Matthew Pennycook

I thank the Liberal Democrat spokesman for those questions. He often mentions Lloyd George, and I share his passion for Lloyd George’s radicalism on property law and other measures. I will address the specific points that he raised. During the passage of the Leasehold and Freehold Reform Act 2024, I was clear that my instinctive preference when it comes to ground rents was for a peppercorn cap, fully eliminating ground rents. The changes that we are making ensure that, after 40 years, that change occurs. Having considered all the analysis and advice available to me as a Minister, including the evidence gathered in response to the previous Administration’s 2023 consultation, I believe that we have set out the right policy. It is clear that an immediate peppercorn cap would carry significant risks, including some that might impact on leaseholders. The Government also recognise that there is a significant difference between regulating the creation of new leases, and intervening to affect existing contracts and investments. On the functioning of the cap itself, I want to make clear that it is a maximum cash cap. If someone’s lease is below £250 and does not include escalating clauses, their ground rent will not rise to £250. If someone’s ground rent is over £250, at the point that the measures are brought into force they will see an immediate reduction. That will benefit millions of leaseholders across the country. It is a huge cost-of-living intervention, and I hope the House can get behind it as the most just and proportionate way of addressing unregulated and unaffordable ground rent terms. The hon. Member for Taunton and Wellington (Gideon Amos) will know that we ran a consultation last year on how we can standardise service charges and increase their transparency to ensure that leaseholders can better challenge the reasonableness of service charges at tribunal. However, we do not intend to bring forward a cap, not least because doing so could harm leaseholders, particularly those in enfranchised buildings, who may need to raise sums beyond the cap to carry out essential maintenance works on their buildings.