Charities and pensioners do not support freehold feudalism

Norma Cohen

Honorary Research Fellow at Queen Mary University

There is ZERO evidence that pension funds and charities hold any significant stake in Ground Rent income. In fact, the opposite is the case. According to their own trade body, the Pensions and Lifetime Savings’ Association, no more the 4% of pension assets are invested in any form of property, the vast majority of it in offices, retail and industrial. 

This is just an effort to make it appear that the deep-pocketed investors who have bought up Ground Rent income streams are somehow working for the public interest.

Norma is properly responding to the continued lobbying of Residential Freehold Association and its ringleader, the Conservative peer Lord Moylan

Lord Moylan has been described as one of London’s most colourful politicians. The only colour I can associate him with is black.

I wrote a recent blog “not in my name” about how pension schemes should not be associated with freeloading freeholders charging huge ground rents for nothing. Charities should say the same.

I have not yet met one trustee who claims to hold these in their funds. I would be surprised if Charities are any different.

So long as the likes of Lord Moylan and his propertied buddies insist that pensioners are the beneficiaries of extortionate ground rents, I will insist

a) there is no evidence of us being the beneficiaries of such profiteering

b) there is hard evidence that I for one am a potential victim of a property scam that would have me paying the price of a hyper-inflated leasehold valuation as a ground rent.

The Government originally intended to scrap ground rents (by reducing them to a peppercorn rate which wouldn’t have been worth collecting).

Then they conceded to the likes of the not so noble Lord that our ground rents be capped at £240pa (£240 too much in my book).

But now, the freeholder association will have no cap and a continuation of the free for all which has put the consumer last and the entitled freeholder in total control of feudal dues.

I hear from Harry Scoffin of the “Free leaseholders” campaign that the £240 cap is under some pressure (see report below from “the Negotiator”). I will be engaging with him more about where the pressure is coming from and why no one , but the dedicated few are challenging the statements of Moylan,

Michael Gove  is facing yet another rebellion within his own ranks after 30 MPs last night wrote to the Chancellor to highlight their anger over the watering down of the Leasehold Reform Bill.

The Government had originally said it would scrap ground rents or make them peppercorn which, at the time, housing secretary Gove said was a ‘charge for nothing’

But a row has now broken out over whether this was a part of the party’s 2019 manifesto or not.

That manifesto said:

“We will continue with our reforms to leasehold including implementing our ban on the sale of new leasehold homes, restricting ground rents to a peppercorn, and providing necessary mechanisms of redress for tenants”.

The rebel MPs are insisting Sunak and Gove stick to this manifestopromise, but the British Property Federation says this is a ‘grave misunderstanding’, arguing that is covered ‘new’ leaseholds and was not a retrospective promise.

MISUNDERSTANDING

Ian Fletcher, its Director of Policy (Real Estate, says: ““There seems to be a grave misunderstanding that the 2019 Conservative Manifesto somehow confirmed a mandate for the party to retrospectively abolish ground rents on leasehold properties.

“This is a view which has been carried over by a group of parliamentarians who are seeking to go beyond the intent and spirit of what that manifesto contained.

“The then Minister, Lord Greenhalgh, clearly stated in a House of Lords debate in 2021 that the Conservative Government’s formal position was not to abolish existing ground rents, due to the material negative impact that would have on pension savers, but only stop new ground rents being created.

“At best, the manifesto commitment is ambiguous, and in light of previous statements certainly does not provide the clear mandate proponents of abolition claim.”

This is not about 2019 manifesto promises, it is about what is fair to the British public. Charities and Pension funds do not exist to rip people off.

Greenhalgh and Moylan speak for the feudal few- they do not speak in my name.