PERSONAL REPRESENTATIVES (Hansard, 13 March 2002)

§ Ms Keeble
I beg to move amendment No. 44, in page 65, line 2, leave out "one year" and insert two years".

§ Madam Deputy Speaker
With this it will be convenient to discuss Government amendment No. 45.

§ Ms Keeble
These amendments will extend the period in which personal representatives can exercise their rights. Instead of the arguments that we heard in the previous debate, which neither helped to elucidate the law nor 933 proposed any changes, I hope that we shall hear some cogent arguments from Labour Members on these amendments, which were tabled in response to the very persuasive arguments made in Committee by my hon. Friend the Member for Cleethorpes (Shona McIsaac).
It might be helpful to begin with a little background to amendment No. 44, which relates to the right to new longer leases for flats. Under existing law, when leaseholders die, their personal representatives can be left in a difficult position. Their inheritance may consist of a lease that is too short to sell easily, and the freeholder may insist that they pay over the odds for an extended lease. The Bill provides that, when the deceased leaseholder would have qualified for the right to a new longer lease, that right will pass to the personal representatives, but that they will have to exercise that right within a year of the grant of probate or letters of administration. The amendment will extend that period to two years.
Arguments have been made previously for a longer extension, but it is worth noting that, after holding the lease for two years, the personal representatives will qualify for the right to a new longer lease in the normal way, and, for the information of the hon. Member for Stone (Mr. Cash), clauses 129, 137 and 138 will apply. Personal representatives will no longer need to rely on the special rights granted to them.
Amendment No. 45 makes an equivalent change to clause 141, which pertains to the right to a lease extension and the right to enfranchise as it relates to personal representatives of leaseholders of a house.
I commend the amendments to the House. They will make a welcome addition to the rights of leaseholders and their personal representatives.

§ Mr. Cash
I am extremely glad that the amendments have been tabled. I well remember that the matter was thoroughly considered in Committee, and the reasoning behind the amendments has been explained by the Minister. The hon. Member for Cleethorpes (Shona McIsaac) has made a useful contribution to these changes, and it would also be fair to say that the Committee as a whole greatly benefited from the suggestions that were made.
I think that I am right that, in Committee, the question was whether we should leave out "one year" and insert "five years". There was a good deal of discussion about that, and I find in the Official Report of Standing Committee D that I referred to the Committee making progress. I added: I agree with the hon. Member for Cleethorpes and I also agree with my hon. Friend the Member for Leominster about making the period too long. Will the Minister consider the possible bar in the mechanics of the provision of information by the freeholder? I then made a point that I have made many times: All hon. Members have an interest in ensuring that these proposals work…as we proceed, we think of ways to make the Bill more workable. That is in the interests of leaseholders and freeholders. I have no doubt that huge numbers of leaseholders will benefit from provisions of this sort in the interim period". 934 Indeed, the hon. Member for Torbay (Mr. Sanders) said: The Minister has proposed a happy compromise, which we shall support on Report, but I wonder why it had not been thought through beforehand. If one can enfranchise after two years' residence, why make the period one year in the case of inheritance? He then congratulated the hon. Member for Cleethorpes on prompting the Government in that direction".—[Official Report, Standing Committee D, 22 January 2002; c. 141.] The hon. Member for Cleethorpes then withdrew her amendment, although she does not have to do so on this occasion, as a Government amendment has been tabled. That demonstrates the wonderful alchemy of the Government and their Back Benchers—they can turn one year into two years, and it turns into gold.
I strongly commend the Government amendment. Matters have been explained at length in Committee, and perhaps the hon. Member for Cleethorpes will want to make a few remarks. It is extraordinary how such a small amendment—changing "one year" to "two years"—might have a considerable effect in the circumstances. I therefore congratulate the hon. Member for Cleethorpes—and the Government on listening to what she had to say—and other members of the Committee who tried to make a small contribution at not too great a length.

§ Shona McIsaac (Cleethorpes)
With such an invitation, I cannot resist taking part in this debate. I welcome the Government amendment. The hon. Member for Stone (Mr. Cash) is right that I focused on the issue a great deal in Committee, although I shall not go into it at such length today.
I started lobbying on the matter back in July 2000. That gives the hon. Member for Stone some idea of how long it has taken to get to this stage. In July 2000, I was given leave to introduce a Bill on leasehold reform under the ten-minute rule. At that time, I focused on inheritance problems. I found that far too many residents in my constituency were very badly affected by the inadequacies of the law on inheritance.
Many of the people concerned were elderly, and although they knew that they were in leasehold properties, the cost of enfranchising meant that they did not proceed with buying the freehold. Others did not even realise that their houses were leasehold properties. Sometimes, people who had grown up in a property found when their parents passed away that their parents had not owned the house, as most of us would assume if they had paid off a mortgage. Because their parents were tenants, those families could not buy the freehold. Some families therefore found out that they were likely to lose their family homes.

§ Mr. John Taylor
The hon. Lady vividly describes the kind of problems faced by some of her constituents. Does she agree that those problems are compounded by the absence from the Bill of a valuation formula demonstrating to the leaseholder what he must pay for the freehold?

§ Shona McIsaac
I thank the hon. Gentleman. We discussed that issue in Committee, and he may recall that my hon. Friend the Minister said that in the near future—I think that she referred to a period of six months—she 935 would consider consultation on information that would have to be provided to the enfranchising leaseholder. I hope that the hon. Gentleman recalls that.

§ Mr. Taylor
I recall it but I am not holding my breath.

§ Shona McIsaac
I thank the hon. Gentleman for that.
In reference to family members, the Bill uses the dry wording of "personal representatives". However, we are talking about family homes and the emotions that families go through when somebody passes away. A period of one year in which grieving families could choose to enfranchise—I accept that one year was a significant move forward anyway, as that right did not exist previously—was far too short. Families must deal with their grief, and there would have to be discussion among family members on whether they wished to purchase the freehold of the deceased parent's property and then they would have to raise the money to do so. That one-year period was out of kilter with the other arrangements, and I welcome the introduction of consistency.
The change will make a phenomenal and significant difference to many residents in my constituency, particularly elderly people, who, because of the publicity that has been given to these debates and to the Bill, have realised that without such a change their homes might have been lost. I know that many of them will he reassured by the measure, and I thank my hon. Friend the Minister for tabling this Government amendment.
I realise that in Committee I suggested a period of five years, but that was an old trade union negotiating technique. I started at five years hoping that I would get two.

§ Mr. Don Foster (Bath)
Lest it be thought that there is not all-party unanimity in our admiration for the work of the hon. Member for Cleethorpes (Shona McIsaac) on this issue, I too pay tribute to her long-standing efforts to sort out the matter. During the passage of the Homelessness Act 2000, when I was successful in persuading the Government to change their mind on some key issues, the Committee awarded me the privilege of sending a postcard home. I suspect that she merits a similar award.
Although the hon. Lady did not refer to the point in detail, it is important that there is a degree of symmetry in a Bill. One of the amendment's merits—over and above the human ones that she mentioned—is that it provides the symmetry that was lacking in the Bill's earlier versions. She was right to push the issue for a number of reasons, so on behalf of the Liberal Democrats I express my delight at her success in persuading, with the support of colleagues on both sides of the House, the Government to table such a sensible amendment.

§ Mr. Bill Wiggin (Leominster)
My hon. Friend the Member for Stone (Mr. Cash) referred to me earlier, so I shall explain why I spoke on this sensitive subject in Committee. As will be made repeatedly clear in our debates, there were two reasons for the original design of leaseholds. First, they were designed so that a leasehold house might be sold in a similar fashion to a freehold. The second reason was to enable the house to return to the freeholder after a short period—but more than 21 years.
It has been a tremendous achievement of the Committee and of the hon. Member for Cleethorpes (Shona McIsaac) to have incorporated this two-year 936 period in the Bill. It takes at least two years to proceed through the legal minefield, so the amendment is sensible and compassionate. It will become clear later that some leases were put together with the idea that they should return to the freeholder. However, a two-year period is very reasonable under the circumstances. I congratulate the hon. Lady.
The hon. Lady also said that there might be consultation in about six months, but that period may quickly disappear. I hope that the Minister will review the formula that my hon. Friend the Member for Solihull (Mr. Taylor) mentioned, although I noticed a little frown sneak across her face when he raised the issue. I look forward to reassurance from the Minister so that we can count down to the time when the formula will be reviewed.

§ Ms Keeble
Members on both sides of the House have recognised the work of my hon. Friend the Member for Cleethorpes (Shona McIsaac) in securing this amendment. The whole House recognises her long track record on campaigning on the leasehold issues affecting her constituents. We shall later debate other provisions that she has played a large part in securing. She has performed a real service to her constituents. We all know—she has often told us—that many of them are elderly people who live in leasehold houses. The points that she made about personal representatives and the interests of family members are very profound and real.
I want to clarify a point about the provision of information on the valuation basis. I have a feeling that the hon. Member for Solihull (Mr. Taylor) was talking about the formulaic assessment of the valuation that he has often mentioned, so I should clarify the remarks that I made in Committee. Under the Leasehold Reform Act 1967, we already have powers to prescribe the form and content of the landlord counter-notice, and we will consult on proposals to require information about the basis on which the landlord's counter-offer has been calculated. That will form part of our consultation on the secondary legislation that will implement the Bill. We have to consult on several issues in order to take the Bill forward. However, I note that the hon. Member for Solihull has not held his breath; he is no longer in his place.