Question
My Lords, some freeholders, although not all, treat their leaseholders as a cash cow. I have two examples for the Minister. First, there was a ground rent increase—and there is no value at all to the leaseholder in a ground rent—of 113% this year, which was backdated three years, and the sum was demanded to be paid in full in four weeks. Secondly, there was a 23% increase in service charges this year. There is no accountability. Transparency there is, and challenge there can be, but nothing comes of it—and it seems that nothing in the Bill will change that. Can the Minister tell me that it will?
Answer
I can. The Government have consulted on a range of options to reform existing ground rents, having legislated in 2022 to set all new ground rents at a peppercorn rate. Following the outcome of that consultation, we aim to legislate in the current Bill before Parliament. As I say, not only will we give leaseholders greater rights to transparency on what service charges are charged for, to ensure that they are reasonable, but we are changing the cost regime in the courts so they can challenge those charges where they think they are unreasonable.