RMG forced to apologise to residents after huge rise in management costs sparks backlash

RMG backed down on demands after enquiries from The Lancashire Lead - but say the rise in fees was always an error

Hello and welcome to The Lancashire Lead.

A victory for local journalism today as residents were spared a 38.61 per cent leap in charges by a property management company after The Lancashire Lead took up the issue.

RMG initially defended the increase before backing down and claiming that the increase was an error - something residents are highly sceptical about.

The issues at the estate - which developers described as offering a ‘superb quality of life’ in marketing materials - do not end there. And that is the topic of today’s newsletter.

The Lancashire Lead can only keep reporting issues like this with the help of more paid subscribers. We report on important issues in depth and in a way that would not happen without us. In November, you can take a paid subscription and get 30% off - so there’s never been a better time to back us.

Lancashire briefing

🏠 A former Preston pub is to become a home for vulnerable adults. The green light has been given to plans to turn what used to be Oblivion, on Grimshaw Street in the city centre, into supported accommodation. The hostelry closed down more than five years ago and – along with an adjoining property – has already undergone refurbishment for conversion into 11 one-bedroomed apartments. Now, Preston City Council has granted further permission for the refitted buildings to be used as specialist housing. No additional physical alterations will be required.

📍 Just two new councils should be created to serve the whole of Lancashire when the county’s 15 existing local authorities are abolished, Lancashire County Council is set to argue. The authority has published its preferred option for the outcome of a government-ordered shake-up that will usher in – by April 2028 – the most radical changes to the council landscape in Lancashire in more than 50 years. Under the county’s council’s vision, two new ‘unitary’ authorities – North Lancashire and South Lancashire – would be created, with the River Ribble broadly being the dividing line between the two.

North Lancashire would bind together the six areas currently covered by Preston, Blackpool, Fylde, Wyre, Lancaster and Ribble Valley councils – a total of more than 722,000 residents. Meanwhile South Lancashire would combine the eight council areas of South Ribble, Chorley, West Lancashire, Blackburn with Darwen, Burnley, Hyndburn, Rossendale and Pendle – assuming responsibility for a population of just under 888,000 people.

🌳 Plans to build more than a dozen homes across two sites in rural Chorley have been kicked out by councillors amid a wrangle over the difference between green belt and grey belt. A total of 17 properties were proposed for a pair of plots in Eccleston – nine on Shelley Drive and eight on Bradley Lane – less than a mile apart from each other. Chorley Council planning officers identified both parcels of land as grey belt – a new concept introduced by the government last year with the intention of boosting housebuilding. The committee ultimately refused each of the applications by a majority.

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RMG forced to apologise to residents after huge rise in management costs sparks backlash

The Hedgerows in Leyland. Credit: Redrow

By Kevin Gopal

A controversial property firm has claimed a huge rise in management costs to Leyland residents was an error after The Lancashire Lead contacted it over their concerns about fees.

But RMG, which manages the Hedgerows, had earlier told residents its proposed 38.61 per cent leap in fees for providing company secretarial services was necessary because of a previous undercharge.

RMG manages more than 115,000 households across the UK, including the Hedgerows, a development built by Redrow on Wigan Road in Leyland.

Extensive reporting by The Lead has revealed a litany of complaints about RMG across the country, including excessive charges, poor repair work and a lack of transparency about its fees.

RMG managing director Justin Herbert apologised to MPs earlier this year for the company’s failings after they wrote to him about their constituents’ complaints.

One of the MPs at the meeting with Herbert, Maya Ellis who represents the Ribble Valley, said she had heard “too many stories on the doorstep of how poor communication, unclear service charges, and low standards of service have significantly drained residents’ day to day wellbeing”.

Ellis vowed to continue to support residents so they can “live in a house they can be proud of and feel comfortable in”.

At the Hedgerows, residents were alarmed when RMG told them it was passing on a 38.6 per cent rise in fees for company secretarial services provided by its own subsidiary, Hertford Company Secretaries, to the development’s management company.

Hertford’s services include maintaining statutory records, filing annual returns, managing the registered office, and ensuring compliance with Companies House requirements.

Residents felt that not only was the rise in fees unjustified but that RMG’s use of its own subsidiary was a potential conflict of interest. RMG holds, directly or indirectly, more than 75 per cent of Hertford’s shares, and has received dividends from it.

When questioned over the rise by one resident, RMG responded that the main increase was the result of correcting a previous miscalculation. But when The Lancashire Lead later contacted RMG, a spokesperson replied that it was a “recently identified” error and the correct increase should have been 3.86 per cent, not 38.61 per cent.

“We’ve taken immediate steps to rectify this and are issuing refunds to the residents affected. We sincerely apologise for the error and will be contacting those impacted directly to confirm the refund and next steps,” added the spokesperson.

“RMG’s initial defence of the 38.61 per cent increase, followed by a later admission of error to you, raises questions about transparency,” one Hedgerows resident told The Lancashire Lead, asking not to be named.

“It appears this correction only followed media involvement. How many other developments have been affected by this same miscalculation, and is a full review underway?