2. What assessment has the Welsh Government made of the House of Commons' Housing, Communities and Local Government Committee’s report on leasehold reform? OAQ54065

I have read their report with interest. However, it is a devolved matter and our own independent task and finish group for leasehold reform is on schedule to deliver its report to me in July. I will be reviewing its recommendations and then deciding which actions to take forward for Wales.

I do commend you for reading the report. England and Wales law is often common in this area, and I think there are lessons to be learnt, and I think the House of Commons committee's done a great service here.

Estate management fees as well as service charges have been criticised for their size, lack of transparency and the difficulty with which they can be challenged. Those are certainly problems that we have in Wales. And Which?, the consumer organisation, has pointed out that no new-build housing estate should have their roads as the responsibility of the leaseholder, yet this is happening more and more at the moment. Often, as the report indicates, developers blame the local council, the council blames the developers and it's an unholy mess.

I have met with residents on a new-build estate within my own region and they've informed me that they're in a conflict between the estate and the local council and the developer over the adoption of a main road through the estate, which is a bus route. And despite that road being a key bus route, it's not at the moment going to be adopted. This is just a crazy situation. The planners should never allow it and the developers should not be allowed to produce roads of inadequate quality when they're clearly marked as being required to be bus routes.

I entirely agree with the Member's analysis of that. We do have a significant problem in some of the 106 agreements that have been negotiated between developers and councils throughout Wales. And one of the difficulties that has arisen as a result of that is the issue around the adoption of roads, the standard they have to be brought up to, the beneficial use of the estate in question prior to the adoption of the road and so on. So, we're attacking that on a number of fronts.

The most straightforward of that is that, alongside the leasehold reform group, we also have a task and finish group who are tasked with a review of unadopted roads. It's actually a joint task force between myself and the Minister for Economy and Transport, and they're due to give us their recommendations very shortly. We've specifically asked them to look at the introduction of a code of practice for estate and property management agents to enhance the professional and ethical standards that they operate to.

Simultaneously, Members will be aware that, yesterday, I did an oral statement on some of the suggestions that we're having for more regional working with local authorities. One of the areas that that was addressing was in economic development and land use. One of the specific drivers for that is to get the very valuable and unfortunately increasingly rare skill of being able to negotiate those agreements properly, so that the people who have those skills are available to all of Wales, rather than to those lucky local authorities who have managed to retain them. It's quite clearly an issue that we need to bottom.

So, we're looking at coming at it from both ends, if you like, but I think we're also looking at renewed guidance to local authorities, in terms of what they should be looking for when they're looking at a situation where a new development has largely been completed, but the roads are not at adoptable standards.

So, just to recap, we've got the leasehold reform group coming back, we've got the task and finish group coming back on unadopted roads, the UK Government's announcements are very interesting in terms of legislating to ensure that freeholders who pay charges for the maintenance of communal areas have access to the same rights as leaseholders in terms of the way that that's regulated. And we're very interested in looking at that as well.

Can I echo the comments from David Melding, because, clearly, leaseholders are facing some very serious challenges, particularly financially? And, when you come back to your working group, I hope that they recommend that you take action on putting regulation upon estate management companies—and if they don't, I hope you put it in anyway. Because, for example, I've got many constituents in my constituency who own properties on different estates—not just one, many estates—which are leasehold. And I've got one here in front of me that has actually given them the breakdown of the leasehold bill they've received for this year. They are required to pay £187 a month on top of everything—that's on top of council tax, on top of the utilities. And I'll include what they say: included in the list are out-of-hours fees; a management fee, twice; an accountancy fee; and banking charges. They're included in the list they're expected to pay.

Now, these are management companies that are looking after estates on behalf of these, and they are using it as a money machine. I hope you put in place, in those proposals afterwards, regulations to put upon these agencies to ensure that they deal with people fairly and that any funding they require is based upon actual need and not costs that they incur anyway.

Yes, again, I share the Member's disquiet at some of the practices that have arisen as a result of this. The fundamental issue is that when somebody buys a freehold house that they ought to be receiving the proper advice from their lawyers acting on their behalf about the other charges that are associated with that house, including whether there is an adopted road for which they will be required to provide maintenance. In response to David Melding, I rehearsed the things that we're doing to look at this. Certainly, in the short term, we're looking to see if there’s anything we can do about some of the specific charges.

The difficulty, though, is that there are protections in place for leaseholders, but those protections do not extend to freeholders who've entered into that kind of management agreement. So, the UK Government has seen that this a lacunae, so, with any luck, they'll step into that place, because we're on the boundary of the devolution settlement here as well.

So, we have asked the task and finish group to look specifically at some of the charges as well, but, actually, a much better solution would be to get the roads to an adoptable standard and get them adopted. So, it may be that we have to look at schemes in order to be able to facilitate that. And I will certainly be looking at our own Help to Buy scheme, to see if there's anything we can do in that scheme to make sure that we aren't promulgating practices that are unhelpful, to say the least.