Labour demand urgent action to tackle spiralling leaseholder charges

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Councillors call on Mayor to use executive powers to scrap 17% increase in admin costs

Last night councillors voted to endorse Labour’s call for an urgent action to tackle the rising charges faced by leaseholders in the borough. Labour criticised the current system operated by tax payer funded Tower Hamlets Homes as “opaque and representing very poor value for money” as it meant that leaseholders were regularly being charged for services they hadn’t received. Questions were also raised about the 17% “overhead” costs which are added to many charges faced by leaseholders. The councillors called on Lutfur Rahman to use his executive powers to reverse the 17% increase, yet received no response from the Mayor.

The councillors demanded an explanation from the Mayor as to why only five of the fifty four recommendations of a landmark review into leaseholder charges had been implemented even though the review was completed in May 2011.

In spring last year, the St Stephen's Estate Leaseholders Association published a damning scrutiny report, which exposed the failure to implement the recommendations in the Beevers & Struthers audit yet Lutfur Rahman has failed to act to protect residents from rising costs.

Labour say that leaseholders across the borough have had enough with the inaccurate charges and argue that things would be better if Lutfur Rahman had focused on standing up for residents as opposed to using his supporters to bully the last Chair of Tower Hamlets Home into resignation.

Throughout the debate on the issue councillors and members of the public raised numerous examples of residents who had been hit with inaccurate and inflated charges. One case study raised by Cllr Carlo Gibbs told of leaseholders in Barnes House who were hit with massively inflated charges last year after THH decided to backdate energy charges for the previous three years. This despite the fact that some of the leaseholders had only lived in the building a matter of months.

Labour councillor for Bow East, Marc Francis, who proposed the motion at council said:

“Year after year residents are being forced to pay charges which bear little relation to the services they receive. We set up the audit into leaseholder charges to get to the bottom of what needed to be done to increase transparency and accountability and drive through improved value for money.” 

“Almost three years have passed and still the audit’s key recommendations have not been properly implemented.  Instead, management and administration costs have spiralled out of control as Tower Hamlets Homes has failed to deliver genuine efficiency savings and the council has loaded it down further with unnecessary costs.”

Labour’s Candidate for Mayor of Tower Hamlets, John Biggs, said:

“Leaseholders who are facing rising living costs will be demanding to know why Lutfur Rahman has ignored this problem for so long. Instead of dodging the tough decisions he should be working to deliver better value for money for our residents. If I become Mayor I will demand greater transparency and evidence that costs are under control and represent good value.”

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