RTM: implementing a lower threshold
It could be done in a one-clause bill:
- omit subsections (3) (4) and (5) of section 79 of the Commonhold and Leasehold Reform Act 2002, and the cross-reference to those subsections made in section 85
This would remove the minimum participation threshold, which stands at 2 or 50%, whichever is higher. Without the threshold, the minimum participation defaults to the provisions of the Companies Act, which has for decades requires a minimum of just one company member/shareholder.
The problem with this is that it requires a criminal prosecution to rein in rogue directors of companies, and this means a director, e.g., a rogue leaseholder or a rogue managing agent, could set up an RTM company and then not let other leaseholders join, in contravention of section 74(1) which says which leaseholders are entitled to be RTM company members.
There is an enforcement power in section 107 of the CLRA 2002. It could be used to provide a statutory civil penalty for excluding leaseholders from RTM company membership. If it's insufficient, then it can be achieved with one more clause. The cost of private prosectuion is about £8000, which is largely not recoverable, so the civil penalty should be high enough to be a genuine deterrent, e.g., £5000.
Alternatives
One could also weaken the consent requirements for RTM company membership, by implying agreement into leases.
Note that in the identically-named but totally separate "Right To Manage" scheme for council tenants, the threshold is 20%.