Dear Ministry of Housing, Communities and Local Government,
Reserve Funds or Sinking Funds are held by Managing Agents/Housing Management Companies or "Freeholders" on behalf of Long-Leasehold Home Owners, mainly to pay for Cyclical Maintenance or Major Works. They are often paid for by the home buyer within Service Charges or collected separately. According to the relevant 1987 Act of Parliament, Section 42, these Reserve Funds, that can accumulate into very large amounts, should be held in a designated (separate) Account at a Financial Institution. Please could you answer the following questions concerning Reserve/Sinking Funds:-
1. How are these Reserve Funds (paid by Long-Leasehold Owners) accounted for in the Annual Company accounts of those who hold them?
2. How are these actions scrutinised?
3. Are Managing Agents/other holders of these Reserve Funds entitled to include these amounts as part of their Company Holdings or borrow against them?
4. What action is taken and what procedures are in place to prevent Managing Agents/Holders of Reserve Funds from including these amounts in their Company Holdings, obtaining the Interest Payments from them or otherwise misusing these funds?

Yours faithfully,

Rob Heale

Dear Ministry of Housing, Communities and Local Government,
Please note that the reply to my questions about Reserve Funds held by Managing Agents is long overdue. I would be grateful for a reply as soon as possible.

Yours faithfully,

Rob Heale