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Standing Committee Debates

Draft Mobile Homes Act 1983 (Amendment of Schedule 1) (England) Order 2006

The Committee consisted of the following Members:

Chairman: Mr. Mike Hancock
Bellingham, Mr. Henry (North-West Norfolk) (Con)
Blackman, Liz (Erewash) (Lab)
Byers, Mr. Stephen (North Tyneside) (Lab)
Dobbin, Jim (Heywood and Middleton) (Lab/Co-op)
Foster, Michael Jabez (Hastings and Rye) (Lab)
Fraser, Mr. Christopher (South-West Norfolk) (Con)
Kaufman, Sir Gerald (Manchester, Gorton) (Lab)
Laing, Mrs. Eleanor (Epping Forest) (Con)
Moffatt, Laura (Crawley) (Lab)
Mole, Chris (Ipswich) (Lab)
Munn, Meg (Parliamentary Under-Secretary of State for Communities and Local Government)
Raynsford, Mr. Nick (Greenwich and Woolwich) (Lab)
Rogerson, Mr. Dan (North Cornwall) (LD)
Ruddock, Joan (Lewisham, Deptford) (Lab)
Stunell, Andrew (Hazel Grove) (LD)
Vaizey, Mr. Edward (Wantage) (Con)
Winterton, Ann (Congleton) (Con)
Frank Cranmer, Committee Clerk
† attended the Committee

Ninth Standing Committee on Delegated Legislation

Thursday 22 June 2006

[Mr. Mike Hancock in the Chair]

Draft Mobile Homes Act 1983 (Amendment of Schedule 1) (England) Order 2006

2.30 pm
The Chairman: As the weather is hot, hon. Members may take their jackets off if they so wish.
The Parliamentary Under-Secretary of State for Communities and Local Government (Meg Munn): I beg to move,
That the Committee has considered the draft Mobile Homes Act 1983 (Amendment of Schedule 1) (England) Order 2006.
The order was laid before the House on 24 May 2006. It introduces new terms into the agreements—the written statement—of all mobile home occupiers. If approved by this House and the other place, the order will come into effect on 1 October 2006. The objective of the proposed changes is to offer greater protection for residents of park homes—the industry name for residential caravans—and to provide a base for a positive future for the industry.
The Housing Act 2004 gave the Secretary of State the power to change terms implied in the Mobile Homes Act 1983. Such terms are contractual terms that are implied by law into the agreement between a resident and a park owner. They permit the resident to station a mobile home on the park and to occupy it as their main residence. As existing agreements are of infinite duration, this, the first use of the power under the Act, will imply terms into existing as well as future agreements and will amend the terms already implied into existing agreements. Future exercises of the power will not affect existing agreements.
This is another milestone in the Department for Communities and Local Government reform of the park home industry, which has been ongoing since the park home working party was set up in 1998. Its aim was to consider the operation of the existing controls on park homes and to make recommendations on what changes, if any, were desirable to achieve a fair and workable balance between the needs and interests of occupiers and park owners.
In the Department for Transport, Local Government and the Regions 2001 paper, “Government Response to the Recommendations of the Park Homes Working Party”—I note that my right hon. Friend the Member for Greenwich and Woolwich (Mr. Raynsford), who was the Minister for Housing and Planning at the time, is a member of this Committee—an in-principle commitment was made to take forward many of the working party’s recommendations. Of the 30 recommendations, 25 were accepted, with two relating to the written statement and implied terms.
The work has been supplemented by numerous consultations and research, which have formed the basis for this work. In July 2004, we issued a consultation paper entitled “Park Home Statutory Instruments”, which forms the basis for the order. Unsurprisingly, there are areas in which we have advanced policy in the light of expectations from both sides of the industry, and we are grateful for the continued constructive comments from stakeholders to ensure that the order is successfully implemented.
The order makes a number of additions to the implied terms, which are outlined on the fact sheet before the Committee. Rather than giving a detailed breakdown of all the individual provisions, I propose to deal specifically with any queries that hon. Members raise about the order. However, I will touch on a few of the implied terms that we are introducing.
The first issue is quiet enjoyment and right of entry to the pitch. Proposed new paragraph 11 of schedule 1 to the 1983 Act gives residents the right to
“quiet enjoyment of the...home.”
One common way of harassing residents is to visit them late at night, often for spurious reasons. Proposed new paragraphs 12 to 15 restrict owners’ right of entry to the pitch to working hours, except in the case of emergencies. That should reduce the chances of out-of-hours harassment and, if it does occur, make it easier for action to be taken. The measure categorically states that there is no right of entry to the home for park owners.
Another key amendment is the introduction of a mechanism, outlined in proposed new paragraphs 16 to 20, for reviewing the pitch fee. In reviewing the pitch fee, the owner must have regard to any sums expended for the benefit of the residents and on which they have been consulted; the effect of any new Government legislation—there is an exception in respect of commission—and any decrease in the amenity of the site. A presumption has been introduced that the pitch fee will be changed only by a percentage equivalent to any change in the retail prices index since the last review date. That provides additional protection for residents.
Most importantly, we make it a requirement that the review is a negotiation, rather than a demand. The provisions also ensure that residents continue to pay the current pitch fee until a new level is agreed.
One other amendment is the introduction of criteria under which a park owner must recognise a resident association and consult with it under the 1983 Act. New paragraph 28 is similar to provisions in the leasehold sector, but has a lower threshold for membership due to the difference between the sectors. I shall be happy to answer any questions or queries that the Committee has, and I commend the order to the Committee.
2.35 pm
Mrs. Eleanor Laing (Epping Forest) (Con): I thank the Minister for bringing forward the legislation, which is necessary. In principle, I and my hon. Friends certainly do not oppose it. The area of law that governs the relationship between the owner of a mobile home park and the owners of the homes sited there is out of date and in need of reform.
I know that there has been a very long and detailed consultation on the matter, and I am sure that the Minister is introducing the order with confidence. There is much in it that we welcome, but I have some considerable concerns. Unfortunately, as hon. Members know, although we have a chance to debate the matter this afternoon, there is no opportunity to amend the order, because of the procedure by which it has been brought before the House. That is unfortunate because there are some small areas in the statutory instrument that would be better if they were slightly amended.
I appreciate that the Minister does not normally deal with the subject concerned. [Interruption.] She does now. Let me wind back a bit: I appreciate that the Minister is new to the subject. She and I have sat in this and other Committee Rooms for an uncountable number of hours debating and considering matters regarding women and equality, the work-life balance, employment regulations and so on. Normally, we find ourselves in amazing agreement.
I apologise for the absence of my hon. Friend the Member for Surrey Heath (Michael Gove), who normally speaks for the Opposition on housing matters. He is unable to be here, but I am extremely pleased to be able to deal with the matter because it is of great importance in my constituency. I am glad that the Minister recognises that.
The current legislation is certainly unsatisfactory and there is no doubt that some park home owners are abusing their dominant position—to put it politely. Some of the stories that I have heard and incidents that I have experienced through my constituents are nothing short of appalling. We imagine that in our supposedly civilised society in the early 21st century people do not behave like a caricature of a Victorian landlord, but in this instance, they do.
Normally, when I stand up on the Opposition side of the Committee to discuss proposed Government legislation, my usual chorus is: “We do not need all this red tape; it is not for the Government to interfere in every aspect of every citizen’s life”. This afternoon, I shall say exactly the opposite because in this area, the person on one side of a contractual agreement has enormous financial and practical power, and the person on the other side of the legal agreement—the owner of a home on a park—has no power whatever and considerably fewer legal rights than the owner or tenant of any other type of property. The law does not recognise park homes as property. Let us face it: the legal position is that they are not heritable property but moveable property. Therefore, the conditions that apply to them and their position under the law are completely different, but that does not mean that the people who live in them do not deserve the same recognition under the law and the same rights as owners and tenants of other types of home in Britain today.
I have several concerns that I must express to the Minister. I appreciate that we can do nothing to amend the order this afternoon, but she and her Department will undoubtedly keep this difficult area of law under consideration, and perhaps the matters that we discuss this afternoon will be taken into consideration in future reviews of the law. I am sad to note, however, that it has taken a long time, under all Governments—this is not a party political matter—for us to get this far with the legislation. Although I welcome the order, I hope that it will not take so long for further improvements to be made, because they are necessary.
I am concerned about some of the details. The introduction in article 2 of the court’s ability to make a judgment on the reasonableness of the behaviour of the park owner is a good development, which we particularly welcome. However, I am concerned that the introduction, also in article 2, of the word “forthwith” instead of “at the end” of a contractual period does not give the occupier enough time to deal with the matters that they are required to deal with. It is of course necessary—the order does this—to tighten the conditions that the owner of a park can impose on the owner of a park home and the conditions on the money that he can extract, but the order simply does not go far enough.
I am indebted to various bodies for giving me specific information on these matters and I shall mention them all at once for the sake of brevity. They are extremely good organisations, without whose vigilant action over many years the position of the owners of park homes would be much worse. The bodies are the Park Home Residents Action Alliance, the National Association for Park Home Residents and the Independent Park Home Advisory Service. I add to that Mrs. Maggie Radcliffe of Breach Barns park, which happens to be in my constituency. Maggie Radcliffe has done an immense amount, speaking on behalf of her friends and neighbours, to ensure that I and other Members of Parliament know what is happening in these parks. I know that my hon. Friend the Member for Wantage (Mr. Vaizey) will have similar instances to recall.
The National Association for Park Home Residents has raised with me what I agree is a very good point. Paragraph 8 of schedule 1 to the 1983 Act deals with the sale of mobile homes to persons approved by the park owner. The association says:
“Current legislation allows a Home Owner to sell their home on the Park and to assign the Agreement to a person approved by the Park Owner.”
It adds that such agreements should be binding on the new home owner and the park owner. In practice, however, residents associations find that park owners—Mrs. Maggie Radcliffe has also pointed this out to me, using particular instances—flout the law by issuing new agreements and raising pitch fees above the level paid by the outgoing resident.
Article 2(4)(a) tightens matters up considerably, and I thank the Minister for that. It says:
“The owner may not give his approval subject to conditions.”
However, it would be much stronger if, as the association suggests, it said:
“The Park Owner shall, without Conditions, give his approval to an assignment and shall not issue a new Agreement or increase the Pitch Fee”.
Indeed, I suggest that the wording should be, “shall not unreasonably increase the Pitch Fee”.
It is a poor situation when the law does not protect the weak party to an agreement from the strong, and indeed often bullying, party. I use the word “bullying” advisedly, and I would not habitually use it, because it is very strong to say that someone is acting like a bully. However, the cases that I have seen prove beyond doubt that people are doing so. Indeed, that has been proved in court, and I shall come to that in a moment.
I welcome the fact new paragraph 11 to the schedule and subsequent new paragraphs give the home owner the right to “quiet enjoyment” and that new paragraph 10 introduces a better balance between the site occupier and the home owner. However, the only way we can apparently tackle this massive injustice is to pass a law that can be enforced only through reference to bringing a court action. That, of course, is the only way in which the law can be enforced. I do not expect the Minister to come up with a miraculous answer on this point, but as we are all aware, there is an enormous imbalance between the financial resources of someone who lives in a park home and those of the person who owns the site. Bringing a court action is therefore not always feasible or realistic, and someone who makes an enormous profit from bullying his tenants—I never thought I would hear myself say something like that, but it is true in this case—can defend a court action for months and years. Meanwhile, people with small financial resources will be made miserable for years, not just months.
The Minister mentioned the provisions on changes to the pitch fee and other such regulations. I entirely welcome those provisions, although with the proviso that I have just made.
I would like the Minister to consider two other points. It appears that, for the purposes of electing a residents’ association, the law gives voting rights to only one person in each mobile home. The Minister and I usually discuss women’s rights and equality, and I am not surprised to find that the issue also comes into this afternoon’s discussion, as it does in so many areas of legislation. If only one person in each home is allowed voting rights—it will be the stronger person, which is usually, but not necessarily, the man—the woman’s rights will, again, be put aside. I simply ask the Minister to consider that. Is it right that only one person should be given voting rights?
The other point is very difficult. Residents’ right to have an unhindered sale process is not entrenched in the legislation before us. The Park Home Residents Action Alliance has done research on the issue. It says that, at first glance, the amendment does not, as I said, allow the park home owner unreasonably to withhold his consent to the sale of a mobile home by one person to another. However, the alliance continues:
“this amendment appears to be an improvement, but in practice it has created a gaping loophole which the unscrupulous park owners are already using to prevent homeowners from selling and could have the effect, if taken to the extreme, of preventing every park homeowner in the country from selling their homes except to the park owner for whatever price he is prepared to pay.”
I raise the issue because I know of such an instance in my constituency, although I shall not mention the exact instance, in case it becomes sub judice at some point, in which case it would have been quite wrong for me to pre-empt matters by mentioning the case here.
Under the new law, the home owner must undertake that procedure each time he has a prospective buyer, so the process could conceivably go on for years, until the home owner finally has to accept the park owner’s offer to buy the mobile home—usually at a much reduced price. In the instance to which I referred, the price offered by the park owner is about 25 per cent. of the real value of the mobile home, which is blatantly unfair. I simply want to ensure that the Minister is aware of that.
Park Home Legal Services Ltd. has drawn to my attention the fact that, although existing legislation, as amended by the Housing Act 2004, which this statutory instrument amends, provides a procedure for the home owner to serve on the park owner a notice to the effect that they are desirous of selling their home to another person, with that notice, they must seek the park owner’s approval of the sale to the stated person, and the park owner’s permission must not be unreasonably withheld. On the face of it, the Committee will undoubtedly think that it is a good piece of legislation. However, that instance is similar to the one that I have just outlined, in which the park owner upon receipt of the notice has 28 days in which to respond.
The Government clearly believe that introducing the order is enough to prevent abuse by park owners blocking sales. However, because the legislation requires an express commitment from the park owner, it creates a new problem. The point at which a park owner communicates with a prospective purchaser to consider approval of that person prior to the sale of the mobile home will, as I have outlined, provide an opportunity for the abuse to continue.
Again, I am indebted to Mr. Graham Watts for bringing forward that example. It is not a legal reasoning that law students have thought out for the sake of challenging the Government, and I am not trying to make any party political points whatever. That is not at all my purpose, and I think the Minister appreciates that. I am not criticising the Government, as all Governments have been remiss in not dealing with the matter. I am drawing the Minister’s attention to the loopholes that still exist.
I am particularly concerned about a further loophole. New paragraph 22(b)(iii) states that the park owner has to provide evidence to support “any other charges” or costs. “Other charges” are also mentioned in new paragraph 26(5). It has been suggested that there are no other charges, but if those provisions remain in the statutory instrument, they will open the way for a park owner to impose other charges.
Believe it or not, park owners can impose other charges in clever ways. I have a particular example, and in this instance I am going to mention names. The park owner in question is a Mr. Maurice Sines. Other members of the Committee may have come across him. He is the owner of many park homes throughout the country, but the one that I know best is Breach Barns in my constituency.
A few months ago, Mr. Sines’s agent wrote to the Breach Barns allotment association explaining that the price of allotments was to increase from about £25 a year to about £25 a month—an enormous fee. Mr Sines was not expecting but demanding that each home owner pay £360 a year instead of about £25 for the use of their allotment. He also imposed a deadline of 28 days, during which time all greenhouses and other possessions had to be removed. If the £360 per year were not paid, and the greenhouses were not removed from the allotments within those 28 days, he threatened to take the right, under the law, to remove all the greenhouses and other possessions from the allotments. That is what he did. He took back the allotments and either sold or redeveloped them. So the people on the park have lost their allotments and everything that was on them.
I would like the Minister to note that that is a way in which other charges most certainly can be imposed. Although the Government might believe that the law is now tightly drawn so that such charges cannot be imposed, sadly, it is not the case.
I do not mention lightly the name of Mr. Sines and his company, or his and his employees’ behaviour. He did not have the courtesy to reply to a letter that I wrote to him, among others, on 27 January. I do not hesitate to mention his name. I am not defaming him because in October last year Oxford county court ordered him to pay £75,000 compensation for bullying and intimidation, in a particular case brought against him by a park home residents association.
The accusations that I realise that I am making this afternoon are not out of order and not made lightly. That man has already been found by a court to have acted in an intimidating way, but of course the court action has no effect on his future behaviour. He simply pays £75,000, goes on to make more money to pay more fines and continues intimidating other park home residents in other parts of the country, because of course the case brought in Oxford refers only to Oxford.
That is one example only of the behaviour of some park home owners. Of course, I am bound to say that many park home owners throughout the country will welcome this afternoon’s order because they behave responsibly and reasonably. They will have no objection to the tightening of the law, which the order does, because they do not wish to intimidate their tenants. Sadly, that is not the case with Mr. Sines.
Finally, I am concerned about the provisions for the pitch fee review. Unfortunately, the balance is wrong and depends on a finite period for the pitch fee review, because otherwise a dispute could continue indefinitely. That is quite reasonable. However, a park owner can deliberately do nothing knowing that over time the number of residents in the dispute will decrease as people will eventually leave, die or give in. Although the park owner can bring a case, the home owner cannot. The resident is not asking the park owner to do anything, but just wants to avoid having to pay an unjustified sum. A person cannot bring a negative court action. The exact terms of the provision on pitch fee review will not work as well as the Government hope.
I have taken up a lot of the Committee’s time this afternoon. I have not done that deliberately, but it is absolutely necessary that we put on the record the scandalous way in which some people are abusing their power. Had this been a year ago, I would have been urging the Government to do something about it. I appreciate that they are doing something about it now by bringing forward an amendment to the Housing Act and, as far as it goes, I welcome it. However, I hope that the Minister will take note of my reservations and those of the representatives of people who live in park homes because they deserve to be treated better not only by those whose tenants they are, but by the law that professes to protect their position.
3.5 pm
Mr. Nick Raynsford (Greenwich and Woolwich) (Lab): I shall be brief. I congratulate my hon. Friend the Minister on introducing the order. It is welcome and will bring real benefits to residents in park homes who have, as we all know, suffered a disproportionate number of problems and disadvantages from the abuse exercised by some park home owners.
It is wrong to pillory all park home owners. Some are responsible and behave well, but there have been too many cases of abuse and too many problems, which is why the working party to which my hon. Friend referred was set up after the 1997 general election to look into such issues and to come forward with recommendations to give proper protection to park home residents while, at the same time, ensuring that reputable and responsible park home owners continue to ply their trade in a proper way.
The order gives effect to a number of the working party’s recommendations and I welcome it wholeheartedly. Because of the history of abuse and the imbalance of power between park home residents and park home owners, it is not surprising that some residents are still nervous and have reservations about whether the measure will give them all the safeguards that they are seeking. It is not surprising therefore that we have received some representations about it.
I have received a letter from the National Association of Park Home Residents. My understanding of its worries is that they probably are not as great as the residents believe, but I would welcome my hon. Friend’s assurance that, on the key issues such as protection against unreasonable increases in pitch fees, intrusive visits by owners, harassment of residents and threats to move park home residents to unsuitable sites, the order gives the safeguards that the Government intend and that the anxieties expressed by the association are not ones that it should hold in practice. Those fears should be allayed.
I welcome the order and look forward to my hon. Friend’s response.
3.8 pm
Mr. Dan Rogerson (North Cornwall) (LD): I was delighted to hear the lengthy and thorough contribution by the hon. Member for Epping Forest (Mrs. Laing). She claimed at the beginning of her speech not usually to speak for her party on such issues. Well, she has certainly ensured that she is acquainted with them, especially in light of the experience of her constituents. Many members of the Committee will have had the similar experience of being approached by constituents in particularly difficult circumstances that were brought on by unscrupulous site owners. My party welcomes the order and hopes that it will even up the balance a little more between the occupier and the site owner.
In all such legislation, a balance must be struck that protects the rights of the site owner in respect of people who are causing problems, whether as residents or those who fail to maintain the property that they have purchased. Fundamentally, the problems in the majority of cases have been caused by unscrupulous site owners, and I agree with the comments that have been made about such matters.
I, too, have received the correspondence that other hon. Members have received. I was particularly interested in the correspondence from Park Home Legal Services Ltd., which the hon. Lady referred to. This is a key point and I would welcome reassurance from the Minister on the subject of the intimidation of potential buyers or any efforts by site owners to put people off, which artificially depress the price and therefore affect the substantial investment made by occupiers.
The occupiers on many such sites—I think this is often true of those in my constituency—are retired couples or individuals who have tried to downsize. It is a useful safety valve with respect to overall housing need, particularly in rural areas, if some couples are allowed to move out of the large property that they have occupied and put it back on the market for other people. Therefore, anything that we can do to encourage them to have confidence in making that move should be welcomed.
I have one or two other points to make on which I would welcome the Minister’s comments. The word “detrimental” is used in the context of site owners’ right to take action against an occupier. Can the Minister provide any interpretation of or reassurance on article 2(3), which refers to
“paragraph 6 (termination by the owner because of mobile home’s detrimental effect on amenity of the site due to its condition)”?
In consultation on the provision, some of my hon. Friends have raised the possibility of clearer terminology on, for instance, dilapidation or the unsafe nature of the property to make it quite clear what is meant by a detrimental effect on the amenity of the site. A related matter is that the Government have been reviewing the 10 per cent. statutory commission on sale that goes to the site owner. I wonder whether that review is coming to any conclusions; the matters are connected.
I would be interested to hear how the Minister feels that new paragraphs 22 to 25, which strengthen the ability of residents to act if site owners do not maintain the site in a proper and acceptable condition, will even up the balance and ensure that the issue is not only whether the occupiers maintain their property in a suitable condition, but whether the site owners meet their side of the bargain and ensure that roads and the general amenity of the site are kept to a proper standard.
Has the Department given any thought to the sort of consultation that is to take place with residents’ associations on action to be taken on the site with respect to charges or site alterations? On a related point—you might rule me out of order on this, Mr. Hancock—the issue has been raised of park homes being transferred from council tax band A to band B.
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