Angela Rayner has urged the government to go further in regulating managing agents as part of its planned overhaul of the leasehold system in England and Wales.
Speaking to MPs on the Commons Housing Committee, the former housing secretary said the government’s draft legislation broadly strikes “the right balance” between challenging vested interests and delivering reform quickly.
However, she also called on ministers to move ahead with proposals for an independent regulator and stronger measures to improve transparency around service charges.
The draft leasehold bill, which is currently being scrutinised by the committee before progressing through Parliament, includes plans to cap ground rents at £250 a year, ban the sale of new leasehold flats and give homeowners greater control over how their buildings are managed.
But the proposed legislation does not contain specific measures to regulate managing agents or directly address rising service charges. The government has said it remains committed to introducing regulation for managing agents, including the possibility of mandatory professional qualifications, and has also consulted on reforms to tackle opaque or excessive charges linked to building insurance commissions.
Rayner, who served as housing secretary until September last year, told the committee the lack of regulation of managing agents was “a real problem” and said the government needed “to go further and harder” on proposals by Lord Best in 2019 to introduce an independent regulator.
Speaking alongside Rayner at the committee, former Conservative Housing Secretary Lord Gove, who oversaw the 2024 leasehold act, said there were “many good things to welcome” in the government’s draft bill.
Be he pointed out that the current housing secretary, Steve Reed, had been “fighting against a rear guard action mounted by the freeholders and other financial interests and supported by the Treasury”.
“I witnessed that myself when I was in government, and I think that the institutional resistance of the Treasury remains,” he added.
Under the government’s draft legislation, ground rents would ultimately be reduced to a peppercorn rate, effectively zero, after 40 years.
However, Lord Gove said he would have preferred “an accelerated timetable” of 20 years, describing ground rents as “essentially extortion”.
Jo Ironside, partner at law firm Mayo Wynne Baxter, commented: “Leaseholders have known for years the system is structurally imbalanced and without firm regulation of managing agents and service charges, the government’s reforms will not go far enough.
“Leaseholders face opaque fees, poor communication and inconsistent standards, yet they have almost no power to challenge the decisions that affect their homes and finances.
“While managing agents perform a complex and often undervalued role, the current lack of regulation leaves too much room for poor practice and little accountability.
“Leaseholders may not appreciate the pressures managing agents face but that doesn’t change the reality that consumers deserve transparency, fair charges and a management industry that is properly trained and properly overseen.
“An independent regulator, mandatory qualifications and clear rules on service charges and insurance transparency are long overdue.
“Raising standards may increase costs, but the answer cannot be to maintain a system where leaseholders continue to pay high bills for services they don’t understand and cannot scrutinise.
“If the government is serious about rebalancing power in the leasehold market, it must deliver meaningful consumer protections as part of this bill, not leave them for another decade.
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