Previous Section Back to Table of Contents Lords Hansard Home Page

Lord Lucas moved Amendment No. 25:

Page 62, line 17, leave out ("is sufficient to meet") and insert ("does not exceed").

The noble Lord said: My Lords, I am entirely in the hands of the House in relation to Amendment No. 25. I suggest that it should be agreed to on the basis that at least it moves in the direction of the mood of the House, expressed so forcefully. It will give us an amended clause with which to deal and correct in the Commons if necessary. I beg to move.

On Question, amendment agreed to.

Lord Dubs moved Amendment No. 26:

After Clause 88, insert the following new clause--

Common parts: right to self-management

(" . After section 34 of the Landlord and Tenant Act 1987 there is inserted--
"Common parts: right to self-management.
(1) The Secretary of State shall have power by order to provide a scheme for the self-management by qualifying tenants of common parts of the premises which the landlord is obliged to maintain and for which the tenants contribute a service charge under their existing leases.
(2) An order under this section shall be made by statutory instrument subject to approval by resolution of both Houses of Parliament.".").

The noble Lord said: My Lords, I make no apology for the fact that this amendment is couched in the same terms as an amendment which we discussed rather briefly on Report. The reason that I make no apology is that when I moved the amendment, the noble Earl, Lord Ferrers, in responding to it, appeared to me to be speaking largely to an amendment which I had not moved and not speaking to the amendment which I had moved in so far as he put up various objections which I suggest had no direct relevance to the amendment.

Therefore, I shall restate the issue extremely briefly. The issue relates to the right of leaseholders to self-manage the common parts of their flats. The Government did not like that as a blanket proposition and, indeed, the Minister said on Report that the right to self-management would apply whether or not the landlord was doing a good job. That is not the case. The wording of the amendment has been chosen extremely carefully. It gives the Secretary of State the powers, if he so wishes, to introduce a scheme of self-management for qualifying tenants.

That means that the Secretary of State can choose to do that or not and he can choose for which tenants he wishes to do it. He can decide on what basis a tenant would qualify. Therefore, on the wording of the amendment, the Secretary of State would be able to decide whether there should be a universal right to

17 Jul 1996 : Column 878

self-management or whether the right to self-management should be limited only to those blocks of flats where the tenants had made out a case that the management was not working out very well; in other words, all those powers rest with the Secretary of State.

It would have been very difficult to table an amendment on Report to cover the complexity of the issue. On Report the noble Lord, Lord Lucas, referred to the fact that I had sent him a 34-page amendment, which I did not table, but which described a scheme of self-management. It seemed to me that to table such a long amendment at that stage of the Bill was not the right way forward. It seemed better to me to give the Secretary of State the powers to decide how to operate the scheme and whether and when to do that. He could decide which leaseholders would qualify. I thought that that was the best way forward. Therefore, the power would be there to be used as and when the Secretary of State wished it to be used.

Finally, we have had quite a long debate this afternoon about the cost of taking cases to leasehold valuation tribunals. The fact is that in so far as leaseholders are given the right to self-management, all the arguments about the costs of LVTs go by the board. We are dealing with a simple right for people in leasehold circumstances to have the same ability to manage the common parts of their flats as the Government have given to council tenants, and quite properly so. There is nothing outrageous about it. The Secretary of State could well decide that lessees who have good landlords should not be given the right and the right would be given only in circumstances where landlords had not behaved quite as well as they might have done. There is scope for flexibility and the amendment meets all the objections to which the Minister gave voice on the last occasion that we discussed this matter. I beg to move.

Lord Monson: My Lords, as I tried to point out when we debated an identical amendment on Report, this is a more complex and less straightforward matter than it appears.

Ten years ago, I should have taken it for granted that self-management was preferable to management by even the most benevolent ground landlord. But the experience of some of my family since then has totally changed my mind.

Lessees need effective maintenance at a fair price--and a price there is certainly going to be, whoever is responsible for the management. Now that the undoubted deficiencies of the 1987 Act have been remedied and the misbehaviour and over-charging of rogue landlords rightly curbed, I am sure that in most cases lessees will be better off overall not managing the common parts themselves. If time permitted--and I do not think it does--I should explain in detail exactly why that is so.

Even those who still swear by the notion of self-management will surely admit that it is not right for every aspect of maintenance. Certainly porterage could be self-managed in those statistically rare cases

17 Jul 1996 : Column 879

where blocks of flats have resident porters. The same might be said of the cleaning of common parts provided that one acknowledges that insufficiently frequent cleaning and inefficient waste disposal could lead to a dangerously increased fire risk. Redecoration is a borderline case: there are good arguments both ways. But structural repairs are surely best left to the ground landlord.

I am trying to point out that these are contentious matters which need thorough debate. They are surely matters for primary rather than secondary legislation and therefore I oppose the amendment.

Earl Ferrers: My Lords, the noble Lord, Lord Dubs, has made me nervous. He said that he put down an amendment at Report stage and that I answered an amendment which he did not put down but did not answer the amendment that he did put down. I fear that I might be in the same trouble today if I am not careful.

I can only answer the amendment by stating the way we interpret the effect that it will have. This is all about giving people a right to manage. The Government have always, throughout the whole of this Bill, opposed an unfettered right to manage, both on grounds of principle and practicality. We have set out our reasons for this and detailed our objections at every stage when there has been a debate on this, both in the other place and in your Lordships' House.

We are opposed in principle to a right to manage because it could require any landlord, no matter how well he was carrying out his responsibilities, to hand over the management to leaseholders. The noble Lord, Lord Dubs, is saying by his amendment, "But that would only be after the Secretary of State had issued an order". Nevertheless, if my right honourable friend were to issue an order, the landlord could find his responsibilities in that regard taken away from him.

Whether or not we like it, it is a fact that the price which a landlord pays for property reflects the income which is available from the management of it. Management should be a wholly reputable business; quite obviously exploitation is not. If the management of the property is of a high standard, then that is a good thing for the tenants and retains a value for the management.

The proposal of the noble Lord, Lord Dubs, seems to envisage no provision for any element of compensation were the landlord to find that his right to manage his property had been taken away, even where he was carrying out his duty perfectly successfully and properly. That is not the right approach.

The Government's proposals set out in the Bill assist leaseholders and represent a better alternative. They include an end to the abuse of forfeiture proceedings by landlords as a means of frightening leaseholders into paying unreasonable service charges. They also include a new means of resolving disputes over service charges, and strengthen the right to seek the appointment of an independent manager where it can be demonstrated to a tribunal that the landlord is not doing his job properly. We are also widening the scope of leaseholding enfranchisement to give leaseholders the opportunity to

17 Jul 1996 : Column 880

take on the full responsibilities of freehold ownership, while at the same time offering the landlord a fair price for it.

We are concerned about the practicalities of the noble Lord's proposal. If the amendment were to be accepted by your Lordships, then a complex measure would be introduced on the face of the Bill by a single clause. This would then allow the Secretary of State to construct some scheme at a future date through secondary legislation. That would be highly unsatisfactory. If the noble Lord, Lord Carter, were here, he would probably prefer it to be done by an affirmative resolution, too; but that is de minimis. For those reasons I hope that the noble Lord will consider his amendment inappropriate. Whatever I did on the last occasion, I hope I have at least answered his amendment on this occasion.

Next Section Back to Table of Contents Lords Hansard Home Page