Thank you, Sir David, and merry Christmas. It is a pleasure to follow the hon. Member for Witney (Robert Courts); it was interesting to hear his experience as a law student. A ground rent of £2 was probably a bit of a bargain compared with the problems faced by many of our constituents.
The House of Commons Library notes on the subject point out that there was a spike in leasehold sales in the north-west of England; 69% of all new properties in the north-west were subject to leasehold arrangements in which the developer retained the freehold. Several hundred of those properties are in Knowsley. For those who do not know my stance, I am one of those people who is not quite sure what the north-west is, but whatever it is, we in Knowsley are getting the phenomenon on a large scale.
I pay tribute to the hon. Member for Worthing West (Sir Peter Bottomley) and my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick), who have been raising this issue for a long time, whereas many of us have come to it more recently through the experiences of our constituents. I will highlight a couple of points, and then say a few words about the measures announced by the Secretary of State last night.
First, others have made the point about the use of conveyancing solicitors recommended by the developer who also work for the developer. The best that can be said is that that creates the impression of a conflict of interest. From what constituents have said to me, there was a conflict of interest in some cases. The hon. Member for Hazel Grove (Mr Wragg) was right to mention a need for more transparency. There is also something inherently wrong about the same legal practice dealing with both the developer’s interest and the purchaser’s interest.
Buyers were not informed that they could purchase the freehold. I have ample evidence from many constituents, which I will quote, that that did not arise in conversations with sales staff. Even if they were vaguely made aware, they were certainly discouraged from exercising the option to purchase the freehold. To achieve that, they
needed a great deal of persistence, because it was part of the business model that the developer retained that interest, either to have continued income or to sell the freehold to another managing agent.