Commonhold

– in the House of Lords at 2:44 pm on 22 November 2005.

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Photo of Baroness Gardner of Parkes Baroness Gardner of Parkes Conservative 2:44, 22 November 2005

asked Her Majesty's Government:

How many commonholds have been registered under the Commonhold and Leasehold Reform Act 2002; and, of these, how many include social housing.

Photo of Lord Evans of Temple Guiting Lord Evans of Temple Guiting Government Whip, Government Whip

My Lords, the commonhold legislation came into force on 27 September 2004. As of 18 November, six commonholds were registered at the Land Registry: five in England and one in Wales. The rate of take-up is extremely disappointing. We are investigating the reasons for the slow start and looking into ways that take-up might be boosted. As part of this exercise, we are considering whether it is necessary to hold a formal review. We will announce the result of our investigations early in the new year.

Photo of Baroness Gardner of Parkes Baroness Gardner of Parkes Conservative

My Lords, I thank the Minister for that reply. It is disappointing because it was anticipated that there would be many thousands of registrations by now. It is almost derisory if it is only five or six. Can the Minister confirm that commonhold was a Labour Party manifesto commitment and that the intention was to empower people to own and control their own homes on a permanent basis, rather than to have a lease which is a depreciating asset?

Photo of Lord Evans of Temple Guiting Lord Evans of Temple Guiting Government Whip, Government Whip

My Lords, the noble Baroness is absolutely correct. It was a Labour Party manifesto commitment, and it had the backing of the Opposition. In fact, it is a piece of legislation that has moved through several Parliaments. The noble Baroness is absolutely correct that it offers people, particularly flat owners, the possibility of permanent ownership of their properties. The Government are absolutely committed to commonhold. We shall investigate why progress is so slow and report back to the House early in the new year.

Photo of Baroness Hanham Baroness Hanham Spokespersons In the Lords, Local Government Affairs & Communities, Spokespersons In the Lords, (Also Shadow Minister for Women & Equality- Not In the Shadow Cabinet)

My Lords, does the Minister recall that when we were discussing the commonhold Bill there was a great deal of inquiry around the fact that the Government were insisting that there should be 100 per cent sign-up within a block before it could become a commonhold? Does he also recall that the strong recommendation from this side of the House was that it should not be more than 80 per cent? If the Government are going to consider a review—indeed, even if they are not—will they consider reviewing the 100 per cent requirement?

Photo of Lord Evans of Temple Guiting Lord Evans of Temple Guiting Government Whip, Government Whip

My Lords, I think we will reconsider every aspect of it. The noble Baroness is absolutely correct to say—and I think it was the noble Baroness, Lady Gardner, who suggested—that 80 per cent would be more sensible than 100 per cent. When the investigation takes place, we will look into all the reasons why this rather enlightened and central piece of legislation has not progressed as quickly as we hoped it would during the first year of its implementation.

Photo of Baroness Scott of Needham Market Baroness Scott of Needham Market Spokesperson in the Lords, Office of the Deputy Prime Minister

My Lords, does the noble Lord agree that it was inevitable under this system that developers of new properties would not bring properties forward under commonhold given that, by retaining the lease system, they keep for themselves ground rent, service charges and the option to sell the freehold later? Should that not have been foreseen from the outset?

Photo of Lord Evans of Temple Guiting Lord Evans of Temple Guiting Government Whip, Government Whip

My Lords, I am not sure I can agree that it should have been foreseen from the outset. However, the noble Baroness has raised a number of issues which will have to be looked at as we investigate whether we need to review this. I shall put in the Library the transcript of the "Moneybox" programme which, although the Government do not agree with some of the conclusions, discusses all the possible impediments to what is, for us and I think for the Opposition, an important piece of legislation.

Photo of Lord Renton Lord Renton Conservative

My Lords, my noble friend's Question asks how many of these commonholds include social housing. Surely all housing is social.

Photo of Lord Evans of Temple Guiting Lord Evans of Temple Guiting Government Whip, Government Whip

My Lords, that is not so in our definition of social housing. I should have said at the outset that the Land Registry does not hold information to indicate whether these developments contain social housing.

Photo of Baroness Gardner of Parkes Baroness Gardner of Parkes Conservative

My Lords, can the Minister tell me—if he does not know, perhaps he can let me know later—whether primary legislation will be required to change things? For example, if the department were able to encourage people building in the new Olympic village area to build some commonholds, that could be attached to the planning permission. Would that be a practical matter or would it require primary legislation? I am not sure. Sometimes these matters can be dealt with under secondary legislation; other times the entire matter has to be reopened.

Photo of Lord Evans of Temple Guiting Lord Evans of Temple Guiting Government Whip, Government Whip

My Lords, I shall certainly look into the question of whether it will need primary legislation. As far as the government developments are concerned—the Olympic village and the Thames Gateway—I think that we should consider as part of the investigation using these huge developments in a way that would help the advancement of the commonhold idea.