25 Pearman Street

London SE1 7RB

8 March 07

Dear Mr Hook

RE: Communities and Local Government Committee.

 

I am writing to you with general observations about Leaseholders, who have Local Authority Landlords that are responsible for the maintenance and repair of individual properties and the Estates on which Leasehold property is situated. Please provide copies of this letter to your Committee members.

 

Public Housing Authorities

The obligations and role of public Housing Authorities are far more extensive than the obligations between Landlord Tenant under a private commercial contract. Major works that are beneficial to the general public are often carried out and charged to the Leaseholder. For example Estate and Block security works which are intended to assist police, save police time and to deal with anti-social behaviour have been charged to lessees. Environmental improvements that are part of large-scale plans for public regeneration are likewise charged to lessees. On large estates Local Authorities maintain public roads, spaces and gardens. The decent Homes policy is an example of Major works, which were planned and funded on the instruction of central government and where there was no real consultation with leaseholders. In fact many Local Authorities are currently applying for dispensation from the entire Section 20 consultation.

In regard to annual services, there are many items provided such as translation of documents into foreign languages and numerous questionnaires on ethnicity, equality and household details which may be considered of public benefit. Although these services could legitimately be funded by the Tax Payer as part of public Housing policy, they would not normally be considered part of normal services between Landlord and Tenant. Yet Leaseholders are required to pay for them.

 

Efficiency

There are approximately 400 Local Authorities in England and Wales, which administer Housing stock. Although lessees are generally obliged under their leases to contribute to these administrative costs, the bulk of cost is ultimately borne by the Taxpayer. The larger central London landlords are spending £25-30 million each on administration before any actual services are provided. Nationally this will be equivalent to a cost in the order of £10 billion merely to administer public housing. There are more public sector employees working in housing administration than work for Lloyds Bank and Barclays Bank and RBS combined. Leaseholders, who take these matters to the LVT are assisting the Government and the Taxpayer in helping to reduce public waste. This fact gets scant recognition. They face an arduous task and great resistance from their Landlords, who wish to protect the jobs of Local Council employees. Your Committee could set objective standards of administrative efficiency in terms of man-hours per dwelling etc.

 

Effectiveness and Cost-effectiveness

Many of the government building programmes are totally ineffective. Play grounds are renovated at great expense and instantly destroyed. Security works fail to deal effectively with anti-social behaviour. A serious policy of eviction would be considered socially unacceptable and I do not advocate such a policy. The sad truth is that many problems on estates are insoluble.

However, once a programme of public expenditure is budgeted for, expense takes place on a "Use it or Lose it" basis. Any reduction in expense would lead to a reduction in the power of the administrators who spend Tax Payers' money. The bureaucrats in Local government who make a living from administering these things are directly threatened by any assertion that these items are not effective of not cost-effective. They have every personal motive to exaggerate the importance and benefit of what they do, whereas Leaseholders who pay the cost of these things wish to see cost-effective and worthwhile expenditure. Leaseholders need to be defended against the excessive amount of public funds currently being expended on Local Authority Housing. The burden of proof at LVT is heavily weighed against the Leaseholder and it is a huge inconvenience and expense for lessees to take these matters to the Tribunals. The Tribunals, which are low level courts, are also reluctant to meddle in political matters. It is therefore necessary for parliament and politicians to put in place a protection for leaseholders.

 

Promoting Social Diversity

The government claims that it wants to promote socially diverse occupation on Estates and that it wants "middle class" homes built on Local Authority land. However, at the present time they are driving many right-to-buy owner-occupiers to the verge of forfeiture with their current expenditure policies. These people have simply tried to put aside a little bit of capital by investing in their own homes. They take pride in their estates, which are often challenging social environments. Frankly they may be described as "the salt of the earth".

If the government wants to transform estates, it is essential to start by protecting property values from politically inspired expenditure programmes. All that is being achieved at the moment is a severe undermining of re-sale values. In these circumstances, Local Authority Estates cannot be transformed; they will remain ghettos that are shunned by any ordinary property owner except high risk taking buy-to-let Landlords. The fact that Local Authority property generally fails to sell easily in the open market is testimony to the persistent failure of government renewal policies.

 

Yours Sincerely

 

Mr Paul Palley