As the rain streamed down, Rishi Sunak stood outside Downing Street and announced that Parliament will be dissolved on 30 May 2024 ahead of the General Election on 4 July.  However, no parliamentary business can be carried out after 24 May when Parliament is prorogued (suspended). 

The period that is now left for Parliament to push through any outstanding draft legislation is known as a ‘wash-up’.  This wash- up is extremely short at just two days; the wash-up during the 2017 election lasted 13 days during which 13 government bills received royal assent.  Fast-tracking legislation, which can enable legislation to be passed in less than a day, requires the co-operation of opposition MPs and peers, sometimes necessitating the removal of contentious parts of a Bill to get it through.  This is unlikely to happen with either the Renters’ (Reform) Bill or the Leasehold and Freehold Reform Bill. 

Renters’ (Reform) Bill

This Bill awaits committee stage in the House of Lords.  It still has to go through committee, report and third reading stages in the Lords, before being remitted to the House of Commons.   The Bill is contentious – at its third reading in the Commons there were more than two hundred amendments tabled – so it is very unlikely that the opposition would co-operate to enable the Bill to be passed. 

Critics of the current administration will point to how its 2019 election commitment to abolish ‘no fault’ evictions, those carried out under s21 of the Housing Act 1988, has already been abandoned.  Michael Gove, the Bill’s sponsor, has been evangelical in his efforts to improve the situation of residential tenants, but had been forced to suspend this in the face of opposition from his own back benchers.  The reform is now dependent on a future assessment on the operation of the county courts’ eviction process and improvements to the backlog, so that the system operates smoothly.

The hours and hours of debate over this Bill will therefore be wasted.  The Labour Party is likely to make the abolition of s21 a plank of its manifesto. Any new housing minister, like his predecessor, is likely to find that reforming any residential property legislation is easier promised than delivered.  Landlords therefore have a temporary reprieve. 

The Leasehold and Freehold Reform Bill

This Bill awaits report stage in the House of Lords.  It has to clear report and a third reading there, as well as dealing with any amendments from the House of Commons.   The most contentious reform in this Bill had been retrospectively to cap ground rents at a peppercorn, but Michael Gove, also the sponsor of this Bill, was forced to abandon this after intervention from the Treasury.  The Treasury had become concerned on how the effective abolition of ground rents would impact on large investors, such as pension funds.  As late as the end of April, an unrepentant Michael Gove was talking about a ‘journey’ to peppercorn rents, by effecting an even greater reduction in the currently proposed cap on ground rents of £250 per annum.  He has, however, run out of time. 

The Labour Party has its sights levelled at the abolition of long residential leasehold interests.  The initial commitment last year to abolish leasehold ‘within a hundred days of coming to power’ has been modified.  Again, like Mr Gove, his likely successor may discover the hard way how hard it is to change a thousand years of history. 

Conclusion

Never has the old cliché of ‘back to the drawing board’ felt so resonant.  The industry has had the opportunity to learn how difficult reform of something as complex and interwoven as property interests can be. 

We will be keeping you up to date on the property implications of the main parties’ manifestos during the run-up to election day. 

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ADDENDUM: The Leasehold and Freehold Reform Bill became the very last piece of legislation to be passed in the life of the Parliament, and received Royal Assent on Friday. The most controversial proposal – to cap ground rents – did not survive.

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