Having your say…

There was a fantastic response from readers commenting on the exchange of letters
between Flat Living and Grant Shapps’ office.
Below are some of the highlights. Keep your comments coming….

“I think that although ARMA and others will continue to press
for progress on regulation we must do the best we can with
what we’ve got. To that end, would it be possible for you
to direct us to where we can find copies of the two codes
of management practice that the official’s letter refers to? I
would like to print and read them and have them in my brief
case at our Directors’ meetings!”

“I am delighted the government is not going ahead with
keeping of separate accounts as you are trying to suggest.
I think that you should set limits above when this would be
required and not just apply the regulations to all blocks
of flats.
I am an accountant who owns a flat in a small block
of 12 flats with an annual service income of less than
£35,000 and we the residents carry out all the work which
an outside Management Company would perform. We
have our accounts audited and we present them to the
members who are very satisfied with the way we keep our
accounts, handle our maintenance, place our contracts
and handle all our financial affairs.
We do not want Big Brother-style red tape being imposed
on our small Resident Management Company and nor do the
residents. You should be more flexible with your demands
for small resident companies who spend far too much time
with health and safety issues and all the other unnecessary
company legislation that applies to large landlord controlled
blocks of flats. Unless you have experience of these small
resident management companies, you will have no idea how
expensive it is trying to comply with so much unnecessary
red tape and how large a percentage of our service charge
income is taken up trying to make sure we are not in breach
of these regulations.
As a further comment, I think you should also listen to the
views of the small audit firms who carry out this work on
behalf of the small blocks of flats who like using a sledge
hammer to crack a nut.”

“As a director of a small block of flats in Surbiton, I thought
that these proposals were a burden on managements
such as ours. The new regulations added nothing. Having
to open a new account for maintenance contributions
was unnecessary, only leading to more bank charges.
The requirement to have the accounts audited was just
an extra cost for no good reason. The residents of this
block are given full details of income and expenditure.
The new regulations were burdensome and offered no
advantage to the residents. The same applies to many
blocks of flats throughout the country. I say Grant Shapps
has made the right decision, which cannot often be said
for a government minister.”

“I believe the government is letting down leaseholders by
not pursuing the part of the Commonhold and Leaseholder
Reform Act 2002 regarding service charge accounting
regulations. I thought this had already been implemented.
We are fortunate in that we use a good managing agent
that has separate designated annual service charge bank
accounts and we receive an independent accountant’s
report each year. Having formed an RTM Company in
2007 we are able to control this but I am aware that many
leaseholders are at the mercy of their landlords.
In my view it is essential that this part of the Act is
enacted. The extra cost of having an accountant’s report
each year is minimal compared to the possible cost of an
unscrupulous landlord.”

“As secretary of a management company responsible for selfmanaging
one block of 6 flats I did not welcome the additional
costs of accountancy fees’ that we faced under the latest
proposal. Therefore, I am rather pleased that it has been
dropped and I do not support your position on this matter.”

“I am appalled about the decision not to proceed with the
service charge arrears.
I have had over three years frustration at not being provided
with relevant information and accounts for the service
charge I have paid and have also been involved in taking a
management company to an LVT .
Management companies do not automatically adhere to
the terms of the lease and despite having the right to request
at not being provided with relevant information it does not
mean managing agents provide it. Leaseholders need more
legislation on their side and more action needs to be taken
to enforce that legislation.”