Written Statement - Social Landlords Recharging Leaseholders for Major Works

I wish to inform Members about steps I am taking to improve the transparency of service charges to leaseholders for major works from their social landlord.

Often leaseholders are not fully aware of their responsibilities to contribute to costs for major works to their block of flats until they are faced with repair bills.  Individual leases can vary and whilst there are a relatively small number of leaseholders in Wales who are likely to receive repair bills, I do not underestimate the concern for those involved.

I believe early engagement with leaseholders by landlords, even before the formal consultation process begins, will greatly assist leaseholders to understand planned works and what they should legitimately be paying for. I want to ensure leaseholders are properly engaged and consulted by their landlord and there is transparency of process.

To achieve this, I am pleased to announce I have asked LEASE  to develop good practice guidance for landlords and leaseholders so there is clarity about each party’s rights, responsibilities and liabilities. Case studies will highlight exemplar examples of landlord engagement with leaseholders to help ensure bills are legitimate, transparent and fair.  

I have also asked LEASE to develop an independent review/mediation process in Wales to potentially reduce the need to use the Leasehold Valuation Tribunal (LVT). Currently  the LVT is the only step available for dispute resolution. The new service will offer impartial advice and seek to resolve the dispute without the need to resort to the LVT. However, it will not prevent a later application to the LVT should either party wish to do so. The details are still being developed,  however,  I anticipate the service will be self financed between the landlord and leaseholder as needed. Landlords and leaseholders will both be involved and have a say in the creation of the guidance and the review service.  
 
This work is already well underway and is making good progress. I expect the guidance and independent review service to be available from this Autumn.