Sir Keir Starmer faces a showdown with over 100 of his backbenchers if he U-turns on a promise to cap ground rent for leaseholders, a senior Labour MP has warned.
Barry Gardiner told Sky News that it will be a “betrayal” of Labour’s manifesto “and of natural justice” if the government rows back on one of its flagship housing promises.
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It comes amid cabinet divisions over leasehold reform, which has sparked a major intervention from former deputy prime minister and housing secretary Angela Rayner.
Labour’s manifesto promised to cap ground rents – a charge leaseholders have to pay so they can have a home on land they do not own. It does not require a service in return and is regarded by critics as emblematic of the feudal nature of England’s centuries-old leasehold system, which Labour has ultimately pledged to abolish.
However, the draft Leasehold and Commonhold Reform Bill intended to include these measures was delayed last year. Chancellor Rachel Reeves is said to be concerned that capping ground rents would deter pension fund investors – putting her at odds with Housing Secretary Steve Reed.
Mr Gardiner, who has campaigned against leasehold for years, told Sky News: “It is absolute nonsense to say that pension funds investors are dependent on ground rent, which forms only a tiny percentage of the capital tied up in a property.”
He said there are 5.5 million leaseholders in the country and “many of them were not regular Labour voters, but voted Labour last time because we promised to end this feudal system and to cap ground rent at a peppercorn…
