Steve Whybrow, spokesperson at the Pensioners for Ground Rent Association, said: “Firstly, it’s important to make clear that we welcome any balanced legislation that aims to protect the consumer, and there are many aspects of this Bill that will provide greater protection to leaseholders.”

He went onto express that the association’s members are hugely concerned that the bill opens a ‘back door’ for the government to expropriate their pensions as a giveaway to curry favour with voters in an election year. 

“Beyond the existential threat to freeholders by the removal of rent (as well as marriage value in lease extensions), there are a large number of serious shortcomings to the bill.

“If passed, these would lead to hugely damaging consequences for freeholders, investors and – crucially – leaseholders themselves and the wider British public,” Steve added. 

The association said that the legislation is muddled and rushed, with Steve stating: “the bill has been launched concurrently with the consultation (which has only recently closed) on capping contractually committed ground rents.

“This overlap undermines due process for legislators to properly examine the bill.”

Regarding the loss that investors in the freehold sector will endure, Steve said: “Beyond our members, we are aware that large pension funds in this country have invested on behalf of huge numbers of people in pension assets that rely on income from ground rents.

“This is one of the most concerning elements of this potential aspect of the Bill, as passing it into law would lead to an immediate loss of over £32.7bn for businesses and individuals who have invested in good faith for decades in the freehold sector.

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“This would inevitably create a sudden wave of insolvencies, leaving our members in ruins as well as denting other pensioners in these large pension funds, depending on what percentage of their pension is invested.

“This isn’t a case of hugely wealthy landowners being given a bloody nose: it’s the very livelihoods of vast numbers of ordinary people — who have worked hard to build towards a comfortable retirement — being put to the sword.

“Without any compensation scheme proposed, this surely cannot be considered fair.”

Steve concluded: “We support every effort to ensure a balanced relationship between freeholders and leaseholders.

“Leaseholders have the right to enjoy their homes without being saddled with exorbitant ground rents or charges while those investing their pension assets in freeholds also have the right to see their retirement funds protected.

“This bill, however, would fail to achieve this balance.

“In its present form, freeholders would face financial ruin, leaseholders would lose vital building management provision, and the general public would end up covering the costs of the inevitable human rights and compensation battles with the government.

It is entirely illogical to squeeze freeholders to a point of insolvency when reasonable compensation would assist the eventual transition to a new-style ‘commonhold type’ of ownership in an orderly and coherent manner.

“Otherwise, flats with insolvent freeholders will likely become unsalable and unmortgageable.

“We urge the government to rethink its position on this bill, and to come to the table, listen to expert evidence from both sides and to negotiate a sensible middle ground that meets the needs of all stakeholders.”