Westminster update: government announces amendments to leasehold bill

Ben LloydPublic affairs assistant at the Law Society
Blog
17 Jun 2024
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Your weekly update from the Law Society’s public affairs team on all the latest developments and debates in Parliament and across Whitehall.
The palace of Westminster in the evening.
Photograph: Thomas Riebesehl

One thing you need to do

We recently updated our legal aid desert maps, highlighting how years of underfunding continue to cause practitioners to leave the sector. Our research shows 85% of the population do not have access to a local welfare solicitor and 44% are without a local housing solicitor.

What you need to know

1. Government announces amendments to leasehold and freehold bill

On Tuesday 27 February, the Leasehold and Freehold Reform Bill had its report stage and third reading in the Commons.

The minister of state for housing Lee Rowley began by introducing new clauses to clarify and strengthen accountability for management companies.

New clauses will ensure tribunals are able to compel companies to address any immediately dangerous faults while remediation is concluding. This also addresses the cost of temporary accommodation.

Rowley also announced the long-awaited amendments to ban the sale of new leaseholds. The minister admitted there is little excuse to sell new builds as leaseholds, and he outlined some classifications to which leasehold builds can still occur.

New Schedule 2 outlines these exemptions including National Trust land, shared ownership land, and community land trusts. He also asserted that these exemptions can be revisited.

Wendy Morton (Conservative) asked if this ban will be extended to flats. Rowley replied that the government remains committed to making progress on finding an alternative, workable reform to this system.

Rowley went on to highlight the new clause 50, which requires freeholders to provide solicitors and leaseholders with transparent information during property marketing.

To ensure enforcement, clause 51 issues a warning if transparent information has not been sent in due time and measures extend further with fining powers through new clause 59.

Labour asked for clarity as to why the government thinks these new clauses are necessary, given that cases exist relating to the Olympic Village ruling that the tribunal already has the power under the Building Safety Act 2022 to order remedial works in respect of a relevant defect.

The shadow minister for housing Mathew Pennycook voiced Labour’s baseline support for efforts to curtail the prevalence of the leasehold system. However, Pennycook also asserted that a Labour government will go further to abolish the system in its entirety and introduce commonhold.

The Bill will now move to the House of Lords, where many speculate that it could be subject to further changes. 

2. Lord chancellor outlines approach to justice system

The lord chancellor, Alex Chalk, gave a speech on his priorities, including the courts backlog and the power of legal services at Conservative Home’s Crime and Justice conference on Tuesday (27 February).

The conference looked at support for victims within the justice system and saw members of the justice ministerial team discussing their approach to addressing the challenges the system is facing.

Chalk opened his speech by discussing how his experience of prosecuting and defending cases in the magistrates’ court – through to murder and terrorism cases – has provided a perspective on the impact of justice policy. He said that he uses these insights every day to help guide his role as lord chancellor.

Reflecting on the issues facing the system, Chalk said that things could have been done differently over the past 14 years, but felt the challenges should not mask what he sees as important improvements.

Chalk argued that crime has fallen, reoffending is down and the government has reformed and strengthened sentencing.

Furthermore, he acknowledged the significant courts backlog, but claimed this had come from the decision to maintain jury trials during the pandemic. Chalk also highlighted keeping Nightingale courts open as one way the government was responding to the backlog.

If the government is re-elected, Chalk said his priorities will be to fix the planning system for prisons, deport more foreign offenders and support the legal services sector to thrive and grow.

3. SLAPPs: Sir David Davies highlights corruption in the justice system

Following on from the introduction of the SLAPPs Private Member’s Bill, last week Sir David Davis (Conservative) led an adjournment debate on the British Justice System and International Corruption Cases, the third such debate on oligarchs and lawfare that he has tabled in the last two years. He used his parliamentary privilege to focus on the proven and alleged corruption of Mohammed Amersi and his various lawsuits.

Davis singled out “cash hungry charities, universities and political parties” who have gladly accepted money from corrupt regimes around the world. He flagged the case of Amersi v. Leslie (Conservative MP) as an example of an “excessively long, drawn out and expensive legal case” that sought to destroy Charlotte Leslie’s reputation.

He cited the “notorious legal firm Carter-Ruck” and its involvement in threatening behaviour. He also referenced Amersi’s links to not only Russia but to Uzbekistan, Nepal and Kazakhstan.

Davis then turned to Amersi’s relationship with the British legal system. He noted that “a picture emerges of an attempt to avoid justice by obscuring the truth”.

The MP added that “he has donated to charities, academic institutions, and the Conservative party, and apparently, he now intends to donate to Labour. Clearly, he will do whatever he can to get influence. The British establishment is clearly vulnerable”.

The justice minister Gareth Bacon responded for the government, noting “we must confront the reality that, while our justice system stands as a beacon of fairness and equality for many, the corrosive effects of corruption can undermine justice here and around the world.”

He added: “In acknowledging that challenge, we affirm our commitment to uphold the principles of justice and to ensure that the rule of law remains steadfast.”

Bacon went on to highlight the impact of such cases on our justice system, raising the measures in the Economic Crime and Corporate Transparency Act and the new Private Members’ Bill led by Wayne David (Labour).

He noted that the PMB has “received from stakeholders across media, law, civil society, and both Houses of Parliament. It is a credit to our country that so many are prepared to come together to tackle this issue across the political spectrum.”

Bacon also noted the work that the Solicitors Regulation Authority (SRA) has been doing to tackle SLAPPs, highlighting the thematic review and warning notice.

We are expecting these issues to continue to feature in debates in both Houses and are now awaiting the announcement of the Committee, which will complete the scrutiny of the Private Members’ Bill.

Coming up

The chancellor of the exchequer will give his Spring Budget on 6 March. The Law Society has made a submission to the Treasury outlining steps the government can take to unleash the economic potential of legal services.

The Law Society is working on a number of bills in Parliament: