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House of Commons Hansard
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23 July 2018
Volume 645
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5. What steps his Department is taking to tackle unfair practices in the leasehold system. [906574]

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The Government want the leasehold system to be fair and transparent so that a person feels their home is their own. We will legislate to ban the sale of new leasehold houses and to reduce ground rents to a peppercorn as soon as parliamentary time allows.

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I thank the Minister for his answer. This Parliament and this Government are the first in over 15 years to seek justice and to offer the prospect of help to vulnerable residential leaseholders. Action is welcome on fair terms for new leases and to promote commonhold. However, how and when will there be beneficial steps for current leaseholders, including the many in retirement who suffer a reduction in capital values because of high event fee charges?

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My hon. Friend raises a very important issue. I congratulate her on her work, with her colleagues, on an ongoing campaign in this area, not least via the all-party group on leasehold and commonhold reform. We will shortly announce our response to the Law Commission report on tackling event fees to help those in retirement housing. The Law Commission will also consult on how we can make it easier and cheaper for existing leaseholders to buy their freehold or extend their lease.

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I, too, welcome the Law Commission report, because for too long leaseholders have been dealt a very, very poor hand. When looking at the report and developing a response, will the Government for once put leaseholders at the front of their mind, rather than the freeholders who only seem to rip off leaseholders?

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The hon. Lady makes a very good point. We also welcome the Law Commission proposals, which include recommendations to ensure that we make leaseholds cheaper and fairer. The Government will continue to work with the Law Commission to ensure that this practice continues and we get a better outcome for leaseholders.

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I speak as a contented leaseholder in my constituency. Following the question from my hon. Friend the Member for Chichester (Gillian Keegan), will the Minister say when we might expect private leaseholders in tower blocks to hear that the cladding problems are going to be paid for by the developers, insurers or others, and not by them? They are always told that they are tenants and yet have to carry all the costs for everything.

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My hon. Friend raises an absolutely important issue. Leaseholders are facing massive bills over cladding following Grenfell. Families are going to lose their homes and are faced with enormous bills; we should be helping them and are determined to do so. In the private sector, remediation costs will fall naturally to the freeholder. Where they do not, we have urged those with responsibility to follow the lead from the social sector, and private companies are already beginning to do the right thing. They should not be passing on these costs to leaseholders.

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In response to my written questions, various Ministers in the Department have confirmed that the majority of developers have agreed not to use Help to Buy loans to finance the purchase of leasehold properties in future. However, they have admitted that not all developers have agreed to do that, so what are the Government going to do to stop any taxpayers’ money being used in this way?

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Of course, certain contractual obligations are already in train. We have made it absolutely clear that no more public money will be used in such a way.