Amendment 62

Leasehold and Freehold Reform Bill - Report (and remaining stages) – in the House of Lords am 6:00 pm ar 24 Mai 2024.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Lord Young of Cookham:

Moved by Lord Young of Cookham

62: After Clause 109, insert the following new Clause—“Training and qualifications of property agents(1) The Secretary of State may by regulations require that individuals undertaking the activities of a property agent in respect of—(a) estate management of leasehold properties, (b) sale of leasehold properties, and(c) sale of freehold properties subject to estate management or service chargesmust have, or be working toward, specific mandatory qualifications, as defined by regulations made under subsection (2), to demonstrate competency to undertake their property agency roles.(2) Regulations under this section—(a) are to be made by statutory instrument,(b) may make provision generally or only in relation to specific cases,(c) may make different provision for different purposes,(d) may include supplementary, incidental, or transitional provision,(e) may specify classes or types of employees who must be qualified and the appropriate qualification level for each such group,(f) may specify syllabuses and testing methods for qualifications,(g) may specify means of training provision and minimum training hours, and(h) may approve providers for the provision of training and qualifications.(3) A statutory instrument containing regulations under this section is subject to the negative procedure.”

Photo of Lord Young of Cookham Lord Young of Cookham Deputy Chairman of Committees, Deputy Speaker (Lords)

My Lords, I hear the bell ringing as we enter the last lap. This amendment is also in the names of the noble Lord, Lord Best, and the noble Baroness, Lady Hayter, neither of whom can be in their places at the moment. It deals with the regulation of property managing agents.

In 2017, the Government committed themselves to regulating property managing agents to,

“protect leaseholders and freeholders alike”.

They then set up a working group, chaired by the noble Lord, Lord Best, which reported in 2019. In Committee, the noble Lord, Lord Best, introduced Amendment 94, which would have empowered the Secretary of State to establish an independent, statutory regulator of property agents who sell and manage leasehold property. It received widespread support from all sides of the House, but was a step too far for the Government.

The amendment before us this afternoon is in fact slightly weaker. It does not require the Government to set up that organisation; it simply requires mandatory qualifications of property managing agents. This is something that the Government have already done for the social housing sector, and it could quite easily be expanded to protect leaseholders and private tenants. I beg to move.

Photo of Lord Bailey of Paddington Lord Bailey of Paddington Ceidwadwyr

My Lords, I speak to my Amendment 67. When Parliament passed the Building Safety Act 2022, there was a major error within it. Anyone could be an accountable person except a manager appointed under Section 24 of the Landlord and Tenant Act 1987. Section 24 is a lifeline right for flat leaseholders with bad landlords, sky-high service charges and rundown buildings. Again, I return to my theme of control and the ability to remove a bad freeholder and a bad landlord—not a good one. Sadly, by barring Section 24 managers from being an accountable person, or at least from assuming that function, Section 24 is blown up.

Again, I just say that these are practical things that leaseholders will need. I believe that Labour colleagues also support this amendment. I would really like to hear from my noble friend the Minister why this cannot be done. It is a practical step, it does not seem to have any cost, and it would make a great deal of difference to the leaseholders involved.

Photo of Baroness Fox of Buckley Baroness Fox of Buckley Non-affiliated

My Lords, we are really close to the end. This is a very similar amendment to one that I proposed in Committee. In following on from what the noble Lord, Lord Moylan, said about the meeting with the Minister, I also had a meeting with the Minister half an hour before the election was announced, in which it was indicated that there was some interest by the Government in supporting this amendment. It is, of course, frustrating to be in this position in wash-up with regard to some of these details. For example, it was said only last week that, even if we were not going to get peppercorn ground rent, we might have had a very low £250 ground rent. We were all anticipating that Report would be a very positive and creative time to improve this Bill.

That was not to be the case; but for whoever takes on this brief in the future, the implication earlier today in some of the crosser exchanges was that nobody had thought about the implications of what this Bill was about. Many of us are bored of thinking of the implications and this issue has gone on for decades and decades and decades. Political parties of both sides have promised that they would resolve some of the anomalies associated with leasehold and move us on to commonhold. We are now in a situation where, through bad luck, we cannot have a full discussion on this particular Bill—it was inadequate anyway. At least we got it into wash-up, and I say simply that I found the department, the noble Baroness, Lady Scott, and the noble Lord, Lord Gascoigne, to be incredibly helpful.

It has been really enjoyable to be on the same side as the Liberal Democrats, the Labour Party and many people in the Conservative Party who all want to resolve this question. I hold those who will become the new Government to account for making sure that we get over the blips of this particularly limited Bill and resolve it. Because this will be the last time I speak, I say an enormous thank you to the tenacity and resilience of the leaseholder campaigners who have really put a huge amount in. They are not official lobbyists; they are not professionals. They are ordinary British citizens who made that terrible mistake of buying a flat or a house, not realising what leasehold would really mean for them. In many instances, this was financial penury and a lack of control, accountability and autonomy over their lives. I hope that the amendment from the noble Lord, Lord Bailey, lives to see another day and that the accountable person issues will be sorted out. This will all be resolved by commonhold in the future—whoever brings it in.

Photo of Baroness Pinnock Baroness Pinnock Liberal Democrat Lords Spokesperson (Levelling Up, Communities and Local Government) 6:15, 24 Mai 2024

My Lords, we on these Benches totally support Amendments 62 and 63 in the name of the noble Lord, Lord Best, and moved and spoken to by the noble Lord, Lord Young of Cookham. The most unfortunate part of doing this Bill in wash-up is that we have lost the opportunity to address some of the omissions in and failures of the Building Safety Act. Many leaseholders who are stuck in their properties with high and escalating insurance rates and service charges that are growing inexorably and still have a fire safety issue. These two will be issues that will I ensure are addressed by the next Government, whoever they are.

I thank those on the Front Bench for the helpful comments and the co-operation they have provided during this Bill. Most of us are of one mind: it is such a shame that this Bill is being lost without the changes that many of us would want to have put into it; but with that, I end my contribution for today.

Photo of Lord Kennedy of Southwark Lord Kennedy of Southwark Shadow Chief Whip (Lords), Deputy Chairman of Committees, Deputy Speaker (Lords)

My Lords, I will, very briefly, just add our support for Amendments 62, 63 and 67. The noble Lord, Lord Bailey, presents a way forward for addressing those issues as well. I wish we could be doing them, and I think it is disappointing we are not, but I will leave it there.

Photo of Lord Gascoigne Lord Gascoigne Lord in Waiting (HM Household) (Whip)

I thank the noble Lord, Lord Best, the noble Baroness, Lady Hayter, and my noble friends Lord Bailey of Paddington and Lord Young for their amendments, and all who have spoken in the final group of this Bill.

I will start with the amendments regarding the regulation of property agents. I thank the noble Lord, Lord Best—I appreciate he is not here—for raising the issue with the Minister recently; I know that it is something which he is passionate about, and I hope that he continues to engage extensively with the noble Baroness, Lady Scott. The Government are committed to driving up professionalism and standards among property agents. Leaseholders deserve a good service for the money they pay, whether that is from from their landlord or their managing agent, where one is in place. Industry plays an important role in driving up standards, and we welcome the ongoing work it is undertaking to support this. This includes industry-backed qualifications, as well as the preparations of codes of practice. Furthermore, the measures in the Bill, alongside existing protections in place and work being undertaken by industry, seek to make managing agents more accountable to those who pay for their services. That includes making it easier for leaseholders to take on management of their buildings themselves, where they can directly appoint or replace agents. The measures above will, I believe, contribute substantially to that objective.

In addition, we need to consider the question of standards for all property agents in the round rather than in a piecemeal fashion. That was the original purpose behind the idea of a regulator for property agents. While I recognise the intentions and desired outcomes of these amendments, I do not consider that now is the right time to introduce them.

I turn to Amendment 67. I trust that your Lordships will understand that the Government cannot accept these proposed amendments. Defining a Section 24 manager as “an accountable person” would move financial and criminal liabilities away from the existing accountable person to the Section 24 manager. It was the intent of the Building Safety Act that financial and criminal responsibility for certain aspects of maintaining the building should always remain with the accountable person and accountable persons cannot delegate this responsibility to a third party. Given these assurances, I hope that the noble Lord will withdraw his amendment and that other noble Lords will not press their amendments.

Photo of Lord Young of Cookham Lord Young of Cookham Deputy Chairman of Committees, Deputy Speaker (Lords)

My Lords, I am grateful to all those who took part in this decade. I want to pick up a point raised by my noble friend Lord Bailey when he moved his amendment to the Building Safety Act, a point also picked up by the noble Baroness, Lady Pinnock. Had this Bill proceeded in the normal way, there would have been a whole series of amendments to the Building Safety Act to deal with some of the problems mentioned by the noble Baroness but also to address the distinction between qualifying and non-qualifying leaseholders. I think there would have been a very good chance that we would have asked the other place to think again on a number of those issues—but that is for another day.

Yesterday, I think I had the last Oral Question and, unless something goes seriously wrong in another place, I may be the last speaker in this Parliament in this House. I take this opportunity to congratulate my noble friend Lord Gascoigne on the Front Bench. We have had a number of cricketing analogies about how he has coped with the googlies, but I prefer a footballing one. He is like the reserve goalkeeper who is summoned on to the pitch after full time and asked to save a large number of penalty kicks from some professional strikers. It is to his credit that he managed to tip most of the shots over the bar, although I think one or two may have got past him into the back of the net.

If the noble Baroness, Lady Scott, was watching his performance she will be well proud of what he did and, in thanking him, I also thank the noble Baroness, Lady Scott, whose patience I nearly exhausted with a number of meetings. On that basis, I beg leave to withdraw my amendment.

Amendment 62 withdrawn.

Amendment 63 not moved.

Clause 110: Interpretation of Part 6