Debates — Building Safety Act 2022

Report stage in the Lords

29 Mar 202265 speechesView in Hansard ↗

Baroness Bloomfield of Hinton Waldrist (Con)My Lords, again, I thank those who have participated in this interesting debate.
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Baroness Bloomfield of Hinton Waldrist (Con)Conservative
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My Lords, again, I thank those who have participated in this interesting debate.
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15:24
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Baroness Pinnock (LD)My Lords—
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Baroness Pinnock (LD)Liberal Democrat
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My Lords—
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Baroness Bloomfield of Hinton Waldrist (Con)Oh, I thought we had finished.
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Baroness Bloomfield of Hinton Waldrist (Con)Conservative
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Oh, I thought we had finished.
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Baroness Pinnock (LD)No, we stopped before the noble Baroness, Lady Hayman, and I had had a chance to speak. That is what comes of stopping…
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Baroness Pinnock (LD)Liberal Democrat
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No, we stopped before the noble Baroness, Lady Hayman, and I had had a chance to speak. That is what comes of stopping mid-flight, but here we go—if anybody can remember what we were doing an hour ago. Before I go on, I remind the House of my relevant interests, as a member of Kirklees Council and as a vice-president of the Local Government Association. First, I speak to Amendment 15, which is in the name of the noble Baroness, Lady Hayman of Ullock, and to which I put my name. I raised a number of concerns at Second Reading and in Committee about the consequences of the part-privatisation of building control inspectors some 20-odd years ago, whereby developers can and do appoint their own building control inspectors. As noble Lords will know who have been here throughout all these stages, I have referred before to my favourite: “Quis custodiet ipsos custodes?” Who will call these folk to account? At the moment, nobody does, and the result is what we are trying to deal with today. If we had a band of building control inspectors who were like terriers in pursuit of bad practice and cutting corners, we would not be here today trying to put things right. So this is absolutely key to what we are doing—and, of course, I support the creation of the building safety regulator, and all the other parts of the Bill that the Government have introduced, but I recognise that it affects only buildings of 18 metres and above. Dame Judith Hackitt brought to our attention in her report her grave concern about developers who can choose their own inspector. Two things need to be dealt with: they should no longer be able to do so, and we should not create a two-tier inspection system. This amendment tries to put those two things right, and I am sure that the Government will accept it. It is, dare I say it, common sense. Why would you have such a stringent regulatory system for 18 metres and above, which I totally support, and then say, “Oh well, for the others it’ll be okay.” It will not be okay, and it has not been, so let us put it right. The amendment proposes that local authority building inspectors take on that role. I support that idea not because they are local authority, but because they are based in an area and are therefore attached to the council and know who the builders are in that area. They know the particular problems of building in the Pennines, for example, where there is not much ground before you hit solid stone, or of building in London clay, where the problems are different. If we have building control inspectors who recognise the different problems across the country, we are more likely to get regulations that are adhered to. This is an important amendment, and I hope that the Government will treat it in that light. My noble friend has already introduced Amendment 264, which is also in my name. It is also fundamental to building safety, because unless you have a workforce imbued with the knowledge and experience of building in a safe way, we will have the current corrosive construction industry culture that we and the Minister have spoken about. This is one way, one route, one of the tools in the toolbox—another phrase he loves—to try and put that right. Both those amendments are key. I think the Minister will say: “Yeah, that was really good. Why did we not think of it?” But I am an optimist.
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Baroness Bloomfield of Hinton Waldrist (Con)I must again thank those noble Lords who have participated in this interesting debate. It is a shame it has become a gr…
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Baroness Bloomfield of Hinton Waldrist (Con)Conservative
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I must again thank those noble Lords who have participated in this interesting debate. It is a shame it has become a group of two halves, but I will address the points raised in turn. Turning first to Amendment 15, I thank the noble Baronesses, Lady Hayman of Ullock and Lady Pinnock, for raising this important matter, but as they have surmised, I am afraid the Government will not be able to accept this amendment. The noble Baroness, Lady Pinnock, will know that local authorities are already the statutory provider of building control services to the public under the Building Act 1984. This includes the duty to enforce the Act in their jurisdiction and they retain ultimate responsibility with regard to enforcement action, except where the building safety regulator is the building control authority. In response to the concerns of the noble Baroness, Lady Pinnock, I can say we are introducing a system of oversight, registration and regulation, driving up standards across both public and private sector building control. The Bill introduces a new professional framework for which individual registration will be based on competence, subject to a code of conduct and sanctions where standards fall short. Registered building control approvers and building control authorities will need to obtain and consider the advice of a registered building inspector before carrying out certain building control functions and use a registered building inspector to undertake certain activities. This greater scrutiny and accountability will provide greater incentive to ensure all buildings, including non-higher-risk buildings, are safe. Our approach is proportionate to risk. The new regulatory regime set out in the Bill and draft secondary legislation is proportionate to the level of risk potentially found in high-rise residential and other in-scope buildings. The Government have chosen to set the scope of the new more stringent regime at 18 metres or seven storeys, as we are committed to following this risk-based approach. Evidence from Dame Judith Hackitt has shown that, in general, the risk from fire increases with height. Through the Bill, the Fire Safety Act and further fire reform, we are working to protect all residents in buildings, regardless of height. Given these points, I hope your Lordships will agree that this amendment is not required. Turning to Amendment 254, on sale of goods online, I reassure noble Lords that the Government fully recognise the importance of ensuring product safety, not only in relation to fire risk but also for the wider prevention of harm. As I set out in Grand Committee, existing product safety legislation applies to all products, whether sold online or offline. However, the Government also recognise that the rapid growth of e-commerce, particularly of third-party sales via online marketplaces, presents a significant challenge. While I sympathise with the intention of the amendment, it represents only a partial response to the wider issue of unsafe products sold online. This illustrates that the Bill is not the best means of addressing the issue. The ongoing product safety review, which is examining the full range of consumer products and the role of online sales, is the more appropriate vehicle for meeting the concerns of the noble Lord, Lord Foster. He mentioned the letter I wrote after Committee to electrical safety firms. As I said, we are planning a consultation on proposals for reform, which will be published not later this year, as previously stated, but later this spring. Once it is published, I will be happy to update the noble Lord and this House to ensure that concerns raised in this debate are fully reflected. I hope I have reassured the noble Lord. Turning to Amendment 261, again I thank the noble Lord for raising this important matter and recognise his concerns about poor-quality homes. However, I am afraid that the Government will not be able to accept this amendment, as it pre-empts and duplicates work already being undertaken across government. As the noble Lord reminded the House, in 2017, the Government committed in The Clean Growth Strategy to improve as many homes as possible to EPC band C by 2035. Where practical, affordable and cost-effective, we are seeking to bring as many private rental homes as possible in line with EPC band C by 2030. The Government have now consulted on raising the energy performance standard in the domestic private rented sector to EPC band C and will be publishing our response in due course. I hope the noble Lord will take some comfort from this. In the energy White Paper, we announced our intention to seek primary powers to create a long-term regulatory framework to improve the energy performance of homes, alongside a package of incentives. We have consulted with a wide range of stakeholders and will undertake further consultation on specific policy design before making secondary legislation. In the social housing White Paper, we pledged to review the statutory decent homes standard by 2024, to consider how it can better support decarbonisation and improve the energy efficiency of social homes. We shall publish a White Paper in the spring to reform the private rented sector. Some £800 million was committed through the 2021 spending review for a social housing decarbonisation fund and, as further evidence of our intent, we also committed in the levelling up White Paper to explore proposals for new minimum standards in the social and private rented sectors. In the Net Zero Strategy, we reiterated our commitment to consulting on phasing in higher minimum performance standards to ensure all homes meet EPC band C by 2035 where practical, cost-effective and affordable. I can assure the noble Lord that the Government will deliver on all our commitments in this space, but I ask that he does not press this amendment. Turning to Amendment 262, on staircase regulations, I thank the noble Baronesses for raising this important matter and other noble Lords for contributing to this debate, but I am afraid that the Government will not be able to accept this amendment. As the noble Baroness, Lady Jolly, mentioned, my noble friend the Minister convened a meeting of the Building Regulations Advisory Committee on 16 March to seek its advice on this matter. I have the response from its chairman here. The Building Regulations Advisory Committee has advised that the Government should carry out a review of the statutory guidance, approved document K, focusing on section K1, which covers staircases. It also advised that it was more appropriate to deal with this issue through the building regulations and associated statutory guidance than in primary legislation. In his letter, Hywel Davies says that BRAC agrees that it is more appropriate to seek to address this problem through building regulations and associated statutory guidance than in primary legislation and recommends a focused review of ADK section 1. Further detail on the potential scope of the review of ADK is set out in annexe 1 of the letter. The Government have accepted the advice of the Building Regulations Advisory Committee and will now put in motion a review of approved document K, focusing primarily on section K1. This review will run in parallel with the review already under way of approved document M, which looks at accessibility. This review will consult on raising the safety of staircases to that achieved by meeting the British Standard on staircases, BS 5395-1. I reassure noble Lords that this will be done as expeditiously as possible and certainly within the year. I assure the noble Baroness that this review will fully address her intention to consult on improving standards of staircase safety in England. I thank her for raising this important matter and assure her that it is being addressed by government. Turning to Amendment 264, laid by the noble Baroness, Lady Pinnock, and the noble Lord, Lord Stunell, I thank noble Lords for raising this important matter. As I assured them in Grand Committee, their intentions have been met in the Bill. Clause 10 requires the building safety regulator to establish the industry competence committee, which will oversee and monitor industry’s development of competence frameworks and training, undertake analysis to understand areas for improvement, and work with industry to drive gap-filling. The committee will provide reports of its work to the regulator periodically. The Health and Safety Executive has established an interim industry competence committee, which is developing its plan for supporting industry’s work, including understanding the current competence landscape. Training and certification of competent individuals is not a function of government or the regulator under this Bill. The industry needs to lead the work to improve competence, identify skills and capacity gaps, and provide appropriate training for its members, and has already started this work. The Government continue to monitor industry’s progress and will provide support where necessary. Clause 152 legislates for the appointment, at least once every five years, of an independent person to carry out a review of the system of regulation for building safety and standards and the system of regulation for construction products. Importantly, the reviewer is not limited and may choose to review connected matters, which could include the built environment industry workforce. When defining “independent”, we have excluded those with a clear conflict of interest, without overreaching and excluding everyone with relevant experience. Given this explanation, I trust that noble Lords will agree that Amendment 264 duplicates many of the existing provisions in the Bill. With those reassurances, I respectfully ask the noble Baroness to withdraw her amendment.
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Baroness Hayman of Ullock (Lab)My Lords, I thank the Minister for her detailed response. I was very pleased to hear her response to the amendment on s…
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Baroness Hayman of Ullock (Lab)Labour
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My Lords, I thank the Minister for her detailed response. I was very pleased to hear her response to the amendment on staircase safety from the noble Baroness, Lady Jolly. It is good that the Government are going to review this. I am sure noble Lords will keep the pressure on to make sure that that is done expeditiously. Coming to my Amendment 15, again, I thank the Minister for her response. I am still concerned about the potential for a two-tier system and potential conflicts of interest, so I ask the Minister whether she could encourage the Government to monitor these issues once this becomes law to ensure that we do not end up with a system that does not work for all people. In the meantime, I beg leave to withdraw my amendment.
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Baroness Scott of Bybrook (Con)My Lords, I open this group by introducing a number of technical amendments tabled to strengthen the Bill. Included wit…
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Baroness Scott of Bybrook (Con)Conservative
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My Lords, I open this group by introducing a number of technical amendments tabled to strengthen the Bill. Included within this group are amendments that simply update the drafting of the Bill. These include Amendments 72, 75, 79 and 274. I will speak to government Amendments 17 to 19, which make changes to Clauses 41 and 47 and introduce a new clause relating to approved inspectors. Amendments 18 and 19 relate specifically to approved inspectors’ insurance, while Amendment 17 introduces a power for the regulatory authority to inspect local authorities and registered building control approvers. The Building Act 1984 currently requires approved inspectors to hold insurance through a government-approved scheme. These amendments remove this requirement. Instead, approved inspectors will need to identify adequate cover themselves, encouraging competition between insurance providers.
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Lord Stunell (LD)My Lords, I have a couple of points that would perhaps have been better taken in Committee, but we did not have the ame…
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Lord Stunell (LD)Liberal Democrat
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My Lords, I have a couple of points that would perhaps have been better taken in Committee, but we did not have the amendments then, so I apologise for these rather Committee-related points. I refer to the government Amendments 18 and 19 about insurance requirements, which I am afraid are not very self-explanatory and, in the absence of explanatory text, rather impenetrable. Amendment 18 rather boldly says, “Leave out Clause 47”. Clause 47 is one that requires there to be an insurance scheme for certain officials, as the Minister has just set out. That is in a context where, in Amendment 243, the Government have found the need to step in to provide a warranty scheme and make sure it really happens. In the building industry, many of those looking for professional indemnity insurance have found that in the first year after Grenfell their premiums went up by a factor of two, and in the most recent year their premiums have gone up by a factor of four. Insurers are fleeing the market of providing professional indemnity insurance for anybody who has anything to do with the construction industry. So I wondered whether there was any evidence available, to the Minister or the department, that there was a functioning market in insurance products for those for whom this requirement is being changed. It was, as the Minister has just said, up to professionals in this new profession to seek out insurance, just as it was for professionals such as architects, surveyors or whoever it might be. In a situation where that insurance market is shrinking, and where the Government have found it necessary to talk about imposing a requirement in relation to housing warranties, how happy are they that such a market really exists, and that the abolition of Clause 47’s requirements actually make sense? I am not proposing an amendment. I am simply seeking to establish that the Government do know exactly what they are doing, and also asking them to explain to this House and noble Lords what exactly they are intending to do.
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Lord Khan of Burnley (Lab)My Lords, I welcome these technical amendments, tabled by the Minister. While I will not unnecessarily detain the House…
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Lord Khan of Burnley (Lab)Labour
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My Lords, I welcome these technical amendments, tabled by the Minister. While I will not unnecessarily detain the House by discussing each amendment, I would appreciate clarification on a small number of issues. First, Amendment 17 provides the building safety regulator with a power to conduct inspections of building control bodies, thereby giving further oversight of building control bodies provision. Can the Minister explain what guidance will be given on the conduct of such inspections? Secondly, Amendments 243, 244 and 265 will together mandate a warranty of 15 years minimum as a standard, while enabling the making of regulations for warranties to set a minimum period of liability for developers, minimum standards for the warranty, and a penalty regime for any developers failing to comply. On the warranty, can the Minister explain the rationale for 15 years? Can she elaborate on the Government’s plans for the penalty regime? As I stated earlier, I welcome these technical amendments and look forward to clarification from the Minister.
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Baroness Scott of Bybrook (Con)My Lords, I thank noble Lords for this short debate on these amendments. I am very pleased that most of them, if not al…
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Baroness Scott of Bybrook (Con)Conservative
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My Lords, I thank noble Lords for this short debate on these amendments. I am very pleased that most of them, if not all of them, have been welcomed, because I think they will make a difference to the housing market. The noble Lord, Lord Stunell, brought up the issue of why the amendments have come so late. It is because we listened; the Minister listened, in Committee, to this issue, and therefore the Government have brought forward these amendments. I think the important thing about insurance requirements, as I said, is that the Government are expecting this to reinvigorate the insurance market. At the moment, that is not the case because it is all done through specific Government-procured insurance. This should reinvigorate the market that, as he quite rightly says, is not as vigorous as it should be at the moment. So that is one thing. The insurance of approved inspectors was mentioned. It will be for the building safety regulator to decide how to set up insurance requirements for approved inspectors. This can be done by the regulator through its professional conduct rules. The noble Lord, Lord Khan, asked who has oversight of this. It will be the building safety regulator. That is their job, and it is through their rules and regulations that they will make sure that these things are delivered. Lastly, I am afraid I do not know how the 15 years came about, but I will find an answer for the noble Lord. It is in line with the prospective limitation period for action under the Defective Premises Act 1972—but I will find out how that came about in 1972 for the noble Lord.
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The Minister of State, Home Office and Department for Levelling Up, Housing & Communities (Lord Greenhalgh) (Con)My Lords, I am very pleased to speak to a group of amendments that will strengthen our solution in law to ensure that t…
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The Minister of State, Home Office and Department for Levelling Up, Housing & Communities (Lord Greenhalgh) (Con)Conservative
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My Lords, I am very pleased to speak to a group of amendments that will strengthen our solution in law to ensure that the industry pays to remediate all unsafe high-rise and medium-rise buildings for which it is responsible, and contributes to fund the remediation of all cladding on 11-metre to 18-metre buildings. As discussed during our debate in Committee, we need to take action against those unwilling to make these commitments and impose a solution in law to make sure that developers and manufacturers take responsibility for rectifying building safety defects—the polluter must pay. Amendments 133 to 136 set out a number of changes to the definition of associated persons within the leaseholder protections provisions. Amendment 137 sets out that partnerships are captured within the definition of an associated company and Amendment 139 defines joint ventures. This will ensure that well-resourced companies cannot make use of complex corporate structures to evade their responsibilities. These amendments pierce the corporate veil. Amendment 179 confers a power to make regulations to require landlords to provide information to a relevant tenant or other prescribed person I will now speak to amendments we are making to Clauses 128 and 129, which I moved in Committee. As noble Lords may remember, these clauses give the Government the power to establish building industry schemes. We want to use this power to enable us to establish a scheme to distinguish between building industry actors who have committed to act responsibly and make buildings safe, and irresponsible actors who have failed to do so. The amendments tabled on 22 March add detail to those powers, to reflect more clearly the Government’s intentions and to provide Parliament and the public with more information on the purpose of any building industry scheme or schemes we set up, together with indicative examples of the kinds of membership conditions that eligible industry actors may need to meet to be part of a scheme. We have made it clear that we expect the industry to act now to take responsibility for fixing building safety defects, and our principal objective in establishing a scheme under this power would be to make sure that we can hold industry to account against this and other obligations. Examples of the kinds of membership conditions that may apply to members of a scheme in connection with these purposes include: the remedying of defects in buildings to which an industry actor has a connection; and making financial contributions towards remediation of defects in buildings, including by way of contribution to a general industry fund to pay for remediation. We may also require scheme members not to use certain construction products made by prescribed manufacturers—for example, cladding and insulation products made by manufacturers who have failed to step up and commit to an industry solution by making a financial contribution to remediating unsafe buildings.
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Lord Young of Cookham (Con)My Lords, I welcome the amendments tabled by the Government. As my noble friend has explained, they extend the scope of…
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Lord Young of Cookham (Con)Conservative
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My Lords, I welcome the amendments tabled by the Government. As my noble friend has explained, they extend the scope of liability, making it more likely that builders will be remediated. The amendments also block some loopholes, and I welcome that. I begin with a general point about amending this part of the Bill. I understand the caution that many in your Lordships’ House have about amending a Bill at this stage of a Parliament if it has been fully scrutinised by the Commons. However, there should be no such inhibitions about amending this part of the Bill, because although the Bill started in another place, the remediation clauses were added in your Lordships’ House, and the other place has never considered them. So, as part of our role we should feel free to amend the Bill if we feel that that is the right thing to do, not least because the Government have themselves tabled several hundred amendments. I make it clear that I welcome the amendments on remediation, and I commend my noble friend and Michael Gove on the substantial progress that they have made in beginning to address the crisis facing thousands of leaseholders trapped in unsaleable flats, facing unaffordable remediation bills and repossession as well as, in many cases, high insurance premiums and the costs of waking watches, while continuing to live in a building which is a fire risk. My noble friend has moved the dial, and is to be commended for that, but, as today’s debate will show, the Bill as it stands falls well short of assurances that Ministers have given to leaseholders, who are the only innocent party in a scandal that has involved developers, contractors, local authorities and, indeed, as is emerging from the Grenfell inquiry, the Government, who knew about the cladding problems 15 years before Grenfell—and did nothing. In this section of the Bill we are building on the Government’s proposals and we do so after extensive discussions with Ministers and officials, for which we are really grateful. We hope that it may still be possible, even at this late stage, to find common ground. In particular, we seek to amend the Bill to be consistent with commitments that Ministers have made on the record. I remind my noble friend the Minister of what he told noble Lords in his letter dated 20 January, entitled “Introduction of the Building Safety Bill”. He said: “The Secretary of State recently announced that leaseholders living in their homes should be protected from the costs of remediating historic building safety defects.” That letter built on the Statement made by the Secretary of State, Michael Gove, on 10 January in another place. He said: “First, we will make sure that we provide leaseholders with statutory protection … and we will work with colleagues across the House to ensure that that statutory protection extends to all the work”— all the work— “required to make buildings safe.” The Statement said: “We will take action to end the scandal and protect leaseholders.” It continued: “We will make industry pay to fix all of the remaining problems and help to cover the range of costs facing leaseholders.”—[Official Report, Commons, 10/1/22; cols. 285-291.] I think we would all agree with that. However, since then these commitments have been watered down. Not all leaseholders are covered by the Bill, not all buildings are covered by the Bill, and defects have been sub-divided into those that are fully protected by qualifying leaseholders, and other defects that are not. I see no guiding principle behind these distinctions, but the consequence is protecting the contractor/taxpayer and putting more costs on to the only innocent party: the leaseholder. Turning to Amendment 233, in my name and that of my noble friend Lord Blencathra, I appreciate that there are other proposals that have the same objective as ours, namely Amendments 221 and 234. I am in no way prescriptive about how the problem is tackled. The best way forward may be for my noble friend the Minister to say that he recognises the problem and will come up with the same solution at a later stage, so let me describe the problem. The Government’s so-called waterfall proposal creates a pyramid of contributions, with developers at the top and leaseholders at the bottom. This is a welcome inversion of the situation under the current law, where the leaseholders are in the firing line, and the Government should be commended for it, but the waterfall does not live up to Michael Gove’s Statement, in which he said that “leaseholders are shouldering a desperately unfair burden. They are blameless, and it is morally wrong that they should be the ones asked to pay the price. I am clear about who should pay the price for remedying failures. It should be the industries that profited, as they caused the problem, and those who have continued to profit, as they make it worse.”—[Official Report, Commons, 10/1/22; cols. 283-84.] We have been told at meetings with officials and Ministers that good progress has been made in persuading the industry to accept its responsibility and remediate the buildings for which it is responsible, doubtless incentivised by some of the provisions in the Bill. I commend Ministers for the progress they have made. However, we are left with the issue of what happens to buildings where remediation does not happen—the so-called orphaned buildings. The freeholder has no resources, there is no developer or contractor to sue, and so we reach the end of the waterfall: the leaseholders. What are they supposed to do? Are they supposed to pay for all the non-cladding costs, which they cannot afford? In many cases these are higher than the cladding costs. Should they continue to live in a dangerous building, with properties that they cannot sell and with high insurance premiums? Let me illustrate this with an example, Northpoint in Bromley. The developer, Taylor Wimpey, a company listed on the FTSE 100, refuses to pay, I am told. The building is already in the building safety fund for cladding, so taxpayers are picking up the bill. Under the waterfall, we come to the resident management company, which is run by the leaseholders. It collects the service charge and therefore has a liability in step 2 of the Government’s waterfall, but it has no assets and does not have an interest worth £2 million, so we reach the end of the waterfall: the leaseholders. Most flats in Northpoint are worth less than £325,000, so there will be zero commitment to be collected from most leaseholders for non-cladding costs, thanks to the Government’s low-value exemption. A handful of the flats in that building are worth more than £325,000, so those few leaseholders are in the invidious position of having to pay £15,000—but they do not have to pay, because waking watches have eaten up their £15,000 caps already, so they pay nothing. At Northpoint, the non-cladding works are not covered by the building safety fund, so who will pay? The only option for the moment is to ask the leaseholders to pay, wearing their hats as shareholders in the resident management company, but that defeats the point of the caps the Government have proposed for leaseholders. There are many other examples of no liability on someone with assets to pay—the so-called orphaned buildings. It is unacceptable that dangerous buildings, part of this country’s housing stock, should remain in this condition either indefinitely or until prolonged litigation has been completed.
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The Earl of Lytton (CB)My Lords, as it is my first contribution in this part of the Bill, I must necessarily declare my interests as a practis…
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The Earl of Lytton (CB)Crossbench
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My Lords, as it is my first contribution in this part of the Bill, I must necessarily declare my interests as a practising chartered surveyor, a member of the RICS and a patron of the Charted Association of Building Engineers. I am also a member of the Built Environment Select Committee, chaired by the doughty noble Baroness, Lady Neville-Rolfe, who keeps us all in order. I think she is splendid and I do not say that for want of any favours. I also own residential rented property: no flats, no high-rise, thank goodness. I pay tribute to the Minister for the meetings he has arranged, the dialogue in which he has been willing to engage and his untiring efforts and those of his Bill team. It is fair to say that we have come an enormous way in this Bill and that is in large part, if not solely, because of the drive the Minister has put into this. I am pleased that he has clarified the limited partnerships and provided the other clarifications in the amendments he has introduced. I also pay tribute to all noble Lords around the House who have stuck with the principle that the innocent should not be made to pay for the mistakes of the developers and constructors. I will just deal, if I may, with Amendments 201 and 202, which are in my name and on which I will not be seeking the opinion of the House. They relate to a matter I referred to in Committee, which is insolvent landlords and their interests being escheated to the Crown. That means that potentially, there is no landlord as such to organise remediation work, leaving remediation in limbo and responsibility for costs uncertain. That follows on from what the noble Lord, Lord Young of Cookham, set out with, I may say, a degree of piercing clarity which I found unchallengeable. I will outline the differences between my further amendments and his, but not on these ones. The sole purpose of my Amendment 201 is to clarify the Crown responsibility. Amendment 202 covers where a superior leaseholder defaults and as a result the liability potentially passes to others. This amendment would serve to prevent a lease being disclaimed, thereby creating another loophole and another piece of loose liability floating around the system. Amendment 229 in my name is another probing amendment; I hope it is self-explanatory. It attempts to deal with a perceived problem of delay by landlords and agents in accepting first funding agreements for remediation. The matter was highlighted in a recent edition of Inside Housing. Reference was made to the logjam created because managing agents were reluctant to sign off on remediation contracts without knowing who would be paying for the work or, indeed, when. That effectively stalled the first funding offer acceptance. It was thought that the matter had been resolved; according to the Inside Housing article, the Minister confirmed in December that the logjam had been cleared. Notwithstanding this, the article said, the problems persist. It reported cases in St Albans, London and Manchester; in other words, all over the country. It is known that there are few enough contractors ready and willing to take on the—quite demanding in some cases—work of remediation, which this Bill addresses. Delay will simply cause contractors to go elsewhere and opportunities to be lost. This prejudices both leaseholder and, ultimately, I suspect, freeholder. It makes no sense. There may be many reasons for this—usually, I suspect, surrounding the landlord’s own tactical and financial advantage—but none can justify the excessive delay that this amendment seeks to avoid. There seems to be a bit of a blame game going on between the department on the one hand and block management interests on the other. I am reluctant to take sides on that. This amendment intends to treat the symptoms by setting a time limit on acceptance of the offer so that things cannot be spun out. I hope that it will have the effect of concentrating minds and will be conducive to good order for that reason. I now turn to Amendments 234 to 237 in my name. I make it clear that, subject to what I may hear from the Minister, I may need to test the opinion of the House on these amendments. They would have a similar effect to Amendment 233 in the name of the noble Lord, Lord Young; namely, to relieve leaseholders and freeholders of what many of us feel is an unjust imposition. Much of what we have been discussing arises because the Government believe, as I do, that, given the 30 years during which certain bad practices have taken root in construction quality, not every defect will have an identifiable perpetrator or associate currently in existence, solvent and with sufficient assets to make a claim a practical possibility. The Government seek to ensure that, if a construction defect exists which does not fall within their scheme of financial support for remediation and there is no perpetrator to be found, the public interest that buildings are made safe will persist. In their view, the only other possible sources of remediation funding are the freeholders and leaseholders. I think it is fair to say that the noble Lords, Lord Young and Lord Blencathra, and I have been in a sort of huddle since Grand Committee. We all believe that the fallback should be the perpetrator of the situation. The amendment in the name of the noble Lord, Lord Young, proposes falling back on the local authority or the Secretary of State—AKA the taxpayer. I am aware that the Treasury has said, in fairly blunt terms, “We have made an allocation of £5.1 billion and that is it.” That means no more money unless it comes out of the departmental budget, impinging on other important work that the department might wish to take place. I take it that this is one reason, among many, why the Secretary of State has taken the initiative to protect the departmental budget by seeking voluntary contributions from the construction industry for a further £4 billion for other defects—good on the Secretary of State for doing that. The first question I have for the Minister is: can he update us on how things are progressing on that voluntary scheme? Certainly, the industry’s initial response was not very fulsome, and the Secretary of State made what one might describe as a somewhat sterner demand— and very rightly too. The Minister’s answer is pivotal to how likely it is that property owners will have to fork out for these defects and thus require the protections he seeks to build into this Bill. If the perpetrator, as defined, cannot be found, then it becomes a test of what is “just and equitable”—to use the words in the Bill—in apportioning the orphaned responsibility and cost between two groups of property owners, who, in the main, are likely to be completely innocent of the construction-related defects and for whom arguably it is neither just nor equitable that they should bear that responsibility and cost at all. Of course, that circumvents what I understand to be meant by the perpetrator pays principle, and results in the passing back of both responsibility and cost—the two are not exactly the same—to the innocent. Given the Government’s insistence on this approach, I conclude that the deficit between what can be claimed from extant, solvent and legally liable developers on the one hand, and the true remediation cost on the other, is likely to be significant; otherwise, why would we be here? Meanwhile, I sense the industry is telling us, in the blunt cant of the trade, that we can whistle for it. The Government’s remediation model of liabilities, exemptions, cost controls, means testing, tiered contributions by property value, appeals to courts and much chasing of tails withal is certainly not straight-forward. Any one of the procedural steps is contestable to some degree and contested they will undoubtedly be. So, while the many leaseholder protections are welcome, such as cladding on buildings over 11 metres, building safety levy backstops on cladding costs, exemptions for sub-£175,000—or £325,000 in London—properties, and non-cladding remediation where the landlord is or was connected to developer. These are very welcome, but the model is incomplete and there remain significant exclusions. Properties under 11 metres are certainly one of them, but we will have to wait until we get to Amendment 115 in a later group to discuss that. There is also the question of buy-to-let landlords with more than three properties, but we will have to wait until we get to Amendment 123 to consider that. There is no backstop for non-cladding remediation costs. Leaseholders in enfranchised or commonhold blocks, as discussed in Amendment 117, may get some support for cladding remediation from the building safety fund, but I question whether they will get everything they are due under a true perpetrator pays principle. Some issues have not necessarily been eliminated, despite what the Government claim. The noble Lord, Lord Young, referred to the waterfall, so I can skip my explanation as he has explained it much better than I would. Establishing cost liability does not of itself generate funds for remediation if those liable to pay are broke. It is a very important principle, because if the guys made responsible have no assets or cannot get at their assets because they are mortgaged up to the hilt and there is no equity, then what is the purpose of placing this onus on them in the first place? The Government are taking a substantial risk in leaving it to the courts to decide whether it would be “just and equitable” as regards their various proposed orders. That seems to be tantamount to an invitation for further litigation, delay, uncertainty, risks, and so on. There will be applications for remediation orders, remediation cost orders, building liability orders, and litigation under the Defective Premises Act—my mind freezes over when I see that list. There is no bridging funding facility in any of this, so unless the Secretary of State steps in or some other funding is levered in, remediation cannot take place. People cannot simply buy in on spec some large amount of a contractor’s time and substance; it is just not going to happen. Some of those who might, I suppose, be in line to be contributors to this just and equitable approach to splitting it between innocent parties—and I am sorry to go on about that—are not going to be there. Some buy-to-let investors will be denied any protections, and some landlords will fail the cost contribution test; I tried to make that clear when we were dealing with this in Committee. If you multiply the number of properties that they hold by £2 million per property, you will very often find that the total figure is greater than their capitalised worth—ergo, they drop out of responsibility.
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Baroness Pinnock (LD)My Lords, there are 70 amendments in this group, but, on a positive note, they are all seeking to protect leaseholders.…
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Baroness Pinnock (LD)Liberal Democrat
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My Lords, there are 70 amendments in this group, but, on a positive note, they are all seeking to protect leaseholders. We have been very fortunate in having such a clear exposition of the issues which remain from the noble Lord, Lord Young of Cookham, who has demonstrated that there is still a gap in what the Government have set out. Who pays when there is literally no one left to pay? This relates to the orphan buildings, as the noble Lord has described them. That must be resolved. The noble Earl, Lord Lytton, has just shared his expertise on the matter. I admit that I have not quite understood every part of what he said, except that I know that it is based on knowledge and experience. I am very grateful to him for sharing it with the rest of the House and trying to find solutions to the problems which remain. I have my name on four amendments. I will speak particularly to two of these which are, in a rather more straightforward way, seeking to achieve the same ends. Amendment 200, in my name and that of my noble friend Lord Stunell, presents another way by which leaseholders will be protected from any payment which results from the approach which the Government are taking—and which we will discuss in group 7—regarding who pays and how much leaseholders should be expected to pay. It also helps to solve the problem outlined particularly by the noble Lord, Lord Young of Cookham, about what happens to these orphan buildings when the waterfall runs out of people to fall on. I have suggested in Amendment 200 that we establish a leaseholder protection fund. I do so because, as noble Lords across the House know, there is an absolute determination on the part of all noble Lords who have spoken so far that, whatever else happens, the leaseholders will not, and should not, be the ones who pick up the bill for the errors of others—errors which are sometimes deliberate. Amendment 200 takes a slice of the building safety fund which the developers are providing, and it establishes a fund for leaseholders who are left carrying the can, either through the orphan building situation—as described by the two previous speakers—or if the cap which we will discuss in group 7 remains. In both cases, it achieves the same end: there is a fund to which leaseholders can apply for funding to offset the bills they are presented with for work for which they have no responsibility and should never be asked to pay. This is the aim of Amendment 200, and I hope that one of the other amendments deals with this because, as far as I am concerned, this is a backstop. I assume that one of the other amendments will get the majority support of your Lordships’ House, and I will therefore not press this particular amendment.
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Lord Blencathra (Con)My Lords, it is a pleasure to follow the noble Baroness. I particularly like her slogan, “Get the work done.” Somehow i…
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Lord Blencathra (Con)Conservative
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My Lords, it is a pleasure to follow the noble Baroness. I particularly like her slogan, “Get the work done.” Somehow it reminds me of a similar slogan we heard rather successfully a couple of years ago: Get Brexit done. I am glad that the Liberal Democrats are picking up some Conservative slogans.
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Baroness Pinnock (LD)I think it is the reverse.
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Baroness Pinnock (LD)Liberal Democrat
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I think it is the reverse.
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Lord Blencathra (Con)I support Amendment 233, so ably moved by my noble friend Lord Young of Cookham in his usual erudite way; he had the de…
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Lord Blencathra (Con)Conservative
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I support Amendment 233, so ably moved by my noble friend Lord Young of Cookham in his usual erudite way; he had the detail but was still succinct. Because he set it out so well, I can be commendably brief, for a change. I start from the position of my right honourable friend Michael Gove, and I totally support what he has said and done. I usually support what he says and does, except when he was Conservative Chief Whip and was a bit cuddly, caring and too kind. But apart from that, I liked it when he said that “leaseholders are shouldering a desperately unfair burden. They are blameless, and it is morally wrong that they should be the ones asked to pay the price. I am clear about who should pay the price for remedying failures. It should be the industries that profited, as they caused the "problem, and those who have continued to profit, as they make it worse.”—[Official Report, Commons, 10/1/22; col. 284.] You cannot say better than that. So I am rather sympathetic to any amendments, including the one moved by the noble Earl, Lord Lytton, trying to make sure that developers or perpetrators pay every penny. It should not be leaseholders and, ideally, it should not be the taxpayer. However, this amendment creates a remediator of last resort and allows the Secretary of State to step in and undertake the works. In either case, it would allow the Secretary of State or the local authority to pursue the responsible developer with debt claims to recover the money laid out on remedial works. As my noble friend so ably said, that ensures that there is a failsafe mechanism in the law. The Government’s legislative proposals do not tell us what will happen if remedial works are simply not started or cannot be completed as a result of the effect of the caps imposed in the Bill and the restrictions on buy-to-let landlords. The duty in this amendment would fill the gap. The Government’s proposals would require some sort of remediator of last resort. Because they are imposing caps on what can be collected toward non-cladding costs, the Government are creating a gap in funding, which will have to be plugged somehow. Ultimately, someone is going to have to pay; otherwise, as my noble friend said, buildings will never be fixed. This amendment allows building work to be started and buildings to be fixed, with the taxpayer providing a form of bridging finance—but they must get that money back from the building safety fund; this is not carte blanche to make the taxpayer pay for these things. As I said, I am sympathetic to the amendment from the noble Earl, Lord Lytton. I just worry that if we adopted these four or five new clauses, we might be tearing the guts out of the Bill and would have to rewrite a lot of it. But I think his heart is in the right place in where he is aiming to go. I understand that my noble friend might be worried about the legal position under the ECHR. This is another area where the noble Earl’s amendments might technically fall foul of the ECHR. Some of us have seen legal advice circulated from Daniel Greenberg, who is well known to everyone in this House. He says: “On the basis of this analysis, l am satisfied that the draft clauses are compatible with the Convention rights and that Ministers will be able to comply with Section 6 of the Human Rights Act 1998 (Acts of public authorities: duty not to act incompatibly with ECHR) when they come to perform the functions conferred by the draft clauses”— referring to draft Clauses 234 to 237. I am not capable of suggesting whether Daniel Greenberg QC is correct or not, but I would love to hear what the Minister has to say about that. If the amendments from the noble Earl, Lord Lytton, are not right, it would be helpful to hear from my noble friend how far they can go towards what the noble Earl is trying to achieve. If he is going to reject them, I would love to hear how far he can push to get as close as possible to the noble Earl’s position. With those words, I am content to support my noble friend’s Amendment 233, and I would love to hear explanations on the noble Earl’s amendments.
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Baroness Neville-Rolfe (Con)My Lords, I apologise for a brief Committee-style intervention, given the novel nature of the group of amendments we ar…
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Baroness Neville-Rolfe (Con)Conservative
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My Lords, I apologise for a brief Committee-style intervention, given the novel nature of the group of amendments we are looking at. I have two points. First, I am very grateful for the agreement earlier to the amendment from the noble Lord, Lord Best. I thank my noble friend for that but, as he knows, I am concerned about the position of leaseholders who are also involved in the hard task of managing even a small development as an enfranchised leaseholder. I have a family member with an interest in that area. What happens if a cladding or other building safety issue arises? I know that such leaseholders may face big bills and responsibilities. Amendments 186 to 193 appear to make enfranchised leaseholders of this kind liable even if they have ceased to act or sold out and become previous landlords. Have I understood this correctly? If I have, then it undermines the case for enfranchisement that has been encouraged by successive Governments to get rid of excess service charges. Secondly, a strong case has been made for the non-government amendments in this group. I too have received many worrying letters from leaseholders. Do we have a feel for the cost, especially the net cost, of these Back-Bench amendments we are debating? I feel this is a matter that will be of concern in the other place, given current fiscal pressures, and might therefore determine what is eventually agreed in this important and urgent Bill.
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Baroness Hayman of Ullock (Lab)My Lords, this has been a very interesting debate so far. In the interests of time, I will just speak to the two amendm…
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Baroness Hayman of Ullock (Lab)Labour
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My Lords, this has been a very interesting debate so far. In the interests of time, I will just speak to the two amendments I have in this group, and then I will be very interested to hear the Minister’s response to the broader debate and issues that have been raised, that were clearly also debated in Committee. Amendment 231 is about a registered social landlord not being able to “use the income from rents or service charges to rectify defects relating to external wall systems or compartmentations where those defects result from the construction of the property or the installation of the external wall systems.” The amendment would prevent local authorities using rental income or service charges to pay to remediate dangerous cladding or other fire safety defects. The aim is to give social housing tenants the same protection as leaseholders. While we support the Government’s efforts to protect leaseholders from the cost of remediation, the arrangements currently being considered by Ministers will mean that the cost of remediating social housing blocks falls on housing associations and council housing revenue accounts. In the case of council housing, the main sources of income within the HRA are from tenants, in the form of rent and service charges. If the cost of fixing council housing falls on the HRA, then either rents, service charges, or potentially both, will need to increase, or maintenance improvement of social housing as well as new social housing delivery will need to be cut back. That is our concern. We clearly support the protection of leaseholders, but the protection of home owners who will eventually make a profit from the sale of their property, cannot and must not come at the expense of social housing tenants. Our proposal would prevent that outcome and instead require the Government to protect tenants such as leaseholders by requiring the industry to pay, with the taxpayer as a fallback provider of funds in recognition of any failings that created this crisis in the first place. We discussed my Amendment 22 in Committee. It states: “The regulations must exempt any relevant application made by or on behalf of a registered social landlord for the provision of social housing as defined under section 68 of the Housing and Regeneration Act 2008.” The purpose behind this is to make social housing providers exempt from the additional financial burden of the Government’s proposed levy in order to prevent council tenants effectively subsidising the failures of private developers. Clause 57 of the Building Safety Bill gives the Secretary of State powers to impose a new building safety levy in England. This will contribute to government costs for remediating historical building safety defects and will apply to developers making application to the building safety regulator for building control approval. This is the new gateway 2 system, which will be introduced in building regulations.
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Lord Greenhalgh (Con)I thank noble Lords who have spoken in this long—a little over an hour on one group—but important debate on ensuring th…
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Lord Greenhalgh (Con)Conservative
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I thank noble Lords who have spoken in this long—a little over an hour on one group—but important debate on ensuring that the polluter pays. I thank the noble Baronesses, Lady Hayman and Lady Pinnock, for Amendment 22, on the levy on social housing. The noble Baroness, Lady Hayman, raised the issues of exemptions from the building safety levy for social housing providers and who the details of the buildings levy will apply to in secondary legislation. I am pleased to inform the noble Baroness that we are considering an exemption from the levy for affordable housing as a whole, including social housing, housing for rent or sale at least 20% below market rent or sales rates, and shared ownership. The Government recognise that applying a levy to affordable housing would increase the cost of developing affordable housing and would therefore be likely to disincentivise supply, as the noble Baroness said. We consulted on this exemption for affordable housing in our consultation on the levy, which ran from July to October last year. I hope the noble Baroness understands that her suggestion is under careful consideration and will be addressed in secondary legislation. I will probably have to roughly translate: she should be reassured that the building safety levy will not apply to public housing. That probably makes it a little easier for her to decide what she wants to do. I turn now to Amendment 200, on the leaseholder protection fund, tabled by the noble Baroness, Lady Pinnock, and the noble Lord, Lord Stunell, which would require the Government to use funds raised by the levy to refund leaseholders who have already paid for safety works. While a noble thing to do, the Government’s primary aim is and should be to protect leaseholders from building safety risks and enable work to be undertaken to ensure this. For this reason, we will not be able to accept the amendment. On Amendment 221, I thank the noble Baroness, Lady Pinnock, for this amendment. We share her determination to make sure that the industry acts now to take responsibility for fixing building safety defects and that the burden should not fall on leaseholders or taxpayers. The whole tone of the amendment is to get on with remediation and I have great sympathy for that. The principal objective of Clauses 128 and 129 is to make sure that responsible parties pay and to enable us to hold the industry to account. The further amendment I spoke to earlier will make it clear that we can link the scheme to the planning system. Together, these powers will allow us to monitor compliance of members of the responsible actors scheme and make sure that members take responsibility and act promptly to make buildings safe. We do not believe a 5-year deadline needs to be inserted into the Bill. Our intention is for the measure to achieve its objectives much more quickly. Those that do not meet the scheme conditions may lose scheme membership and may immediately be subject to the planning prohibition, as our amendments make clear. A focus on pace is already built into the Government’s approach. I hope this reassures the noble Baroness that her intention has been more than met by the Government through this Bill, just in another way. I turn now to Amendment 231 on social landlords and defects, tabled by the noble Baronesses, Lady Hayman and Lady Pinnock. The Bill already makes provision to protect leaseholders from unreasonable costs and allow guilty parties to be pursued. It contains a requirement on landlords to take reasonable steps to pursue other cost recovery avenues before seeking to recover the costs of remediation works from leaseholders. They need to provide evidence to the leaseholders of the steps taken. Social landlords will have to undertake these measures, including pursuing construction companies or installers where applicable. To help all landlords, including social landlords, the Government are bringing forward an ambitious toolkit of other measures to allow those responsible to be pursued. This includes extending the limitation period under Section 1 of the Defective Premises Act 1972 to apply retrospectively for 30 years. We are also allowing the High Courts to extend the reach of civil liability to associated companies and creating a new cause of action. This will allow manufacturers, distributors and sellers of construction products to be pursued where defective or mis-sold products have been used in the construction of a dwelling, or where further works are carried out to that dwelling, rendering it unfit for habitation. These amendments make it easier for those affected to force those responsible for defective buildings—developers and construction products manufacturers—to pay. While we are making it easier to pursue third parties, in parallel, we continue to protect leaseholders, so they are not paying for unreasonable remediation costs. The Bill introduces new statutory provisions which provide that cladding remediation costs cannot be passed on to qualifying leaseholders in buildings over 11 metres. The law is already clear that service charges and any increase in cost must be reasonable. Finally, the Government set a rent policy for social housing which determines the maximum amount of rent that social tenants may be charged and the maximum amount by which rents may increase each year. The rent standard prevents unforeseen hikes to tenants’ rents and is enforced by the Regulator of Social Housing. Turning now to Amendment 232 in the name of the noble Baroness, Lady Pinnock, and the noble Lord, Lord Stunell, the service charge is the means by which fire safety costs would be recovered and the leaseholder protections measures already prevent costs being passed to leaseholders above the permitted maximum. I now turn to Amendment 233, tabled by my noble friends Lord Young of Cookham and Lord Blencathra, which seeks to impose a duty on local authorities to pursue responsible developers. It imposes requirements on local authorities to remediate buildings with defects and to recover funds from responsible parties. If no funds can be recovered, the Secretary of State would be required to reimburse the local authority. We have been clear that industry is responsible for remediating defective buildings. We expect developers to remediate buildings they had a role in developing or refurbishing. Where this does not happen, building owners and landlords will have new powers to pursue those responsible. Local authorities will also have powers under our new remediation orders and remediation contribution orders, as will other regulatory bodies. However, to impose a duty on local authorities to fix buildings or pursue responsible parties is not the right approach. This would absolve industry of its duty to resolve the crisis and building owners and landlords of their responsibilities to make buildings safe. It would also place an unacceptable burden on the taxpayer. The amendment seeks to create a taxpayer backstop by requiring the Secretary of State to reimburse local authorities for costs they cannot recover. We have been very clear that it is wrong to look to the taxpayer for further funding to fix defective buildings. For these reasons, we will not be able to accept the amendment. I want to deal with the specific issue of the remediator of last resort. I understand where my noble friend Lord Young is coming from. We have asked the industry to provide a fully funded solution for both the cladding and non-cladding costs, including fixing their own buildings and contributing to a fund for the very orphan buildings he has highlighted of between 11 and 18 metres that need cladding remediation. The focus of the industry is on fixing its own buildings, and therefore we can begin to be more focused on where we apply taxpayer funds. Finally, I address Amendments 201, 202, 229, 234, 235, 236 and 237 in the name of the noble Earl, Lord Lytton. Amendments 201 and 202 would hold the Crown liable where properties escheat—that is probably not the right pronunciation—and would prevent liquidators and trustees in bankruptcy renouncing the leases of buildings with fire safety defects. The Bill already prevents freeholders evading liability by simply escheating their properties where they do not want to pay. It also makes provisions in relation to insolvency and bankruptcy. Freeholders will still be liable where they were, or were connected to, the developer, or had a net worth over £2 million per in-scope building on 14 February. As I have said before, taxpayers should not be held liable. For this reason, I will not be able to accept these amendments. Amendment 229 is unnecessary as landlords are already prevented from passing on costs unless they have explored all other routes of funding. I turn to the important Amendments 234 to 237. These cover building safety cost orders, providing powers to make regulations, stipulating liability and establishing a building safety cost fund. Liability for remediation costs is already set out in the Bill, as are provisions for building owners and landlords to go after associated developers, companies and manufacturers of defective products. For this reason, I will not be able to accept these amendments. My noble friends Lady Neville-Rolfe and Lord Young of Cookham raised the position of enfranchised leaseholders and asked whether we have made life harder for them via Amendments 186 to 193. I want to be absolutely clear that nothing in the amendments increases liabilities for enfranchised leaseholders. No leaseholder will be worse off; all are measures to make the polluter pays principle apply to enfranchised leaseholders. I hope that I have gone some way to provide assurances on the Government’s approach.
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Lord Young of Cookham (Con)Before my noble friend sits down, I am really grateful to him for the explanation he has set out but can he tell the Ho…
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Lord Young of Cookham (Con)Conservative
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Before my noble friend sits down, I am really grateful to him for the explanation he has set out but can he tell the House what happens where there is a building and no one has any money— the leaseholders cannot afford it, there is no freeholder and there is no developer or contractor to pursue? Who then puts that building right?
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Lord Greenhalgh (Con)My Lords, in practical terms, we have a £5.1 billion fund, of which we have committed the first stage of £1 billion. We…
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Lord Greenhalgh (Con)Conservative
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My Lords, in practical terms, we have a £5.1 billion fund, of which we have committed the first stage of £1 billion. We have an additional £4.1 billion for buildings over 18 metres and an additional £4 billion for cladding remediation, yet we are asking industry to fix its own buildings. That gives us the ability to focus on the few buildings my noble friend is talking about, because we have got the developers that built these buildings to go on and fix them in a proportionate way and we do not have to use the core of money that we already have. Noble Lords can test the opinion of the House, but that is a practical way of dealing with the problems—focusing the current funds on those few buildings where that scenario applies.
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Baroness Hayman of Ullock (Lab)Before the Minister sits down, I thank him very much for his response to my Amendment 22. Could he just clarify somethi…
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Baroness Hayman of Ullock (Lab)Labour
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Before the Minister sits down, I thank him very much for his response to my Amendment 22. Could he just clarify something, so that I am completely clear on it? Was he saying that the Government will exempt social housing from the levy and that an SI will be brought in? If I am correct in my understanding, I would be grateful for a meeting to discuss the detail of what he proposes will happen.
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Lord Greenhalgh (Con)My Lords, I thank the noble Baroness, Lady Hayman of Ullock, for the opportunity to clarify what I meant. In simple ter…
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Lord Greenhalgh (Con)Conservative
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My Lords, I thank the noble Baroness, Lady Hayman of Ullock, for the opportunity to clarify what I meant. In simple terms, the exemption applies to social housing. With regard to how that is implemented and the means by which we do that, I will be happy to meet the noble Baroness to set out formally how we intend to bring that forward. I have already made that comment in meetings before Report, so it has been made in public. I am happy to make that commitment on the Floor of the House and to work on how we implement that and set it out, either in writing or in a further meeting.
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Baroness Hayman of Ullock (Lab)I am very happy to accept the Minister’s assurance on this if we can have a meeting to follow up.
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Baroness Hayman of Ullock (Lab)Labour
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I am very happy to accept the Minister’s assurance on this if we can have a meeting to follow up.
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Baroness Fox of Buckley (Non-Afl)I thought we were going to have a vote.
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Baroness Fox of Buckley (Non-Afl)Non-affiliated
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I thought we were going to have a vote.
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Lord Greenhalgh (Con)We surprised the noble Baroness.
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Lord Greenhalgh (Con)Conservative
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We surprised the noble Baroness.
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Baroness Fox of Buckley (Non-Afl)I am not ready.
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Baroness Fox of Buckley (Non-Afl)Non-affiliated
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I am not ready.
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Baroness Fox of Buckley (Non-Afl)Your Lordships need to calm yourselves. On Saturday, I went to visit my home in Wood Green. It looks like a bomb site:…
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Baroness Fox of Buckley (Non-Afl)Non-affiliated
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Your Lordships need to calm yourselves. On Saturday, I went to visit my home in Wood Green. It looks like a bomb site: there is no roof and there are huge amounts of scaffolding and barbed-wire fences surrounding the block of 25 two-floor maisonettes. When you arrive, you see a huge multicoloured fluorescent sign with the words “Zero tolerance” and then a list of prohibited activities, all relating to safety: “Safety helmets must be worn”; “Safety footwear must be worn”; “No smoking”; “Danger: tripping hazards”; “Danger: men working ahead”; “Danger: no children on the site”. We are told that “Safety signs and procedures must be observed.” I therefore know, having visited my home in Wood Green, that Haringey Council is definitely keen on promoting safety. Let us consider this. My home is in this state because, two years ago, there was a fridge fire in one maisonette. The roof of the block caught fire and the other flats, including mine, were drenched by the fire brigade in putting out the fire. It was not too bad and, to be honest, we were so glad that no one was hurt and we were relieved to get out safely. But that was two years ago this month—two years in which 25 families have been effectively homeless. As a leaseholder, the council, which is my freeholder, took my front door key off me—it is not a glamorous house, by the way, but it is mine, or so I thought—and basically said that I would get it back when the block had been made safe. It is now two years later and I am still not back, and I have no idea when I can go home. I have mentioned this story before. My retelling it is not therapy but to show how what starts as an unremarkable but unpleasant event—a fire, albeit in lockdown—can escalate and turn into a nightmarish, never-ending misery for so many people. At every turn, as leaseholders and tenants, we have been faced with layers of bureaucracy getting in our way, more and more people to deal with, more and more issues being raised to explain why we are not returning home, and dwindling effectiveness in getting our homes back to us. We leaseholders and council tenants have been shown a certain indifference to our plight. If I am honest, all that has been much worse than the original fire, but it is okay because Haringey Council has put up lots of safety signs. Safety trumps all, and is used to say to us, “Shut up and put up.” I arrived at this place during the time of my eviction from the house and was inspired by the right reverend Prelate the Bishop of St Albans and the noble Baroness, Lady Pinnock, whom I heard speak on what was happening to leaseholders. I thought, “I’m going to join that debate.” I was inspired by their dedication and what they said, and that is how I ended up here. The moral of this tale is that I want to make sure that the Bill, which is well-intentioned on safety, does not in the name of safety end up with the unintended escalation of a whole new set of problems for leaseholders, which was the point of the analogy with my flat fire. The amendment—I actually prefer a similar but better amendment from the noble Baroness, Lady Neville-Rolfe, who is trying to do the same thing—would require the Government to commit to review the impact of the legislation in a couple of years. It says to the Government, “Can you just check in all instances that the legislation doesn’t cause more problems and is actually doing what you want it to do, or what we in the House have been told you want it to do?” We are rather rushing through the Bill. Whole swathes of new amendments have emerged. These have been put in not necessarily by noble Lords but by the Government. I was happy to hear the Minister explain that there are so many amendments because he, the Secretary of State and the department are listening. But whatever way you look at it, we, as people scrutinising the Bill, are being presented with hundreds of amendments that have been quite hard to get one’s head round in the time. In many ways, the Bill is not being fully scrutinised line by line. As the noble Lord, Lord Jordan, put it, it really is a legislative quagmire to wade through and it is very difficult. It has been almost impossible to read the amendments, assess what their nuances mean and look for what the consequences might be. I appreciate that that is for me and that I am a lay person on technicalities, but luckily, as has been mentioned, leaseholders have a few important voluntary heroes who have helped the rest of us through. I know that the lawyer and leaseholder Liam Spender has already been name checked for his multicoloured sheet, which has already been shown, but if noble Lord have not seen it is well worth studying because it really does explain things. There are also all sorts of reporters for the Leasehold Knowledge Partnership and intrepid leaseholders doing their own work, trying to get to grips with what all these new amendments and the Bill mean. I mention that because it would be irresponsible if we passed this Bill and then let it sail off into the distance without any idea that it will be looked at again. I worry that the Government think that all will be solved once the Bill has passed. I do not want hostages to fortune. We have had lots of reassurances today, we have been told not to worry and have had great rhetoric from the Government on proportionality and common sense, but we therefore need to be able to check that that rhetoric will be fulfilled. Finally, this is not all about leaseholders. My hunch is that the Bill has a range of problems because it has gone along uncritically with the picture painted by Dame Judith Hackitt that somehow every aspect of living in a flat should be seen as a potential hazard and a dangerous fire risk. For the last few years—understandably because of Grenfell—there has been a sort of hyperactive “something must be done” mentality that has led to the EWS1 crisis and caused many of the issues that informed the discussion on the previous group of amendments on innocent victims paying for excessive remediation. All I ask is that this review checks that an overzealousness does not emerge from the legislation that skews priorities and means the Government’s valiant efforts at common sense and proportionality somehow end up in a proliferation of chunky formalised procedures. I will also reflect on the other people we should bear in mind. I have emphasised leaseholders throughout this contribution, but in my Second Reading speech I also talked about the construction industry. I want to make sure we do not end up stymying the house-building programme through overregulation. There is a danger that, as we have heard in some of the contributions, we describe the construction business as though they are all cowboy builders, which is a rather insulting caricature. With another hat on, at another time, I would be saying the big crisis in this country is a lack of housing and we need to “Build, build, build”, so I get worried when the Home Builders Federation says that it is concerned that there will be difficulties with housing delivery if too much of a burden is put on housebuilders. You might say, “I am not going to feel sorry for them,” but we do not want to get ourselves into a situation where the extraction of funds from the construction industry means that the UK home building industry—which is important to many parts of levelling up, social equality and so on—is stymied. One way or another, I can think of nothing more sensible for a common-sense Minister than to say, “In a couple of years, we’ll review all this and check that your hunches are wrong, Lady Fox.” That will be fine. The Minister referred to me earlier as Oliver Twist—always wanting more. This is only a little bit more, but you cannot change the world unless you want more, and I intend to demand a lot more, but only a little more in this Bill. I beg to move.
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Baroness Neville-Rolfe (Con)My Lords, I rise to speak to my Amendment 264A in this group. I thank my noble friend the Minister, as others have done…
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Baroness Neville-Rolfe (Con)Conservative
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My Lords, I rise to speak to my Amendment 264A in this group. I thank my noble friend the Minister, as others have done, for all he has done to make this Bill a reality. The object of the Bill, as I see it, is to get defects remediated to a proportionate extent as quickly as possibly—mainly cladding, sometimes installed, ironically, to improve insulation in the interests of carbon reduction, but also other unsafe matters. There have turned out to be more defects than anticipated and we have witnessed an unfortunate record by builders and others of not doing enough to put matters right. The Bill seeks to get things remedied quickly. However, it is costing an eye-watering amount to home owners, leaseholders and the Exchequer, and the Bill therefore also seeks to establish an equitable share-out of the costs including appropriate contributions by the supply chain. It is a long saga and some of us in this House have been seeking solutions for a very long time and welcome the principle of legislation. However, unusually, the Bill has been changed completely by government amendments tabled since it left the House of Commons, yet we have not had an updated impact assessment to help us assess the costs and benefits of the revised proposals. This is poor, given the financial and other burdens on different stakeholders, as the noble Baroness, Lady Fox of Buckley, has just explained. However, as the chair of the Built Environment Committee I welcome today’s concession from the Minister on social housing, which I hope will be less costly, as it will give welcome clarity. I have a great deal of respect for the Health and Safety Executive, as I have said before, and for the Minister who has fought so hard to present credible, effective and sensible proposals. However, it has been a rush, and I believe we must have a review clause in the Bill beyond the five-year independent review in Clause 152, and with more teeth. The noble Baroness, Lady Fox of Buckley, has constructively proposed one option; I hope my version may recommend itself to colleagues across the House and to my noble friend. I believe that agreeing to this could help to narrow current, very real, differences on the Bill particularly in the next group of amendments. I will explain why. I am proposing a review within two years. It would look at the impact of the provisions of the Act. If the review found that there were serious problems for leaseholders, for home owners who could not buy or sell property, or for any other group, it would make recommendations.
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Baroness Bennett of Manor Castle (GP)My Lords, I rise with pleasure to follow the noble Baroness, Lady Neville-Rolfe. I agree with almost everything she sai…
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Baroness Bennett of Manor Castle (GP)Green Party
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My Lords, I rise with pleasure to follow the noble Baroness, Lady Neville-Rolfe. I agree with almost everything she said and very strongly back her amendment. The political spread we have just achieved across the House in that regard is interesting. I sat through the previous group, and I am indebted to the noble Baroness, Lady Pinnock, for counting the 70 amendments in it. I listened to the detailed and informative contributions, particularly from the noble Lord, Lord Young of Cookham, and the noble Earl, Lord Lytton. I learned a great deal about waterfalls. I am still not entirely convinced that there is a solution to the “if no one’s left to pay who’s going to pay?” problem. None the less, it is very clear that this is an unusual Bill and that we have very broad agreement on what we are trying to achieve; that is, that the perpetrator pays to ensure that innocent leaseholders and home owners who through no fault of their own have found themselves trapped in awful, incredibly stressful, dangerous circumstances are not the ones who ultimately suffer and that the people who create the problem pay for it. However, given the complexity of everything we have just done, we cannot be sure that the Bill will deliver and that there will not be unexpected hitches and problems along the way. I agree with the noble Baroness, Lady Neville-Rolfe, that five years is just too long. The noble Baroness, Lady Fox, spoke about the personal experience of being stuck out of a home, and some people are stuck in homes in awful situations. Two years is the right time to look at this in the round. This may be where I slightly part company with two earlier speakers. I think there is broad agreement that we have a huge cultural problem in the building industry. I should perhaps declare a historic interest as the daughter of a builder. I knew quite a bit about the Australian building industry and lots of the problems that I saw in that situation have been magnified and intensified by economic developments over the past few decades. We have mass housebuilders that are far better at being cash cows than at producing homes. We are trying to change this situation and the whole culture of the industry. We are trying to get homes that are produced so that people have a secure, stable, affordable place to live. It is such an enormous change that we cannot wait five years to review this, so I commend the amendment tabled by the noble Baroness, Lady Neville-Rolfe.
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The Earl of Lytton (CB)I, too, commend the noble Baroness, Lady Neville-Rolfe, on this amendment. Given the circumstances of the Bill, the num…
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The Earl of Lytton (CB)Crossbench
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I, too, commend the noble Baroness, Lady Neville-Rolfe, on this amendment. Given the circumstances of the Bill, the number of variations in it and the sheer number of moving parts involved, a review is essential for precisely the reasons she said, and I support the amendment.
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Lord Greenhalgh (Con)My Lords, I am grateful to the noble Baroness, Lady Fox of Buckley, and my noble friend Lady Neville-Rolfe for this ins…
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Lord Greenhalgh (Con)Conservative
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My Lords, I am grateful to the noble Baroness, Lady Fox of Buckley, and my noble friend Lady Neville-Rolfe for this insightful debate. Amendment 26 from the noble Baroness, Lady Fox, would require a review of the financial impact of the new regime. I reassure the noble Baroness that a review is already required by Clause 152, which provides that: “The Secretary of State must appoint an independent person to carry out a review of” the system of regulation of building safety and standards and the system of regulation for construction products. Importantly, the reviewer is not limited and may choose to review connected matters, including the matters mentioned in the noble Baronesses’ amendments. Similarly, Amendment 246A in the name my noble friend Lady Neville-Rolfe would require a review of the impact of the Act. I apologise for the mix-up that resulted in my addressing this amendment in an earlier group. I will repeat for the record that we believe that this further replicates Clause 152 in the Bill and therefore we believe this is unnecessary. What I do say to my noble friend is that the Secretary of State has to appoint someone to carry out the review within five years, so that is a long-stop date. I am very happy to meet my noble friend to ensure that we get going with this review at the very earliest opportunity to make sure that that long-stop date is comfortably met. We also need to make sure that this review is substantive and learns the lessons of a new regime in the broadest possible sense and addresses the points raised by the noble Baroness, Lady Fox of Buckley, as well those raised by my noble friend Lady Neville-Rolfe, who has had tremendous Front-Bench experience as well as experience as a distinguished civil servant. With those explanations, I kindly ask the noble Baroness, Lady Fox, to withdraw her amendment and my noble friend Lady Neville-Rolfe not to press her amendment.
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Baroness Fox of Buckley (Non-Afl)I will withdraw but I will come back to the Minister. I think it is important to come back to the Minister and say if i…
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Baroness Fox of Buckley (Non-Afl)Non-affiliated
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I will withdraw but I will come back to the Minister. I think it is important to come back to the Minister and say if it is within five years, I would like it to be brought forward sooner. I do not know why he does not just accept the two years but let us have the meeting to discuss it. At this point, I will not press the amendment and beg leave to withdraw.
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Baroness Brinton (LD) [V]My Lords, this amendment was debated earlier. I just want to repeat the point I made then that I thank the Minister for…
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Baroness Brinton (LD) [V]Liberal Democrat
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My Lords, this amendment was debated earlier. I just want to repeat the point I made then that I thank the Minister for the offer of the meeting tomorrow. If we have not made some progress on the issue of PEEPs and safety for disabled people, I will bring back an amendment at Third Reading but, in the meantime, I beg leave to withdraw.
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Lord Greenhalgh (Con)I am very pleased to move a group of amendments that are focused on ensuring that leaseholders are protected from costs…
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Lord Greenhalgh (Con)Conservative
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I am very pleased to move a group of amendments that are focused on ensuring that leaseholders are protected from costs related to historical building safety defects. The package of leaseholder protections eradicates the idea that leaseholders should be the first port of call to pay to fix historical building safety defects. In fact, in drafting these clauses we started with the presumption that leaseholders should not have to pay anything, a sentiment that I know is shared with noble Lords from all sides of this House. It is only right that building owners and landlords share in the costs of fixing dangerous buildings and we have carefully engineered—
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Lord Cormack (Con)I was under the impression that this was grouped with a whole group of amendments that had been debated and therefore t…
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Lord Cormack (Con)Conservative
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I was under the impression that this was grouped with a whole group of amendments that had been debated and therefore there was no need for a further debate. If I am wrong, of course I apologise.
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The Deputy Speaker (Lord Duncan of Springbank) (Con)I will take the blame for that. I should have said moved formally and that would have encouraged the noble Lord, Lord G…
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The Deputy Speaker (Lord Duncan of Springbank) (Con)Conservative
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I will take the blame for that. I should have said moved formally and that would have encouraged the noble Lord, Lord Greenhalgh, to say “moved formally”. I will accept the admonition on that point. The noble Lord has saved the House some considerable time because I can see the page of that speech now fluttering in the wind.
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Lord Greenhalgh (Con)Moved formally.
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Lord Greenhalgh (Con)Conservative
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Moved formally.
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The Earl of Lytton (CB)My Lords, this amendment is leading the charge here. I refer noble Lords to Grand Committee, when the noble Lord, Lord…
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The Earl of Lytton (CB)Crossbench
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My Lords, this amendment is leading the charge here. I refer noble Lords to Grand Committee, when the noble Lord, Lord Blencathra, in particular, questioned why only buildings of a certain height benefited from the cost protections in this Bill. This is a matter on which I feel very strongly—and, indeed, both my cosignatories feel strongly—and I give notice that I may well press the amendment to a Division. I reminded the Grand Committee at the time that building safety is not governed by building height alone or, possibly, at all. I refer to the fire at Worcester Park in September 2019. The Minister went on to give us a graphic description of the circumstances. However, despite that the Minister stuck to his text in suggesting that lower rise buildings do not have the same risk profile. I have probably paraphrased him, and that may not be the precise form of words that he used, but that is the drift of what he was saying. If, as he recounted in the circumstances of the Worcester Park fire, it was so well alight after nine minutes that the fire and rescue services concluded that the building could not be saved, that represents to me an existential risk to occupiers who may be asleep, confused of mind, infirm, pregnant, disabled or otherwise particularly vulnerable, especially as regards the speed with which an inferno can evidently develop. A block of flats without adequate separating walls to me is just as dangerous above ground-floor level as a high-rise block without decent fire doors. I do not make a distinction in terms of risk; they are both equally perilous, as far as I can see. Be that as it may, I have received emails from occupiers of identical buildings in the same development in the Worcester Park building, telling me that the developer was remarkably reluctant to address basic issues and shortcomings, many of which may have accelerated the fire in the building that was actually destroyed. Furthermore, they said that they could not sell their flats and that insurance had gone through the roof, and interim measures were costing a fortune—exactly the same problems and privations as with taller buildings. I will just say—other noble Lords will be able to elaborate—that the Government have not made the case for excluding these, other than giving the impression that this is driven, dare I say it, by a degree of Treasury parsimony and a departmental inclination to go no further than it absolutely has to. There seems no good reason for height exclusion on any moral, economic, safety or practical ground. I beg to move.
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Lord Young of Cookham (Con)My Lords, as noble Lords may know, I am not in the habit of making long speeches, but this group of amendments covers a…
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Lord Young of Cookham (Con)Conservative
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My Lords, as noble Lords may know, I am not in the habit of making long speeches, but this group of amendments covers a huge range of issues and is arguably the most important group today. I am proposing seven amendments and I have added my name to four others. I will be as brief as I can, and the good news is that I do not propose to intervene in this debate again. I will go through the amendments in the order in which they appear, starting with Amendment 115, moved by the noble Earl, Lord Lytton, to which I have added my name. It seeks to expand the service charge protection of Schedule 9 to buildings of all heights. At the moment, as we heard, buildings under 11 metres get no help at all from the proposed waterfall. Unless developers agree to fix those buildings voluntarily, or leaseholders are willing to engage in litigation, there is no meaningful help on offer. As mentioned in earlier debates, buildings under 11 metres can be just as dangerous as buildings over 11 metres. The fire at Richmond House, the 9-metre building that burned to the ground in less than 11 minutes in September 2019, shows the dangers. Buildings under 11 metres are excluded, even though they have exactly the same defects, for which leaseholders bear no responsibility at all. They suffer exactly the same consequences as those in taller buildings: unaffordable service charges, repossession and bankruptcy. I see no equity or principle behind this decision, which is there solely to save money. When we asked about this in meetings on the Bill, we were told there was no systemic problem with cladding in these buildings—a statement that brings no consolation to leaseholders, such as this one, one of many who have written to me. The letter says: “I am a leaseholder in a building well under 11 metres. We are three storeys high with 10 flats. We are therefore excluded from any support from the Government, yet our freeholder/managing agent is taking us to court on Friday to ask them to agree to us having to pay for the cost of remediation—a £26,000 service charge in 2022 per leaseholder. We are told the freeholder does not have the means or obligation to pay for these works that we need to reduce the annual insurance premium. We are told that the only way to pay for these works is via the leaseholder and that we will be legally responsible to fund the money and pay it upfront so that the management agent has the means to pay for works.” The letter continues: “I hope the Minister will see fit to bring our needs in line with leaseholders in larger properties and protect us from at least some of the costs that we currently face.” Last week’s Sunday Times had an article showing that, despite what the Government say, buildings under 11 metres remain unsaleable and unmortgageable, as quotes from the major lenders in the article underlined. We were also told that there were not many such buildings. That is good news, but it follows from that that the extra cost of putting this inequity right is so small that I hope the Minister can accept it. I should have said at the beginning that I am grateful to Martin Boyd, Liam Spender and Sue Bright, who in their personal capacity have helped me with some briefing. I turn now to Amendment 117 in my name and those of my noble friend Lord Blencathra and the noble Earl, Lord Lytton. It seeks to expand the service charge protections to enfranchised buildings and buildings where the right to manage has been exercised. This would ensure that all leaseholders are treated equally. It has been the policy of successive Administrations to encourage leaseholders to enfranchise and buy their freeholds, and to move away from a feudal system of tenure. That process began in the 1960s, when leaseholders could buy their houses, and was extended to flats in the 1990s. Since then, there have been other measures to encourage leaseholders to buy their freeholds, with the security of the independence that goes with it, and measures to promote and enhance right to manage. We are promised legislation in the next Session to take this policy forward. Against that background, it would be perverse if the legislation before us today put enfranchised leaseholders in a worse position than leaseholders who are not enfranchised, but that is what Clause 120 does. The Government cannot hope to succeed in encouraging more resident-owned and resident-run buildings unless they treat all buildings affected by fire safety issues equally. As I understand the legislation, once your building is “not relevant”, it in effect becomes a second-class building in perpetuity. I have looked at the government amendments tabled since Committee stage but they seem to make the position worse by confirming that these buildings are excluded. That means that people living in these buildings are being left to fend for themselves, either by undertaking litigation or by recovering what they can from the building safety fund. An excellent article in the recent edition of Inside Housing shows the problem with the fund: “If the rate of remediation through the fund continues at this pace, it will be decades before all blocks receive funds—never mind see work completed.” I hope that my noble friend will be able to confirm what he said in Committee, which appears to contradict what is in the Bill. He said: “My noble friend Lord Young asked the very important question of whether enfranchised properties will have to pay all the costs for remediation. I want to be absolutely clear—read my lips—no, they are not. This will not apply to buildings which have exercised a right to collective enfranchisement, or to commonhold land, which in this case, admittedly, is very few buildings. New subsection (3) in government Amendment 63 is very clear on that point. I am happy to speak to my noble friend afterwards, but I am very clear that they are not expected to shoulder the burden. They are effectively leaseholders that have enfranchised as opposed to freeholders. I hope that helps.”—[Official Report, 28/2/22; col. GC 262.] However, under Clause 20, these buildings are left to fend for themselves if the developer does not pay or if they do not have the wherewithal to engage in litigation against a well-resourced developer. They miss out on the guarantee in paragraph 8 of Schedule 9 that no leaseholder will have to pay for cladding costs, because they do not live in a relevant building. They are not treated as leaseholders but as freeholders. My amendment does no more than achieve the ambition set out by the Secretary of State in another place on 10 January, when he said that “we will protect leaseholders today and fix the system for the future.”—[Official Report, Commons, 10/1/22; col. 286.] Perhaps my noble friend the Minister can confirm that, if you have not enfranchised, you are protected by the caps on what you can pay but, if you have enfranchised, there is no such protection. I hope that my noble friend will look at that again. I turn to Amendment 123 in my name and those of my noble friends Lord Blencathra and Lady Neville-Rolfe. This would change the definition of qualifying leases so that buy-to-let landlords with interests in up to five properties, including their main home, benefit from the leaseholder cost protections in Schedule 9. While we welcome the Government’s movement on this, we would like to go a little bit further. As I mentioned in Committee on 24 February, there are many buildings where flats are owned by buy-to-let landlords. If those landlords cannot pay their share of the bill, it will mean that not all of the money is available to do the works to the whole building and so remediation will not commence, to the disadvantage of all the residents in the block, who will continue to live in unsafe premises. Many landlords hold their buy-to-let properties as part, or in some cases all, of their pension provision. According to data that the Government provided in July 2021 in response to the noble Lord, Lord Carrington, of the 2.2 million buy-to-let landlords paying income tax, 1.5 million—68%—fell within the basic income tax band. This point is reinforced by the recent report on the remediation and financing of building safety work by the Levelling Up, Housing and Communities Select Committee in another place. It said: “Buy-to-let landlords are no more to blame than other leaseholders for historic building safety defects, and landing them with potentially unaffordable bills will only slow down or prevent works to make buildings safe.” It wanted total exemption, but we do not go quite so far. The committee rightly pointed to the kinds of landlord who will be affected: “We heard from landlords who find themselves outside of the scope of the protections, who invested in properties to support their children, to provide income after being made redundant, to help pay for the costs of caring for relatives, or to provide for their retirement, now facing bills they cannot afford. One contributor told us they had invested in flats using compensation from the Criminal Injuries Compensation Authority ‘after the murder of my husband in the 7/7 atrocity’ and now faces ‘vast bills’”. Our amendment would align the provisions of the Bill more closely with the Bank of England’s definition of a portfolio landlord as being one with four or more mortgaged buy-to-let properties across all lenders in aggregate. It would also ensure that most private landlords who are leaseholders would be covered by the Bill. The Government’s most recent English private landlords survey shows that 83% of private landlords rent out between one and four properties. I understand that the Minister has indicated to the National Residential Landlords Association that he might be open to considering a formula which would enable landlords to access support under the government scheme where their portfolio of properties is valued at a certain amount, instead of simply counting how many there are. There are huge variations in the value of property for a multitude of reasons. For example, someone who has 10 other properties may have significantly less means than someone who only owns one property. Yet the government approach will penalise the individual with less means purely because of the number of properties their own. Some buy-to-let owners may have significant equity in their properties while others may be mortgaged to the hilt or in negative equity. The current approach is very crude and does not differentiate between the wealth of those affected, so I wonder whether the Government are considering that option. I move to Amendment 126, which is a technical amendment. At the moment it is not quite clear whether the protections being given to leaseholders can be sold on to future buyers. It is important that that should be possible, in order to get the market moving again. Clause 121 defines a “qualifying lease” as one held by “a relevant tenant”. A relevant tenant must on 14 February this year meet the occupation and property ownership provisions set out in Clause 121. The Government say that this clause allows protection to be passed from someone who qualifies on 14 February to a future buyer, but I am not sure that that is the case because the restrictions the Government are imposing on who can benefit from help, such as those owning more than four buy-to-let properties, depend on the same definition of relevant tenant. If the Government’s view of Clause 121 is correct and the existing wording allows leases with protection to be sold on, the Government may have made a drafting error. If the lease can be sold and the protections passed to a buyer, the characteristics of the buyer are irrelevant. If so, it means someone with 10 flats—six more than the four allowed—could come in, buy up a lease and still get protection. I do not think that is what the Government intend. It is important that we get the market moving, but also that we do not give opportunistic cash buyers the chance to buy up these leases and benefit from protections that other buy-to-let landlords will not get. Amendment 153, which amends government Amendment 152, is technical. Given the passage of time and the fact my notes are in very small print, I think I will pass over that. I turn now to Amendments 157 to 160 and 163, which are really important. They deal with the amount leaseholders have to pay for non-cladding costs. On this, my preference is for Amendments 155 and 156, which mean zero liability; the leaseholder pays nothing. The Government say these caps are necessary because of legal advice. The claim is that to impose measures on developers and landlords, it is necessary for leaseholders to contribute in some cases. As with all legal matters, there appears to be a diversity of opinion among professional lawyers on the Government's judgment that Article 1, Protocol 1 requires leaseholders to contribute anything. But if my noble friend the Minister advises your Lordships that those two amendments—the ones with zero cost—mean that he can no longer assert that the legislation is compatible with the ECHR, then Amendments 157 to 160 come into play and limit the liability. My noble friend Lord Blencathra will speak to Amendment 158.
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The Lord Bishop of St AlbansMy Lords, I will speak to Amendments 260 and 126. I apologise for not being here this morning. I am grateful to the nob…
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The Lord Bishop of St AlbansBishops
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My Lords, I will speak to Amendments 260 and 126. I apologise for not being here this morning. I am grateful to the noble Lord, Lord Blencathra, for speaking to our amendments. Amendment 260 enfranchises leaseholders and brings them closer to the decision-making processes of their building. It ensures that residents of the building are made aware, within the earliest reasonable timeframe, by the responsible person, when they are served any notice given by the fire and rescue service. It also ensures that, when in complying with the notice the responsible person passes costs on to residents, the residents will have 21 days after being informed to appeal this notice to the court. The essence of this amendment touches upon the freeholder’s incentives, as there is no incentive for the freeholder to challenge a notice from the fire service requiring remedial work, since ultimately it is the tenants or the leaseholders who will shoulder these costs. The reality is that freeholders often do not have skin in the game and are more than happy to comply with a served notice, with the full knowledge that they will not be the ones incurring costs for complying with the notice. This amendment is not handing leaseholders the power to indefinitely hold up works necessary for the safety of the building. It is simply providing them, as the ones with real skin in the game, with the right of appeal. I recognise that allowing any individual tenant the right of appeal is messy and may lead to a flurry of unnecessary appeals, which in turn could create unnecessary work when it is least needed. Nevertheless, in principle, leaseholders deserve enfranchisement and mechanisms to challenge decisions that are simply imposed on them. Appeals being done through a representative body—a recognised tenants association, for example—would represent a more sensible position, as that would prevent rogue leaseholders going against the majority to appeal decisions, while at the same time allowing appeals to occur through a body that is both representative and accountable to the leaseholder, and which retains regular communication with the responsible person. I now turn to Amendment 124, in my name and that of the noble Lord, Lord Blencathra. The definition of a qualifying lease and its implications are concerning, as the noble Lord, Lord Young, has pointed out. I am pleased that the Government have extended this definition to three dwellings in total, but it is still problematic. The protections under the waterfall system in Schedule 9 are only available for qualifying leases. Technically, an individual who owns three flats valued at £900,000 per dwelling would meet the cap of £15,000 for remedial costs, whereas an individual with five investment properties in the north of England valued at £200,000 per dwelling would be offered no protection and be liable for the entire remedial costs for each dwelling. Is this not the sort of regionalism that the Government want to avoid in their levelling-up policy? Under the Government’s scheme, the individual, up in the north, for example, whose total property holdings are valued at £1 million, is required to pay for all their remedial costs, whereas their equivalent in London, with total property holdings of £2.7 million, would have their costs capped at £15,000. This example is to make the point that simplistically saying a number, whether it be one, two, four, whatever, for the number of leases allowed under the definition of a qualifying lease, says very little about the value of those apartments. It is evidently unfair that an individual with a much lower portfolio in value might incur much higher costs. I accept the reality that, under any scheme, there will be winners and losers. However, I wonder whether the Government need to go back to the drawing board on how they determine whether a private landlord qualifies under the definition of a qualifying lease, as it is almost entirely void of context. It would be much wiser to determine the definition of a qualifying lease for private landlords based on the value of their entire property portfolio, rather than simply on the number of leases that they own. This point about context brings us to the crux of what Amendment 124 would do, which is to provide some level of security to those receiving a state pension. Young landlords who may fail to qualify under the definition at least have the ability and the time to incorporate this setback into their retirement plans. It does not make it any less painful, but it would at least be a more manageable state of affairs for which they might be able to plan accordingly over many years if they have that time ahead in which to work. Furthermore, it would be assumed that many private landlords would be in receipt of an active income, probably a reasonable income, if they were able to afford multiple leases and not be classed as a qualifying lease. Regardless of whether this means that their exclusion is fair, at the very minimum they have the possibility of greater future earnings. The hope is that those individuals may at least be able to weather these costs in the long run and secure for themselves the financial future they want in retirement. However, pensioners do not have this luxury. Beyond their state and work pensions, savings and any income they get from renting out properties or other dividends, there is almost a negligible prospect of them finding additional ways to raise money. The whole point of planning for your pension is the knowledge that whatever you have in your possession at the point of retirement is what you will be required to live on for the rest of your life. What concerns me is the notion that, as a result of this definition of a qualifying lease, some pensioners who have worked their entire lives and saved and invested diligently so they can enjoy their retirement without financial worry will be suddenly forced to raise enormous amounts of capital to fund remedial works. How does one expect a pensioner to raise such funds? I hope that my concerns are not well founded, but I fear that unless the definition of a qualifying lease makes reference to those on pensions, retirees may find their entire financial life’s work in tatters. I am not a fan of the simplistic way in which the Government are deciding which private landlords do or do not qualify under the definition. However, if I am forced to work within this framework, I think that the provisions contained within Amendment 124, in ensuring that pensioners who own up to six leases in total also fall under the definition of a qualifying lease, are fair ones that protect those who will find it exceedingly difficult to adjust financially to the bills that may come their way. In this vein, I also support the provisions contained in Amendment 123, extending that number of leases up to five. However, I believe even this is a sticking plaster, for the reasons that I have just outlined, as it says nothing about the value of an individual’s property portfolio. I really hope that the Government will be able to do something more on this and, at a minimum, offer some assurances to those pensioners affected that they will not see their life’s financial planning reduced to ruin. More comprehensively, I hope that between now and Third Reading the Government will look at this definition of a qualifying lease for private landlords and how in reality it is to the benefit of private landlords with a few but highly expensive leasehold properties. I am pleased to see Amendments 165 and 165A and their attempt to address the question of how a flat will be valued under the definition of a qualifying lease. However, I express a degree of concern about Amendment 165, as there are leaseholders I have met, not necessarily very wealthy, who purchased a leasehold flat for marginally over £1 million in London only to find that, as a result of requirements to undertake remedial works, the value has dramatically dropped and is now far less than the purchase price. Valuing their flats at the purchase price would likely mean that many leasehold flats which have lost significant value were brought into a cap which no longer reflected their current value. For this reason, I welcome Amendment 165A, as it would force the Government to consider issues surrounding negative equity when drawing up their mechanism to value these leases. I know that the Minister gave some reassuring comments during a meeting we had and hope that he might expand on them today so that leaseholders can be reassured that their leases will be fairly valued. Finally, I support all those amendments in this group seeking to reduce the costs that can be passed on to leaseholders, along with Amendment 115, which would extend the cost protection to leaseholders in buildings of all heights. Taken together, these amendments could provide a package of measures that would deliver justice to those unfairly caught up in this scandal.
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Lord Greenhalgh (Con)My Lords, I was a little slow in rising to introduce the government amendments. I was, perhaps, a little punch drunk af…
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Lord Greenhalgh (Con)Conservative
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My Lords, I was a little slow in rising to introduce the government amendments. I was, perhaps, a little punch drunk after the length of the debate today. It is only right, and I am sure we all agree, that building owners and landlords should share in the cost of fixing dangerous buildings. We have carefully engineered this Bill to ensure that those responsible, and otherwise those with the broadest shoulders, will be the first who are required to pay. Where there is no party that clearly should pay in full, and only in this scenario, our approach spreads the costs fairly and equitably and, above all, ensures that the most vulnerable leaseholders are protected. These measures are a robust and unprecedented legislative intervention, reversing the existing legal presumption that leaseholders must bear the costs of historical building safety defects. The Government have listened to the comments raised by noble Lords, and we have tabled amendments which go even further in protecting leaseholders. Before I set out the detail of these further protections, I would like to be clear that the protections we are putting in place are extensive and, as noble Lords will be well aware, that these must remain in balance with the demands placed on landlords and building owners in ensuring that building safety defects are fixed and paid for where no wrongdoing on their part has taken place. There is an element of fairness here that we need to deliver. The Bill changes the private contract between the landlord and the leaseholder by stating that leaseholders will not pay any costs except in certain circumstances. Government can do this if it is in the general interest to do so, provided there is a fair balance between all the parties. Therefore, we need to make sure that the Bill is both proportionate and fair to all parties. As I have said, leaseholders need to be protected, and we have brought in the most wide-ranging and expansive set of protections ever seen, allowing the courts to look through to associated companies to find both who is responsible and who has funds to remediate properties as there is no point in having money while properties remain unsafe. However, we are also aware that not all landlords were involved with the developer or have deep pockets, and we need to make sure that we consider the issue of building safety from all sides. We have therefore legislated on the side of the landlords by providing numerous robust routes for recovery of funds from those truly responsible: developers and the manufacturers of defective construction products. To be clear, and bearing in mind my noble friends’ proposed amendments, let me put their minds at rest. The Bill makes it very clear that leaseholders will not pay anything in the majority of cases. These are where the landlord is the developer or is linked to the developer, where the landlord is wealthy and, finally, where the leaseholder’s property is valued at less than £325,000 inside London and £175,000 outside. Where these absolute protections do not apply, the leaseholder’s contributions will be heavily capped. On leaseholder contribution caps, it is important to bear in mind that these caps are a maximum that leaseholders can be charged, not a target, and that, as above, they apply only where the landlord is not linked to the developer and cannot afford to pay in full. In addition, costs paid out in the past five years, including for interim costs such as waking watches, will count against the caps. Overall, we consider that in most cases leaseholders will not have to pay the full capped amount and many will pay nothing at all. Nevertheless, the Government agree it is critical that those leaseholders who are least likely to be able to afford to contribute towards historical remediation costs receive the greatest protection. That is why we have tabled amendments to provide that any qualifying lease with a value below £175,000, or £325,000 in Greater London, will be protected from all costs relating to non-cladding defects and interim measures. This is in addition to the protections for cladding remediation costs, which apply to all qualifying leases, and to all leases in buildings owned by or connected to developers. Amendment 164 sets out that the value of a qualifying lease at the qualifying time is to be determined by the most recent sale price on the open market, prior to 14 February this year, uprated in accordance with the UK House Price Index published by the Office for National Statistics. Uprating values for this purpose will be set out in legislation. Amendments 118 and 119 expand the definition of “enfranchised buildings” to ensure that all types of enfranchised buildings are covered. We have listened very carefully to concerns about leaseholder affordability in the small number of cases where leaseholders are paying up to the caps. That is why we have tabled Amendment 166, to double the repayment period from five to 10 years. For leaseholders whose property is not below the threshold and whose building owner or landlord is not liable for the full remediation costs, Amendment 166 will mean that with regard to the capped costs the monthly repayments will be halved. We have also listened carefully to those who were worried about buy-to-let investors who may be holding leasehold properties instead of a pension. As a result, we have amended Clause 121 to provide that people owning up to three UK properties qualify for the protections. As before, the principal home will always qualify, irrespective of how many additional properties are owned. As well as going further to protect leaseholders, we have tabled a number of amendments which add key detail to the measures. We are clear that developers must fix the buildings they developed. That is why we have tabled Amendments 141 to 143 to Schedule 9, which clearly state that, where the landlord is or is linked to the developer, they will not be able to pass costs on to any leaseholder. This includes non-qualifying leaseholders such as commercial leaseholders and those with more than three UK properties. We have also tabled Amendment 145, which extends the definition of a developer to include persons who were in a joint venture with the developer. If you commissioned the work, you will also count as the developer. We have also tabled Amendment 152, which will amend Schedule 9 to provide that where the landlord meets the contribution condition—defined as having a total net worth of more than £2 million per in-scope building as of 14 February 2022—they will not be able to pass any costs on to qualifying leaseholders. The calculation for net worth will be set out in regulations and will take into account parent and associated companies. This will ensure that those who have used complex corporate structures, such as special purpose vehicles, cannot evade liability where they can afford to meet the costs of remediation. We are also amending Clauses 120 and 122 on the definitions for relevant buildings, landlords and works. These amendments will extend provisions to include work undertaken to remedy a defect and will clarify that buildings that are leaseholder-owned are out of scope because, in such buildings, the leaseholders are effectively the freeholders as well. With Amendment 121, we set out how the height of an in-scope building and its number of storeys will be calculated. Amendments to Clauses 122 and 136 cover further definitions, including clarifying that associated partnerships are included, as the noble Earl, Lord Lytton, raised in Committee. Amendment 169 to Schedule 9 inserts a new definition of cladding remediation, which now means the removal or replacement of any part of a cladding system that forms the outer wall of an external wall system and is unsafe. Amendments 170 and 171 provide that the landlord cannot pass on costs to a qualifying leaseholder relating to professional services, in addition to legal costs. Amendment 177 provides that certain leases are taken to be qualifying leases without the tenant providing a certificate, unless steps are taken. It also provides that landlords are taken to have met the contribution condition unless they provide a certificate proving otherwise. This means that the legal burden will be on the landlord to prove that they are entitled to pass on capped remediation costs. The amendments also make minor technical and consequential amendments to clauses to ensure the provisions work as intended, remove extraneous powers and commence the provisions two months after Royal Assent. It is right that leaseholders be protected from extortionate costs of remediating historical building safety defects, in a manner that balances the demands placed on landlords and building owners, where no wrongdoing on their part has taken place. I ask your Lordships to welcome and support this significant and important set of amendments, which go further to protect leaseholders and provide that fair balance.
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Baroness Pinnock (LD)My Lords, this is probably the most important group of amendments we are considering today, because it is absolutely at…
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Baroness Pinnock (LD)Liberal Democrat
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My Lords, this is probably the most important group of amendments we are considering today, because it is absolutely at the heart of the building safety scandal that started nearly five years ago with the loss of 72 people in the Grenfell fire. I always think it is worth remembering that: 72 people died and the lives of many families were changed for ever, and that happened because of systemic and long-term failures in the construction industry. It is also worth remembering that leaseholders since that time have found themselves under the enormous pressure of anxiety when they receive invoices, maybe for £100,000 or more. Some of them have not been able to cope with that level of anxiety, thinking that nothing would change, and have chosen bankruptcy as a consequence and therefore lost everything they had saved and worked for. For some whom I have heard about, sadly, this pressure may have contributed to something even worse: in the face of the bills and a long dark tunnel with no solution, they ended their lives. That is the backdrop. That is the tragic impact this has had on individuals across the country, and which has brought us to this place. This set of amendments is at the heart of those concerns. I first raised my worries about leaseholders being liable for all the costs of cladding, removal and remediation of all the fire safety defects when the Fire Safety Bill was first debated in 2020. Unfortunately, I did not succeed in amending it at that stage, but what has happened since has been remarkable—the number of people on all sides of the House who have taken up the cudgels to argue the case, rightly, for justice for leaseholders. I give enormous credit to the cladding campaigners from all groups and different cities around the country who have got together and done the investigation, found the facts and put the case to the Government, who, to their credit, have listened and made the changes we have seen today. I think there are over 200 government amendments to the Bill today. The question of justice for leaseholders is still at the heart of the Bill, and I contend that the Government still have not gone far enough in fulfilling what the Secretary of State and the Minister have said: that they should not pay a penny. They have done everything right and nothing wrong. They should not pay anything towards this remediation, because the flammable cladding, sometimes knowingly, was put on buildings, as was exposed in the Grenfell inquiry. Shoddy construction, sometimes deliberate, to cut corners and save costs, has also been exposed during the Grenfell inquiry. I want to speak to Amendment 156 in my name and that of my noble friend Lord Stunell, but also to Amendment 155 in the name of the noble Baroness, Lady Hayman, and to Amendments 158 and 159 in the names of the noble Lords, Lord Young of Cookham and Lord Blencathra, and the noble Baroness, Lady Hayman, to which I have added my name. They focus on trying to solve the problem of justice for leaseholders, who should not pay a penny. Unfortunately, the Minister has said today that “the majority” will not pay. Well, if the majority will not pay, the minority will—and the minority should not, because none of this is of their making. My Amendment 156 seeks to establish that what the leaseholder should pay is a peppercorn—a grand, historical way of saying zero, zilch. I thank the noble Lord, Lord Young of Cookham, for his support for Amendment 155 in the name of the noble Baroness, Lady Hayman, which uses the word “zero”. I use “peppercorn”, but they get to the same place, and he has acknowledged the justice of this case.
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Lord Marks of Henley-on-Thames (LD)My Lords, it is a great pleasure, especially after that introduction, to follow my noble friend Lady Pinnock. I should…
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Lord Marks of Henley-on-Thames (LD)Liberal Democrat
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My Lords, it is a great pleasure, especially after that introduction, to follow my noble friend Lady Pinnock. I should say that I have not spoken before on this Bill, and I apologise for coming in only at this stage. I want to contribute on just one aspect of the amendments in this group: the legal advice that the Government have apparently found persuasive, referred to by the noble Lord, Lord Young of Cookham, and by my noble friend Lady Pinnock. Noble Lords have heard that Amendments 155 and 156—and, to a lesser extent, 158 and 159—would significantly limit the permitted maximum payable by leaseholders under paragraphs 5 and 6 of Schedule 9 below the caps contended for by the Government, so that leaseholders would pay nothing, or only a small amount, towards remediation costs. The Government have asserted that, if those amendments were passed, the legislation would probably breach a freeholder’s right to the peaceful enjoyment of their property under Article 1 of Protocol 1 of the ECHR. I also understand that the Government are therefore concerned that that would mean the Minister could not make a statement of compatibility in conformity with Section 19 of the Human Rights Act. I do not accept that analysis, and I will say briefly why—and I hope I will be forgiven for quoting the relevant part. It is right that the article provides, in paragraph 1: “Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.” But paragraph 2 goes on to say: “The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.” I am relatively confident that this is not a straightforward deprivation case in the first paragraph, because there is no expropriation of the freeholder’s property, in fact or in law. My understanding is that the Government agree with this, although they say that the Strasbourg case law is not clear on the point. On that, I disagree. My reading of the cases on this issue is that they are indeed relatively clear, and that any argument that this is a full deprivation case is unsustainable. But much more difficult is the question of whether this is a case of the Government controlling the freeholder’s use of their property, in such a way as to amount to a breach of the article by imposing effectively the entire remediation costs on those freeholders. On the initial point as to whether or not this would be a control of use, I think the Government’s advice would be right, but that is not the end of the story. Once control of use is established, then the test is whether the conditions for its lawfulness in paragraph 2 of the article are met by the state. The test for a court, domestically or in Strasbourg, would be threefold. First, does the control of use serve the public interest? Secondly, does it comply with the conditions prescribed by law? Thirdly, does it pass what is sometimes called the fair balance test—that is, does is strike a fair balance between competing interests, and/or is it a proportionate response? Generally, the European Court of Human Rights will interfere only if the state’s control of use has been arbitrary or manifestly unreasonable. In my view, freeholders would face a difficult uphill battle to persuade a court that a requirement that they meet full remediation costs, pursuant to primary legislation for a clearly public-interest aim—that the fire safety of buildings should be paid for by the freeholder, not my blameless leaseholders—conflicted with the principle of lawfulness or failed to meet the legitimate aim requirement. Significantly in this context, the protection of the environment—which is, I suggest, analogous to the safety of residential property—has been clearly marked out in cases as a legitimate public interest, as have housing regulations involving rent control and protected tenancies. The freeholders would have to rely on what is essentially a backstop argument: that these provisions, as amended—if they are—fail to strike a fair balance between their interests in their enjoyment of their property and the interests of the state in achieving a legitimate public policy aim. To rebut such an argument the state would have to show only that the law, as enacted, avoids arbitrariness, that it is foreseeable in its application, and that it strikes a balance between the public interest in protecting blameless leaseholders from heavy charges and the private right of commercial freeholders to enjoy their property. It would be difficult to argue that this legislation, even with any of the proposed amendments, failed to meet the fair balance test. Nor is it, in my view, central to this argument that there should be a contribution of a particular amount or of a capped amount. For my part, I doubt that the European Court of Human Rights would find that the argument turned on the amount of any contribution by leaseholders. In this I disagree with the Government’s assessment. Indeed, it could be argued that the Government would be more, rather than less, vulnerable to an accusation of arbitrariness if they picked on a particular figure as a defensible cap, rather than legislated for nil contributions from leaseholders. I am greatly fortified in my overall view by the fact that the margin of appreciation, as it is known, for states in the application of the fair balance test is very wide. I will omit the references that it makes to a number of decided cases, but the European Court of Human Right’s guide on this article, at paragraph 134, I think, says that “the margin of appreciation available to the legislature in implementing social and economic policies will be a wide one and the Court will respect the legislature’s judgment as to what is ‘in the public interest’ unless that judgment be manifestly without reasonable foundation … Furthermore, the notion of ‘public interest’ is necessarily extensive … The Court normally shows deference to the Contracting States’ arguments that interference under its examination was in the public interest and the intensity of its review” —the court’s review— “in this regard is low.” It follows that I do not believe that a Minister could not properly and conscientiously make a statement under Section 19 of the Human Rights Act that, to use the words of Section 19, “in his view the provisions of the Bill are compatible with the Convention rights”. The Minister does not have to be certain; a 51% chance of success in resisting a challenge is sufficient. In my view, that standard is met.
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Lord Hope of Craighead (CB)My Lords, I have not spoken in these debates either. I hope, like the noble Lord, Lord Marks, I might be forgiven for i…
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Lord Hope of Craighead (CB)Crossbench
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My Lords, I have not spoken in these debates either. I hope, like the noble Lord, Lord Marks, I might be forgiven for intervening very briefly. I took the opportunity of looking at Article 1 of Protocol 1 shortly before coming into the Chamber today, and at some of the background authorities to which the noble Lord has referred. I agree entirely with his carefully worded speech in every respect. There is, of course, a question of balance and a question of the margin of appreciation and the other technical phrases that he has used, with which I am very familiar, but I think his assessment of all these points is absolutely right. The prospects of a successful challenge really are very remote, and the Government would succeed. I agree with his assessment, and I hope this might be of some comfort to the noble Baroness, Lady Pinnock, in her amendment, and to the noble Lord, Lord Blencathra.
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Lord Blencathra (Con)My Lords, it is a privilege to speak after hearing from two such knowledgeable noble Lords. I am tempted to say: let us…
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Lord Blencathra (Con)Conservative
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My Lords, it is a privilege to speak after hearing from two such knowledgeable noble Lords. I am tempted to say: let us cut to the chase and go straight to the vote on Amendment 115 and get it over with. In the meantime, I would like to speak on Amendment 115, which I strongly support, and Amendment 123. I would like to comment on Amendments 155, 156 and 157, and to my Amendments 158, 159 and 163. Before doing that, although I will not speak to them, I was privileged to support Amendment 117 on enfranchising leaseholders, Amendment 124, moved by the right reverend Prelate the Bishop of St Albans, on pensioners, and Amendment 153, moved by my noble friend Lord Young of Cookham. On Amendment 115, concerned with buildings under 11 metres, I strongly support what is proposed by the noble Earl, Lord Lytton. I hope he presses it to a vote unless my noble friend is willing to accept it. I have heard my noble friend the Minister say repeatedly—and he is largely right—that a building of under 11 metres may be less dangerous than a building of 20 or 30 storeys. I accept that even I could get out of a building of three storeys a bit faster than I could get out of one of 13 or 30 storeys. The risk is lower, but there is still a risk—that is one of the main points: there is still a risk. When we saw Richmond House burn down in nine or 10 minutes, it was horrifying. I hope that, if I was in there and woke up in time, I would have got out, but there might be some disabled people who could not have done so. There is also an issue of principle. If someone has built a building, whether it is 1 metre high or 11 metres high, and used flammable materials or the wrong materials, they should be made to fix it, no matter how wealthy they are—if it is Abramovich or anyone else. If the building has flawed materials, it should be repaired, irrespective of the height. I appreciate that my noble friend has gone a long way on this and that he has been very kind in telling us at countless meetings that there is a lower risk in those buildings, but there is still a risk. Of course, he also said that the numbers were very small: in that case, if the numbers are very small, it is a small problem to fix.
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Baroness Pinnock (LD)Let us do it.
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Baroness Pinnock (LD)Liberal Democrat
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Let us do it.
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Lord Blencathra (Con)Let us do it—that is a slogan for the next election for the noble Baroness. If the numbers are small, it is a small thi…
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Lord Blencathra (Con)Conservative
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Let us do it—that is a slogan for the next election for the noble Baroness. If the numbers are small, it is a small thing to fix. Moving on to Amendment 123, again I support my noble friend Lord Young of Cookham in changing the definition of “qualifying lease” so that buy-to-let landlords with an interest in up to five properties, including their main home, benefit from the leaseholder cost protections in Schedule 9. As my noble friend said, this is important because there are many buildings where there are a lot of little flats owned by buy-to-let landlords. If those landlords cannot pay their share of the bill, it will mean that not all the money is available to do the work for the whole building. Similar issues may arise when landlords own flats in multiple different affected buildings that have received help from the building safety fund. I appreciate that many of those landlords hold their buy-to-let properties as part of or, in some cases, all their pension provision. We have all had many emails from people in the past few days setting out some rather sad examples. I know my noble friend has increased the protection from two by-to-lets to four, but I do not think that goes far enough and we suggest that the overall figure should be five, but even then it omits many small landlords. I know it is not good law to quote hard cases, but I have an example of just one of dozens one has received in the past few weeks. This person says, “I am 57 and have worked as an electrical contractor most of my life. I now have nine small rental apartments in Salford, valued at £80,000 to £100,000 each, a total of approximately £800,000 before they were valued at £0 since the cladding crisis. These properties were purchased in 2007-08 with years of savings and dropped 40% in value due to the financial crash of 2009 caused by the banks, which were bailed out, so my properties are still in negative equity. My nine apartments in the same building are all subject to safety issues, and my total service charges for 2022 are approximately £250,000 for the external wall system only, and this quote is from last year. The managing agents are in the process of getting updated quotes, which will be much higher. This does not include firebreaks, compartmentalisation, fire doors, et cetera, so my total costs are likely to be over £300,000 on property valued at £800,000. Having nine rental apartments seems to deem me to be a large-scale landlord not worthy of protecting from these costs, whereas someone with one or two rental properties in London worth a similar value to my nine little flats will be protected under the latest proposals.” He concludes, “The developer of the building has not replied to any letters from our managing agent or us leaseholders and has been trying to close the company for months, which we have objected to. The company has not traded for six years and there are zero funds in the accounts.” That is a good example of why these amendments are necessary. It is not just the numbers, as the right reverend Prelate said, it has to be the overall value, and that is why I support my noble friend Lord Young’s amendment on having a percentage figure. If we cannot have zero or peppercorn, then 1% seems a fairer way of going about it. On my Amendments 158, 159 and 163, the Government’s proposals require leaseholders in properties worth more than £175,000 and up to £1 million outside London to pay £10,000 towards non-cladding remedial works if money cannot be found from developers or landlords. In London leaseholders in properties worth more than £325,000 and up to £1 million may have to pay up to £15,000. Again, that is if money cannot be found from developers or landlords. Higher caps of £50,000 and £100,000 apply inside and outside London for properties worth more than £1 million or £2 million. The Government say that these caps are necessary, again because of legal advice which we have just heard rebutted and on which I shall comment in a moment. The claim is that in order to impose measures on developers and landlords it is necessary for leaseholders to contribute in some cases or we fall foul of the ECHR. Amendment 158 in my name, also supported by my noble friend Lord Young of Cookham and the noble Baronesses, Lady Hayman of Ullock and Lady Pinnock, simply says “leave out ‘£15,000’ and insert ‘£7,500’”, halving the figure. For buildings in London, the amendment halves the contribution of leaseholders to non-cladding costs. Similarly, Amendment 159, for buildings outside London, reduces it from £10,000 to £5,000, halving the contribution of leaseholders on non-cladding costs; again, supported by my noble friend Lord Young of Cookham and the noble Baronesses, Lady Hayman of Ullock and Lady Pinnock. Finally, Amendment 163, again supported by my noble friend Lord Young of Cookham, says, “leave out ‘£50,000’ and insert ‘£15,000’”. That applies to the properties inside and outside London worth between £1 million and £2 million. The amendment would reduce the leaseholder contribution to non-cladding costs from £50,000 to £15,000. All told, as we come to the end of this debate, the Government have been given four options by the various amendments. There is the zero option, proposed by the noble Baroness, Lady Hayman of Ullock; the peppercorn option, proposed by the noble Baroness, Lady Pinnock; the 1% option proposed by my noble friend Lord Young of Cookham; or they can lower the cap, as in the amendments that I have just described. We have done all those amendments on lowering the cap in the hope that we could get around the Government’s view that the ECHR would put a block on this and that they would have to say that the Bill, or Act, was not compliant with the ECHR. But we have just heard from two eminent and learned noble Lords and an ex-Supreme Court judge that none of these amendments would be in breach of the ECHR. As the noble Lord, Lord Marks of Henley-on-Thames, pointed out, even if we do not accept of these amendments and stick with the government ones, there will be some freeholders, landlords and developers who will still go to the ECHR and complain about anything to slow it down. So sticking with the Government’s level does not get us out of litigation in the European court. I look forward to what my noble friend has to say on this. The legal arguments produced by the noble and learned Lords are very telling. I commend my amendments to the House, and also commend those from the noble Earl, Lord Lytton.
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Baroness Fox of Buckley (Non-Afl)It is a great pleasure to follow the noble Lord, Lord Blencathra. In relation to Amendment 115, the noble Lord discusse…
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Baroness Fox of Buckley (Non-Afl)Non-affiliated
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It is a great pleasure to follow the noble Lord, Lord Blencathra. In relation to Amendment 115, the noble Lord discussed the 11-metre question. The emphasis is often on whether there is less risk in safety terms under or over 11 metres. For me, that slightly misses the point—which is that, regardless of whether you have resolved that, the problem is that freeholders are still charging and doing remediation work on buildings under 11 metres. Therefore, there are costs that those people who live in buildings under 11 metres have to pick up. The lecture that it is less risky over 11 metres really needs to be given to the freeholders not, necessarily, to the leaseholders—but that does not really help us, I think. More generally, this is such an important group of amendments. The noble Baroness, Lady Pinnock, passionately reminded us of the context. It is true that being a leaseholder today is no longer just a description—it has almost become a full-time job in terms of fending off more and more financial demands and getting on top of the law. If you go and meet a group of leaseholders, they are having the kind of discussion about the ECHR that we have just heard from noble Lords, because they are trying to get on top of all these details and technicalities. It has become an overriding source of worry and anxiety, and genuinely—rather than just being about the status of home ownership—it has become a hellish state of affairs. So they need anything that can resolve that, and that is why this Bill is so important and this group of amendments matters. My amendment in this group is a tiny, modest amendment that relates to evaluations. Amendment 165A in my name asks that any evaluations used to decide on caps for those still being charged for remediation should be looked at in a slightly different way. I do not want anything to be paid—I would go with peppercorn or nil—but if there are caps deployed and evaluations used, I remind noble Lords that we need to rectify a different kind of injustice. The amendment asks that those valuations take into account that the leaseholder’s ability to pay will have been affected by the fact that their main wealth may be in the form of their asset—their home—and that their asset’s value may well be devalued hugely due to fire safety and building safety policies. The amendment notes that the properties may well be in negative equity as a consequence of government measures.
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Baroness Neville-Rolfe (Con)My Lords, there are many amendments in this group, and I have concerns about the open-ended financial implications whil…
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Baroness Neville-Rolfe (Con)Conservative
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My Lords, there are many amendments in this group, and I have concerns about the open-ended financial implications while it remains unclear who is responsible for a perpetrator who cannot be found, or who is beyond the reach of the law—thus the importance of the review that the Minister has, I believe, agreed to bring forward much sooner than five years’ hence, although, without my amendment, he would need another Bill if we have to make changes, which seems inevitable. There have been many powerful speeches, not least from the right reverend Prelate the Bishop of St Albans. I will not repeat what has been said. I have, however, given my support to Amendment 123, and I would like to take the opportunity to commend my noble friend Lord Naseby who in Committee highlighted the unfairness of excluding buy-to-let premises from the safeguards in the Bill for reasons we have heard. The Government have acknowledged that he was right. However, I agree with my noble friend Lord Young of Cookham that it is difficult to limit this arbitrarily to the ownership of two extra UK properties. I would prefer his formula of four properties, or some other, fairer system. He and others have worked so hard to get the various provisions of the Bill right. For example, he said that we may not have capped the liability of enfranchised leaseholders—which he and I have worked on together—as we had been led to believe in Committee. I look forward to my noble friend the Minister’s reply on the rationale and an answer to all the good points that have been raised, particularly on enfranchised leaseholders and how we do buy-to-let fairly.
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Baroness Hayman of Ullock (Lab)My Lords, this has been an extremely important debate in which we have covered some of the critical issues still outsta…
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Baroness Hayman of Ullock (Lab)Labour
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My Lords, this has been an extremely important debate in which we have covered some of the critical issues still outstanding in the Bill. I thank the Minister for the introduction to the amendments. Many of them are good, but we believe there are still problems that need to be sorted out. I will be brief. I thank the noble Earl, Lord Lytton, for his introduction to Amendment 115. If he decides to divide the House, he will have our support on that amendment. I turn to my Amendment 155. It is really important that we take account of the principle that has been referred to by other noble Lords: there should be no cost to people who have done nothing wrong. It is not the fault of leaseholders that they have been left with these huge costs. We believe it is desperately unfair to force them to pay a penny, which is why my amendment has the word “zero” in it. As mentioned by the noble Baroness, Lady Pinnock, we must not forget the strain on the mental health of leaseholders. They need clear and proper support, and they are relying on your Lordships to do the right thing by them. To me, this is a moral question. Should leaseholders pay costs that, for many, will still be huge despite the caps proposed by the Government? They are blameless; they should pay nothing. I thank the noble Lord, Lord Marks, and the noble and learned Lord, Lord Hope of Craighead, for clearly laying out the legal position. It has been important for me to hear that from them, and the detail that they have provided, having had discussions with the Government on their concerns about the ECHR. I also thank the noble Lords, Lord Young of Cookham and Lord Blencathra, and the noble Baroness, Lady Pinnock, for their support. I confirm that I intend to divide the House on Amendment 155. If it fails to pass, I will be happy to support the noble Lords, Lord Blencathra and Lord Young, on Amendment 158.
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Lord Greenhalgh (Con)My Lords, I spoke to the government amendments as I hoped it would assist the House to have the Government’s views. Wit…
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Lord Greenhalgh (Con)Conservative
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My Lords, I spoke to the government amendments as I hoped it would assist the House to have the Government’s views. With the permission of the House, I will now speak again in reply to the points raised by noble Lords on the non-government amendments that they have tabled. Amendments 155 to 160 and Amendments 162 to 163 deal with leaseholder contribution caps. I thank noble Lords for their contributions and constructive approach, but I am afraid that the Government will not be able to accept these amendments. It is important to bear in mind that leaseholder contributions apply only in certain circumstances, and even then, only when a series of other steps have been exhausted. The caps do not apply at all in relation to cladding defects, nor do they apply where the value of the flat is less than £175,000 outside Greater London and £325,000 inside. The caps only apply where the building owner or landlord is not linked to the developer and cannot afford to pay in full, where the developer cannot be made to fix their own building, and where the building owners have exhausted all reasonable steps to recover costs from third parties. Leaseholder contributions will only apply where there is no clear developer or wealthy landlord to meet the costs in full, and the party responsible for defective work cannot be identified. The Government consider that this will occur only in a minority of circumstances. Where there is no party that clearly should pay in full—and only then—our approach spreads the costs fairly and equitably across those with an interest in the building and ensures above all that the most vulnerable leaseholders are protected. The Government’s latest amendments go even further in protecting leaseholders. Where the freeholder or landlord is not at fault and cannot pay to meet the costs, we need to ensure a proportionate approach that takes into account the interests of all parties. That is why our approach spreads the costs equitably among all relevant parties with an interest in the building. The amendments tabled by the noble Baronesses, Lady Hayman and Lady Pinnock, and—
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Lord Cormack (Con)Can my noble friend quantify how many people he expects will be paying? What is the maximum amount they will pay?
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Lord Cormack (Con)Conservative
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Can my noble friend quantify how many people he expects will be paying? What is the maximum amount they will pay?
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Lord Greenhalgh (Con)I cannot quantify the exact amount people will pay, but it is fair to say that we have set out a fundamental system of…
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Lord Greenhalgh (Con)Conservative
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I cannot quantify the exact amount people will pay, but it is fair to say that we have set out a fundamental system of protection that admittedly does not go as far as the zero or peppercorn proposed in opposition amendments, but it does go a considerable way to ensuring that leaseholders are the last in line to pay, as opposed to the first. As I said, the amendments tabled by the noble Baronesses, Lady Hayman and Lady Pinnock, and the noble Lord, Lord Stunell, seek to reduce leaseholder contributions to zero or a peppercorn. Where there is no clear party that must pay, it would not achieve a fair balance between relevant parties to transfer the costs in full to the freeholder or landlord. I appreciate that that opinion seems to vary from that of noble Lord, Lord Marks of Henley-on-Thames, but that is the government position. Amendments tabled by my noble friends Lord Young and Lord Blencathra propose to reduce the leaseholder contribution caps, and another amendment proposes alternatively that the contribution is 1% of the lease value. The Government have already taken significant and far-reaching steps to protect leaseholders, protecting those in lower value properties and doubling the repayment period to 10 years. On that basis, I ask the noble Lords not to move their amendments. Government Amendment 164 provides for the value of a lease to be determined without the need for a valuation. It allows for the value of the lease to be determined by uprating the most recent sale price prior to 14 February 2022. The uprating, which will be set out in regulations, will ensure all properties are compared on a level playing field. The uprating will be based on a metric called the house price index which tracks house prices. This will allow properties to be assigned a nominal present-day value. Amendment 165, tabled by my noble friends Lord Young and Lord Blencathra, proposes that the value of the lease would be based solely on its most recent sale price. I am afraid the Government will not be able to accept this amendment as it would put leaseholders who have purchased their properties more recently at a significant disadvantage. The Government consider it important that properties are compared like for like, irrespective of when they were last sold. On that basis, I ask my noble friends not to move to their amendments. I will turn now to Amendments 123 and 124, which deal with the definition of a qualifying lease. The Government have already tabled amendments which will see people with a total of up to three UK properties eligible for the protections. Amendment 123, tabled by my noble friends Lord Young and Lord Blencathra, proposes to increase this to a total of up to five UK properties. Amendment 124, tabled by the right reverend Prelate the Bishop of St Albans, proposes to increase the total to six for individuals in receipt of a state pension. I am afraid that the Government will not be able to accept these amendments. As I have previously discussed, it is important that the Government take a proportionate approach and ensure that our measures are fair to all parties. This includes considering where certain groups of leaseholders are likely, on average, to be able to afford to contribute to the costs of remediation. The Government need to focus their protections on those who need it most, primarily leaseholders living in their own homes and those who have moved out and are subletting. We also recognise concerns about people with small numbers of additional properties, and that is why we are ensuring those with up to three UK properties will be protected.
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The Earl of Lytton (CB)My Lords, I will test the opinion of the House on Amendment 115 in a minute. However, before I do so, I will say how mu…
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The Earl of Lytton (CB)Crossbench
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My Lords, I will test the opinion of the House on Amendment 115 in a minute. However, before I do so, I will say how much I appreciate the contributions from all noble Lords. It has been an absolutely fascinating debate. As others have said, we are really getting into the core philosophy of what sits behind this Bill. I feel slightly like the skinny fly-half who, having got hold of the rugby ball and made a dash for the opposing side’s try line, finds himself up against a veritable wall of the opposition. It is only seconds later that he finds that a substantial number of heavyweights from his own side have propelled him over the line and applied him and the rugby ball into the mud to score a try. We have not scored a try yet. That, of course, depends on noble Lords—the referees. I thank the noble Lord, Lord Young, for his summary of this and the other amendments—I found him to be wholly convincing. I will not go into a great deal of detail, given the well-rounded debate we have had, but Amendment 117 seems to address an issue which actually borders on discrimination on the grounds of tenure, and it is a really perverse outcome for commonholders as a tenure. It is a tenure to which the Government should be giving support—we all know that. Excluding them cannot be right. Various noble Lords have spoken about extending the number of buy-to-let properties. That would rely on their accepting the basic premise of a charge to the leasehold and freehold properties as a default mode—I shall come back to that in a minute. Amendment 126 is necessary because, unless the benefits under the Bill inure to the benefit of the buyer as a signee, the Bill would simply act to the prejudice of the seller, which would remain and lead to unfair loss, cost, worry, delay and disadvantage—and we cannot have that. A reduction to zero charge would be beneficial and I would support it, but, again, I go back to the question whether I would start from this point. I welcome a lot of these amendments and would welcome some of those from the Government if I was not troubled by their basic premise of deciding that orphan cost liabilities must be spread between two categories of the innocent. It is a matter of policy; it is not a matter of human rights. I listened carefully to what the noble Lord, Lord Marks, and the noble and learned Lord, Lord Hope of Craighead, said on that, and I found it absolutely fascinating. The fact remains that freeholders as we know them very often have a minority interest by value, so the questions remain: where do you find that real, available hard cash to fund the remediation, and after what degree of litigation, delay and cost? Despite what the Minister said, and I admire his tenacity, I remain unconvinced by the arguments. On sub-11 metres, I do not see that the argument has been made for the quantifiable difference under the Bill that the Government are trying to achieve, bearing in mind that the Worcester Park building was a four-storey building. I wish to test the opinion of the House on Amendment 115.
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The Deputy Speaker (Baroness Pitkeathley) (Lab)My Lords, I cannot call Amendment 116, as it was pre-empted by Amendment 115, which has already been agreed by your Lor…
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The Deputy Speaker (Baroness Pitkeathley) (Lab)Labour
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My Lords, I cannot call Amendment 116, as it was pre-empted by Amendment 115, which has already been agreed by your Lordships. Amendment 117
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The Deputy Speaker (Baroness Pitkeathley) (Lab)My Lords, as Amendment 117 has now been agreed, I cannot call Amendments 118 and 119. Amendment 120
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The Deputy Speaker (Baroness Pitkeathley) (Lab)Labour
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My Lords, as Amendment 117 has now been agreed, I cannot call Amendments 118 and 119. Amendment 120
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The Deputy Speaker (Baroness Pitkeathley) (Lab)I cannot call Amendments 158 and 159 for reasons of pre-emption.
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The Deputy Speaker (Baroness Pitkeathley) (Lab)Labour
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I cannot call Amendments 158 and 159 for reasons of pre-emption.
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Baroness Scott of Bybrook (Con)My Lords, we now come to the final debate on Report of this Bill, and I will speak to a number of government amendments…
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Baroness Scott of Bybrook (Con)Conservative
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My Lords, we now come to the final debate on Report of this Bill, and I will speak to a number of government amendments on construction products. Noble Lords will be familiar with a number of these amendments already as they were debated and withdrawn during Committee. I will begin by speaking to Amendments 245 to 249. This set of new clauses will introduce a new cause of action against construction product manufacturers and sellers of construction products. There are currently limited routes which might allow leaseholders, building owners and homeowners to hold to account construction product manufacturers or sellers for their role in the creation of building safety defects. The cause of action will enable claims to be brought against construction product manufacturers and sellers for their role in causing problems associated with building safety. It will apply where a construction product has been mis-sold or is found to be inherently defective, or if there has been a breach of the construction products regulations applicable at the time and it has been used in the construction of a dwelling or works on that dwelling. If this contributes to a dwelling being unfit for habitation or causes it to be so, a civil claim will be able to be brought through the courts under this cause of action. This cause of action will be subject to a 30-year limitation period retrospectively in relation to cladding products only. The new cause of action will also apply retrospectively to all construction products and be subject to a 15-year limitation period. These limitation periods mirror the changes we are making to the Defective Premises Act. This cause of action will help to ensure that construction products manufacturers, distributors and others are held responsible for the cost of rectifying their mistakes, where a dwelling is unfit for habitation as a result of those mistakes. Amendments 255 and 271 are consequential to these amendments. I now move on to Amendments 250, 251, 252 and 253, which will create a power to make regulations to require construction products manufacturers, their authorised representatives, importers and distributors to contribute towards the cost of remediation works where they have caused dwellings to be unfit for habitation or contributed to dwellings being unfit for habitation. This will enable the Secretary of State to serve a costs contribution order on a company that has been successfully prosecuted under the construction products regulations. Amendment 253 will allow the Secretary of State to appoint an independent person to inspect buildings where the relevant product has been used. They will assess whether the conditions for serving an order are met, the remediation works required and the cost of those works. Amendment 251 will also create a power to make regulations to take an alternative route through the courts. This will enable the Secretary of State to apply to a court for a costs contribution order to be made against a company. The grounds for making an application would be the same. Amendment 253 will enable the Secretary of State to require a company to contribute towards the cost of building assessments carried out as part of this process. Amendment 256 makes a technical correction to secure that the maximum fine that can be imposed under the construction products regulations for an offence in Scotland is the statutory maximum in Scotland. Setting out this scheme in secondary legislation will enable the detailed design of these powers to interact with the construction products regulations, including those that will be made using the Bill’s powers. Amendments 269, 270 and 273 are consequential to these amendments. Amendment 257 will require that the affirmative procedure is used to make any regulations that would remove construction products from the list of safety-critical products set out in the construction products regulations. I have considered carefully the important points raised by the Delegated Powers and Regulatory Reform Committee in its report on the Bill regarding the parliamentary procedure that should be used to make regulations under this power. I thank the noble Lords, Lord Stunell and Lord Khan, for their contributions on this matter in Grand Committee. It is of course right that regulations receive the proper level of parliamentary scrutiny. That is why Amendment 257 will supplement the existing safeguards in Schedule 12, which prevents products being added to the list unnecessarily or removed without good reason. I hope the noble Lords are reassured that this strikes the right balance between the need for parliamentary debate to scrutinise regulations and the proper use of the limited and valuable time of parliamentarians. Finally, Amendments 216 and 217 make a minor drafting change in relation to the definition of “persons carrying out activities in relation to construction products” in Clause 129. I beg to move.
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Lord Stunell (LD)My Lords, briefly, we welcome the changes that the Minister has reported, particularly Amendments 257, 258 and 259, whi…
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Lord Stunell (LD)Liberal Democrat
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My Lords, briefly, we welcome the changes that the Minister has reported, particularly Amendments 257, 258 and 259, which will bring back to the affirmative procedure some of those matters which we raised in Committee. We appreciate that and we are very happy to support the Government’s amendments in that respect.
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Lord Khan of Burnley (Lab)My Lords, I welcome this final group of amendments relating to construction products. The Government are absolutely rig…
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Lord Khan of Burnley (Lab)Labour
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My Lords, I welcome this final group of amendments relating to construction products. The Government are absolutely right to take steps to increase the recourse available to residents and responsible persons where construction or cladding products have led to residences becoming uninhabitable. Government Amendment 246 is particularly welcome, as it provides for a new right of action where breach of regulations relating to construction projects leads to a building or dwelling becoming unfit for habitation. Every person and family deserves the right to live in a safe and habitable home. On this issue, I would be grateful if the Minister could clarify whether the Homes (Fitness for Human Habitation) Act already provides for similar guarantees. I also particularly welcome Amendments 247 and 248, which intend to provide a right of action for a 30-year limitation period where historic defaults relating to cladding either cause or are a factor in a building or dwelling becoming unfit for habitation. I am sure that the whole House will agree that the passage of the Bill should represent a turning point for building safety in the UK, and I hope that these amendments will contribute to that.
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Baroness Scott of Bybrook (Con)I thank noble Lords for their support for these important amendments —I will write to the noble Lord on his question; I…
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Baroness Scott of Bybrook (Con)Conservative
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I thank noble Lords for their support for these important amendments —I will write to the noble Lord on his question; I do not have it in my pack. This shows that, throughout the Bill, we have listened to noble Lords across the House and have done what we can. I thank noble Lords for their engagement and for their continued support for most of the Bill. It is important because it will ensure that in this country everyone’s home is a place of safety.
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Baroness Pinnock (LD)My Lords, I wish to move Amendment 221 formally and divide the House on it. We have already decided that leaseholders w…
Speaker
Baroness Pinnock (LD)Liberal Democrat
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My Lords, I wish to move Amendment 221 formally and divide the House on it. We have already decided that leaseholders will not pay towards the cost of remediation, and now we have the chance to decide that it is done in a timely way. That is just as important, so I beg leave to seek the opinion of the House.
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The Earl of Lytton (CB)I wish to test the opinion of the House.
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The Earl of Lytton (CB)Crossbench
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I wish to test the opinion of the House.
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EnactedBuilding Safety Act 2022