My Lords, I speak to Motion C1 and Amendments 4B to 4E. I give notice of my intention to seek the opinion of the House when the time comes. I declare my interest in the register in that I, too, am a vice-president of the Local Government Association.
I first thank the honourable Members for Stevenage and for Southampton, Itchen, who originally prepared these amendments, as well as the signatories from all parties when they were tabled in the Commons. I also thank the right reverend Prelate the Bishop of London, who joins me in supporting it, and pay tribute to one of our colleagues, the Bishop of Kensington, who has worked very closely on the ground with victims of Grenfell and leaseholders.
Grenfell was an unmitigated tragedy brought about, it would seem, by institutional failings on multiple levels. The recent revelation that the cladding provider knew that it could result in tragedy and death is nothing short of a disgrace. It has been a tragedy for many lives: ordinary families have been ripped apart by this terrible event.
The Bill will deal with the problem of dangerous cladding by creating a quick and easy mechanism to force freeholders to remove dangerous cladding and other fire safety defects. That is undoubtedly a good thing and will, hopefully, protect against future tragedies, but I share the disappointment of the noble Lord, Lord Kennedy, that Her Majesty’s Government have not sought to address the severe adverse financial consequences that the Bill will create for leaseholders. In the Bill’s current form, whenever the fire service serves notice to the freeholder requiring remedial work to be undertaken, the freeholder will be able to force leaseholders to reimburse all the costs incurred. These costs are staggering.
At this point, I say that our hearts go out—I am sure we all share this—to all the people who are struggling. I have been inundated with emails, tweets and people contacting me who are at their wit’s end looking at what is likely to unfold in the next few weeks. Far from the Government’s estimated remedial costs of around £9,000 per leaseholder, depending on the terms of the lease and the work involved, a leaseholder could very easily be handed a bill of £50,000, payable within weeks.
Inside Housing conducted its own private survey of 1,342 leaseholders. Its findings reveal a very different picture to that of Her Majesty’s Government. Among those surveyed, 63% of respondents faced a total bill above £30,000 for remedial costs and 15% faced a bill of more than £100,000. Of course, a few of these lease- holders may be well off, some will have disposable income, but most will not: 60% had a household income of less than £50,000, with only 8.7% reporting a household income of more than £100,000. In other words, this will primarily affect ordinary middle to working-class people.
In addition, 56.4% of those surveyed were first-time buyers. They have followed that life trajectory that many Conservative Governments have sought to promote by working hard, saving and purchasing a property. These are people with aspirations—something I totally support—yet nearly everything they have worked hard towards, over many years, could be taken away from them, as shown by the alarming 17.2% of respondents who say that they are already exploring bankruptcy options. I must remind the House that the costs mentioned above include only the remedial costs; they say nothing about the interim fire safety costs that leaseholders already incur.
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Government figures show that the average monthly cost of a waking watch in England is estimated at nearly £18,000 per building and around £330 per dwelling, rising to nearly £20,000 and £500 respectively in London. This is not to mention the cost of new alarm systems, ranging from £50,000 to £150,000 per block. How can this be fair or just? It was not the leaseholders who sold or fitted defective cladding; leaseholders are the innocent party. They purchased their properties in good faith, believing them to be safe. If the Bill passes unamended, it is they who will pay—not the cladding providers or the developers but hard-working ordinary people, forced to pay for defects that were deemed safe when they purchased their apartments.
I do not have the technical knowledge about how the Motion fits with the Bill and so on, and whether it would be better placed in a later Bill. What I do know is that we are faced with some immediate challenges. Any solution cannot be deferred until the building safety Bill, which could be as far as two years in the future. We have to try to do something now. Supporters of this Motion and I have argued that because this legislation creates the problem for leaseholders, it should likewise solve the problem. I acknowledge that there are some weaknesses in this Motion; it does not solve every problem for leaseholders. Even if it is passed, leaseholders will still shoulder ongoing interim fire safety costs. However, by preventing remedial costs from being passed on to leaseholders, a significant proportion of the financial burden placed on them should be eased. As one leaseholder said, “We need a solution so we can finally move on with our lives, something denied to us now for several years. We just want this nightmare to end”.
I hope that by passing this Motion, we can begin to end that nightmare and the anxiety plaguing the lives of thousands of leaseholders, allowing them to move on. The Bill solves the fire safety defects that lay at the heart of the Grenfell tragedy. The Government are absolutely right to do that and I am grateful for what they have done, but I believe they are morally wrong in their treatment of leaseholders in this crisis. By not including sufficient provision to protect leaseholders, a conscious decision would be made to impose poverty, possibly bankruptcy and certainly misery on thousands of ordinary people whose only crime was being aspirational.
Those responsible should be the ones who pay. Only the Government can provide the capital up front to pay for these works; only the Government can introduce levies on those responsible to claw back that money over the next few years. A great injustice is currently being done to leaseholders and a fair solution is needed, which is why I bring this Motion to your Lordships’ House.