Orders of the Day — Landlord and Tenant (No. 2) Bill

Part of the debate – in the House of Commons at 5:58 pm on 30th March 1987.

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Photo of Mr Alfred Dubs Mr Alfred Dubs , Battersea 5:58 pm, 30th March 1987

I accept the Minister's answer. It is better to have the necessary clauses added to the Bill in Committee.

I have received strong complaints about the size of sinking funds for repairs and the way in which such funds have been managed. Leaseholders have complained that sometimes proper accounts are not available or indeed no form of accounts is available. There is the ever-repeated complaint that the management of some of the blocks is quite unsatisfactory. Sometimes leaseholders are simply unable to make contact with the freeholder. They may be unable to find the freeholder or sometimes the freeholder is not known. A device is sometimes used wherein there is a head freeholder, then an intermediate leaseholder and then those leaseholders living in the block. The two layers above the leaseholders make it even more difficult for the leaseholders to make contact with the people who own the freehold.

One notorious incident occurred when a small block of flats was bought by a company that paid £800 for the leasehold of each flat. Within weeks the freeholder was offering to sell the leaseholds for more than £6,000 to each of the leaseholders. Sometimes an individual leaseholder has been negotiating to buy the freehold when, in the middle of negotiations, the freeholder has simply decided, unbeknown to the leaseholder, to sell to a property company and has not bothered to tell the leaseholder.

A notorious case in my constituency involved a house which had been converted to three flats. One was empty and the other flats were occupied on leasehold. The empty flat had extremely bad dry rot, but apparently the freeholder had run out of money and could not carry out the repairs. The result was that dry rot was affecting the other flats. The leaseholders were desperate because they were aware that their asset was depreciating day by day, possibly to the point where the building became valueless, but, at the time, there was nothing they could do.

There is also the difficult instance where someone has bought the leasehold and, having moved in, is given, without warning, a hefty repairs bill for a backlog of repairs. It may be argued that in such circumstances the solicitor who carried out the conveyancing should have discovered that problem. Nevertheless, I have received complaints about that.

There have been instances when pensioners, who were ordinary tenants, have been persuaded to safeguard themselves in old age by becoming leaseholders. Once they did so, they discovered they could not afford their repair bills and ended up worse off than if they had remained as tenants. Over and over again one hears the cry that if the only recourse is to go to law, people cannot afford litigation and have doubts as to whether they will be properly covered by legal aid.

I am satisfied that the Bill goes a long way to help to tackle those evils. With this measure the Government are departing from what I regard as their utter free market policy on housing. I welcome this different, somewhat interventionist approach by the Government. It goes against the thrust of Government thinking on other aspects of housing.

I believe that three problems remain which are not adequately dealt with by this measure. They have been referred to in passing by other hon. Members this afternoon. I would like the provision of a full right to buy, provided that a significant number of leaseholders wish to exercise that right. I would prefer that rather than the burden being on the leaseholder to prove that the landlord or freeholder is behaving negligently. That is difficult to prove and may not work in the courts. I would prefer there to be a proper right to buy for leaseholders living in such blocks.

I share the concern expressed by my hon. Friend the Member for Norwood (Mr. Fraser) about what will happen at the end of long leases. What happens in the last few years of a lease when it is impossible to sell that lease to someone else? People are stuck in a property and are seriously worried about what will happen at the end when they must meet the obligations attached to the expiry of that lease. A right to renew a lease would give people some sense of security, would stop properties becoming dilapidated and, philosophically, be on par with the other aspects, especially the limited right to buy, described by the Minister. I urge the Minister to give people the right to renew a lease in the same way as he has given them a limited right to buy.

I am worried about the existence of mixed forms or tenure in blocks—a mixture of private tenants and leaseholders. The safeguards in this legislation apply to blocks that are occupied by long leaseholders and I do not believe that those safeguards will apply equally where there is a mixture of leaseholder and private tenant. Some tenants have been in blocks for a long time. They may be elderly and may not be in a position to convert their tenure to a leasehold if that is what they desire. However, some may wish to do so, and I believe that it would he better if they had a right to buy as well. Whereas leaseholders will now have a right of say in the management of blocks, tenants will not have that right. I am interested in how the Minister will cope with problems of mixed tenure in such blocks. I hope he will consider that problem sympathetically in Committee.

This Bill is a long overdue reform. It will help long leaseholders, but it does not allow the Minister to escape the fact that there is a major housing crisis in London affecting people in other forms of tenure. I wish the Minister would turn his mind to that problem. Nevertheless, I welcome this reform. I welcome the fact that many long leaseholders in my constituency and elsewhere in the country will be able to face their housing prospects more cheerfully when this Bill is on the statute book.