop leaseholders being fleeced by
unscrupulous landowners. I focused on families' rights in respect of purchasing their parents' homes after they had passed away, and the right to buy the freehold if the owners chose to extend the lease after it had expired. The Bill covers those matters. Indeed, the measure provides for more than I demanded then. For example, the provisions on insurance will give many people genuine protection in law from scams.The provisions on forfeiture are welcome. In my area, ground rents are low—in some cases, less than £10—and people are threatened with all sorts of penalties if that sum is paid even one or two days late. Threats of forfeiture have been used, and I therefore hope that the de minimis level of £500 means that those people will not be threatened again.
The Bill introduces more clarity about service charges. I have already mentioned inheritance, but the measure includes welcome provisions on enfranchisement and lease extension. I understand that the latter will apply even to people who have already extended their lease. The measure will assist my residents; it is a step forward, and I welcome it.
None the less, I shall continue to campaign for further reform because it was clear in Committee that we are considering a phenomenally complex area of law. We probably could have spent a year trying to sort out the complexities.
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